You know, I am having a hard time getting into the news that is coming out at the moment. This is a slow time of year obviously and media networks are not doing all they can, world leaders are laying low and the statistics that would normally fill the slow spots are just not there. But there are a few things we can look at and try and plot next year.
1) Retail Sales. Christmas generally represents a large chunk of the retail calendar. Anywhere from 40% to as much as 70% of most company's profits are made during the Christmas season and in many cases, it is the time when the bottom line is either met or broken. Christmas can break a lot of companies. The problem is that it is a double edged sword. People are increasingly taking on huge amounts of debt in order to achieve the Norman Rockwell style everything is perky and good Christmas season. This debt has to be paid. With the new bankruptcy laws in affect, along with increases in minimum payments by credit companies, the amount of debt being held in the nation is going to be painful to pay off. And don't forget, it is about 90 odd days until April 15th, which is tax day - in many cases, yet another debt.
2) Christmas. Well, I cannot say that Christmas is my favorite time of year. Between the stress and the silly games that I see played out, it makes little sense. This year, the holidays were marked by what you called it. The religious right were complaining that the word Christmas had been pulled from marketing in favor of the more neutral Holiday (just because retailers were hoping to capitalize on a late Chanukah and Kwanza is something that is overlooked by the religious community). Even the President of the United States sent out Holiday Cards, recognizing that his constituency is more than just Christian. But we have already had the mass of shootings that follow the season and at the end of the day, I have to ask - is it really all worth it? How much did you spend to buy gifts, travel to places you would not visit at any other time of the year and be with people that, quite frankly, you cannot stand. This is a happy time?
3) The Economy. Everybody is breathing a sigh of relief that the hurricanes did not damage, at least significantly, the fourth quarter numbers. I hate to say this, but edge of the wave is coming and it is going to be painful. Remember all that debt I mentioned. Now imagine that you have no real way to pay it back? Welcome to the plight of many in the gulf coast. And who do you think will bare that burden? If you thought $3 for gas was bad, wait until your mortgage company and your credit company start demanding higher payments to offset their losses in the gulf, not to mention your insurance company, and your grocery store. No, the effects of the hurricanes are not even close to being felt yet, but it should not take an economist to tell you they will be and they will hurt.
4) Homeland Security. The US government got caught with its hand in the cookie jar. Domestic spying has been going on a lot longer than what they have admitted to and will continue well past this flap. The biggest problem is that no one really cares.
5) 2008 Elections. We are only a few weeks away from the kick-off of the 2008 election season and it proves to be a major issue for both parties. Issues such as gay marriage, abortion, God, and a host of other divisive topics will be front and center. Instead, ask your representative about the power grid, or the road network or how people will get around when the airline industry implodes and Amtrak is unable to service the country's needs. We will be back to driving and the problems that the economy is already facing will get worse. The next six years cannot be any worse can they?
I do not see a lot of good news in 2006. There are too many real problems that need to be addressed but there is a disturbing lack of leadership to address them. Maybe things will improve in 2007.
8:31:48 AM 
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