Jump to content

Economy Concern


Recommended Posts

  • Replies 50
  • Created
  • Last Reply

There will always be some that can afford your services no matter how hard the economy will get, but there will a good share that won't be able to should things get ALOT worse. I feel that there is a good chance that these people will go back to tying their quilts until things get better again.

Also I'm glad that I'm not taking in any customer right now...I don't know that I could have made it though a depression if it had happened when I was totally depending on customers to not only make my studio rent, but put food on my table. In 2001-2002 when we hit that little bump, in the economy, but customers dropped about 25-30% (about 30 ladies out of 100 repeat customers) in that year and I never did regain them back as a steady thing...they would bring me one or two a year not like the 4-6 before that.... with me leaving the Reno area in 2004.

Link to comment
Share on other sites

My business has been slow for about 2 months. I must say that I am doing some things I'd like to do but don't think I will invest in a computer because I don't know how long it will take to pay for itself. I'm wondering how high the price of fabric will go and if people will be willing to spend the $ it takes for the "latest" fabric. Perhaps they will dip into thier stash or maybe just scale back on the number of quilts they do.

Link to comment
Share on other sites

I noticed our fabric in the quilt stores is pushing $10/yrd. My best customer said when it gets that high she will quit. Now, that woman has 3 machine quilters and says she has enough quilt tops done to keep me busy for the rest of my life....I hope so :)

I was thinking about the economy as I shopped at Wal-Mart yesterday. While I was checking out I looked up at the nail salon and every chair was full of people getting their pedicures. Now, I am pretty low maintanence, so I thought that would be one of the first things to go....not so! Maybe it is priorities. If making quilts is their "thing" then they won't stop....or....they will learn to quilt it themselves on their DSM.

Link to comment
Share on other sites

I live in a high unemployment area, and not because there are not jobs, why should people work if they are handed a check each month for not---just a grip of mine.

Any way where I live, some people believe the $100/ month for T.V. cable is a right, so when you talk about priorities it is where every one puts theres. Some can't "afford" the food for their kids, but they have the cable. Go figure.

Oh, by the way, I do not quilt for others as a business. My machine is paid for and it sure helps not "having" to take in all those quilts to make a payment. I have to drive 100 miles round trip to buy fabric. The prices are up to $10 or more yard, but I usually shop the sale bin first, buy as much as I can afford and store it. If I have a specific project, then I shop for exactly what I need. I do make quilts for others, but at the price of gas, I do not run to the quilt store as much as before. I plan my trips better. I also only have limited basic cable, because I would rather have internet service than a bunch of t.v. stations. Can't afford both so make choices,

Link to comment
Share on other sites

Personally I think it is going to get a whole lot worse before it gets better. Now that the bailout failed and there is no credit available our economy can go no where but down. I don't like the idea of the bailout and it really burns my butt as my MIL would say but I think not doing anything is going to affect us all too! I really wish I were a great economist and could make really viable solutions to this mess we're in but I think we can only blame the "you owe me kind of people" who bought more than they needed and the stupid banks that were reckless with our money and gave them loans they shouldn't have! I'm obviously not happy at all about the mess we're in and even though we have always been fiscally responsible we'll pay the price just as bad as the people that took the loans! Just irks me...Ok off my soapbox too...just gets my blood boiling!

Link to comment
Share on other sites

Heidi, are we twins? I feel the same exact way about the banks haphazardly handing out these loans willy-nilly to folks without justification or accountability. I blame the banks. These bankers have the power to say A)"Sure here's your free $$ for an interest-only mortgage." "What? Don't have an arm or a leg to stand on? No problem...Here's an ARM for ya!" "What? You need a credit card but don't have a job? No problem! Here ya go." "Say, do you need an extra credit card just in case you max this first one out? Sure...Here ya go! Have fun!" At the same time, these banks have the power to say: B) "Sorry, you'll need to save for a few years and put 20% down or you can't buy that REALLY REALLY EXPENSIVE and over-priced house that's really not worth what they want to sell it for. So, let's, you and I, do the safe and wise thing and find something you really can afford to make payments on." :o

I blame the all-powerful, omnipotent banks. Those who really make the final decision on the home loans and issuing the credit cards to everyone's next door neighbor and best friend's uncle. I just wanna chop their greedy heads off and put them on the end of a stick posted along London Bridge like we did way back in the olden days :mad:

Link to comment
Share on other sites

I think its a worry, unemployment in RI just hit 8.5 just behind Michigan which has the highest in the US and the state has been reforming our welfare system so now the people who were given a 2 years to get a job well time is up! They all have to find jobs now! should be interesting to see if they can get jobs now.

I do see people cutting back. lets hope it won't last too much longer and they can find a viable answer for everyone

I gave up dunkin donuts/soda to keep my fabric purchases. I figured if I gave all that up I save about $150.00 a month thats a lot of fabric even at $10.00 a yard! but when gas went up all that savings went to the tank... go figure!

Link to comment
Share on other sites

Evidence from my fabric reps and others over here in the UK is that in times of recession people cut back on the big ticket items. They don't go on the expensive foreign cruise, they don't remodel the kitchen, they don't change the car every year but they will treat themselves to a bit more fabric because it is a much smaller expense as compensation for giving up the more expensive items.

But then maybe the reps are just trying to persuade me to buy more fabric! Though I do find more people coming in to buy stuff to do repairs rather than going out to buy new items. ie darning wool , patching fabrics, needles, threads for mending their camping gear. etc

Fabric is already expensive over here $15-$20 per metre (40"). This is partly a globalisation problem. The fabric is perhaps "grown" and spun in India, shipped to Japan or Korea to be printed, shipped to the USA and then sold on and shipped to the UK. Think how many middle men there are who need paying in the process.

I can moan but I don't know what the answer is.

Link to comment
Share on other sites

Shana - can I be the 3rd evil triplet? I agree with all y'all. The consumer lending industry has (WITHOUT OVERSIGHT) been lending money to people who could never afford to pay it back, but they were told they could "afford" the loans, credit cards, car loans, etc. Twenty five years ago people who couldn't qualify for a mortgage didn't get one and they rented an apartment, condo or house until they could qualify. Now with the mortgage lenders becoming less regulated, less rules, lower standards, people who would otherwise did not qualify did get mortgages they couldn't afford and ultimately went into foreclosure, filed for bankruptcy, etc. These are the people the consumer lending industry loves. Believe it or not, the credit card companies and the sub-prime mortgage holders actually still make an insanely high profit even if the majority of their customers to belly up. It's because, if they lose the house, go overboard on the credit cards, the companies can charge off the debt and sell it to a collection agency who can keep calling the customer until they pay it or until they die. Unless they can file for bankruptcy, but laws were passed a few years ago making it even harder to file for bankruptcy. Now, for this part of our population, death will be the only single way to discharge this debt.

This USED to be the middle class. Our economy needs a stable, strong middle class, we cannot survive without it. That's what happened in the Great Depression, we lost our middle class. Now the "geniuses" that got us into this mess, have to find a way to fix it.

Ok, I've said my peace. Thanks girls!

Link to comment
Share on other sites

We're falling victim to the banks not knowing what they are doing. I was told that we would have a 2 week turn around to get a home equity loan for 15,000 so I can buy my first longarm:) I was very excited, and hubby and I both have great credit. My hubby's profession has also enabled me to stay home with our new daughter:) However, we were told that it would take two weeks on August 22nd! Over 5 weeks ago! I've already put four thousand down on my machine! Thank goodness my rep has been patient. Hopefully we will be closing on the loan soon!

Link to comment
Share on other sites

I'm the next twin on board.............. I grates me when people won't take a job because it doesn't suit them. Heck - it's a job. I grates me that so many kids today have so much including the credit cards and have no idea that so many of us had to save before we could have anything new........ What a novel idea - save for what you want. It grates me when so many people need (not want), but need to keep up with the Joneses - guess what? - the Joneses are probably in debt too.

Even though I hate to see all the problems with our economy right now, I have said for years that it was going to happen. Credit has been so easy for people to get - the problem has been that the lenders forgot to factor in the ability to pay for the credit. My folks always taught me to pay for / not charge for what you want - credit is only as good as what you have in the bank. Yes, I have a credit card, but I also have the money in the bank. I wrote checks until it became a pain to write a check. So many places won't take them anymore. It seems that credit is better than money - go figure.

I could go on and on and this this site really is for quilting so I will bring my quilting in. I SAVED FOR 5 YEARS TO GET MY MILLIE - my parents taught me well. What I do charge, I know I can pay for!! I do hope that those of you who rely on income from their quilting do not suffer. Hopefully the cable TV does not win over quilting - you are all so talented and work so hard - I will pray for all of us through this difficult time!! Plus quilting is way better for the soul than TV.

Link to comment
Share on other sites

I posted this same question at the begining of summer. I noticed a big drop off of business then. I still get some business but it is 1/2 of what it was last year at this time and the size of the quilts that are comming in are small lap/wall quilts vs the large bed size quilts, and they are picking the cheapest of my patterns that I do. Also they have been telling me that they are using the fabric in their stash more instead of going to the LQS to purchase new fabrics, also they are now buying the cheaper battings instead of the good quality stuff.

So yes the ecconomy is effecting my business, and I think it will be this way until people feel more confident in the economy and their finances.

I have mixed feelings about the bailout, I am against it and I am glad it didn't pass. I think there is a better solution to this problem and I think the market needs to readjust itself after it was artificially raised for so long which is also why the value of our dollar went down. The mess we are in now is a resault of GREED plain and simple...greed on the part of the lenders to get that bonous for selling the most loans in X amount of time and greed on the part of people trying to buy homes and stuff that they didn't have the income to support. We have grown into the generation/society of "I want it now!" or "at what ever cost".

On the other hand I fear that there is a lot of people out their that have lost alot of their money that was in their retirement portfolios/ 401Ks/ and pension funds over the past year. I based this on watching my MIL's funds evaporate to the point that we are concern about how many years that she will be able to be financially independent...she has lost about 30-40% of her asests due to the wallstreet crisis over the past year. This will affect alot of people that are retired or getting close to retirement because there is not alot of time to recover from it. Like there is for someone in their 40's or 50's.

Priorities will have to be evaluated going forward and the ones that will survive will be the ones that choose to pay their morgages/ bills vs those that choose to get their nails done, or would rather buy their starbucks and drive their expensive cars vs paying off their financial obligations.

Link to comment
Share on other sites

Ok, I am going to step in here and be an evil twin of another sort. Putting my foot in my mouth, but as a licensed real estate broker, I am appalled that my industry is not taking a hit on this. When a buyer is pre-qualified to buy a $200,000 house and the real estate sales agent shows them a house for $300k that they fall in love with, the real estate agent writes up the offer and gets it accepted assuring the buyer they will make sure they get a loan. Then the realtor makes sure the mortgage broker and appraiser know if they don't make the deal go together they will never refer another deal. The realtor then makes sure the buyer gets their loan with threats and coersion, and guess who walks away with the commission check and never looks back? Do we ever hear about this? About the industry getting prices sky high in the first place? Do the realtors ever have to give back part of their checks, or answer to anyone for their part in this mess? Accountability should start at the beginning of the transaction. Buyers that gamble on future earnings to live beyond their means should not be bailed out of the mess they create, with the help of realtors, mortgage lenders and investors. When my honey and I were recently shopping for our house, we put an offer in on a house which did not appraise. The other broker insisted he could find an appraiser that would "make" it appraise. Now tell me, why would I want to buy a house that was "made" to appraise, and yet it happens all the time. Did you know the appraiser requires a copy of the purchase agreement so they can make sure it comes in at asking price? Fortunately for me, I have an inscrutable lender that does things the right way and saved me from making a big mistake. If I were not industry savvy, I might have fallen for the tactic. Instead, we continued shopping and found a house that appraised, by the same appraiser, for more than our offer. A much better deal all the way around.

This is my opinion only. But as an insider, I have a different perspective. Been in the industry for over 20 years and have seen many horror stories.

Nancy

Link to comment
Share on other sites

Nancy - I'm so glad you brought up that part of the industry. Yes, there are many fraudulent lenders, appraisers, mortgage brokers, etc. And more than likely, the honest ones suffer - cut off from referrals, etc. This whole mess is made up of the good and bad, evil and honest. There isn't enough federal prison space to house all the dishonest (and illegal) behavior that has occurred in the past 10 years in the consumer credit lending industry.

Link to comment
Share on other sites

Nancy,

Yes you are so right they are to blame as well. I have watched the housing market in our area go out of control and hubby and I both wondered how the heck our neighbors would afford to pay their mortgage. I just can't imagine being talked into going higher! Unfortunately three are appraisers that will appraise based on what "is needed" instead of the way they should. They should be held accountable too! I just don't know how we can get out of this mess without everybody paying the price for some!

Link to comment
Share on other sites

We are a McDonald's society, we want what we want when we want it and how we want it whether it is good for us or not. I see this all the time in health care.

The home buyers want homes it took their parents 30 years to get, immediate gratification. The banks want people to take out loans the bigger the better as they get more money.

There should be prosecutions of the executives whose greed promoted the excess. IF individuals are allowed to default to bankruptcy...even though they deserve it because of bad personal financial decisions...at some point we all take the hit with higher prices.

My son works at the Federal Reserve Bank (which is a private bank, not a federal organiation by the way) Vernake wrote a book about not bailing out and now is in support because the cost to our economy is so high.

I retire in 7 years, I only hope my hard earned investments and savings recover by then.

Fabric at 10$ per yard...thank goodness, I bought so much when it was cheaper! ;)

Link to comment
Share on other sites

another culprit to this mess our the people who were "flipping" houses. Some of these people quite their day jobs, got their realtors licesne and bought up alot of houses, made a few inexpensive cosmetic changes then sold them for a higher price to make a profit in a 3 month turn around time. These people were holding high risk morgages and trying to beat the clock or better known as musical chairs and then when the market crashed and when they couldn't make the payments on these morgages they ended up in forclosure. So not all of these foreclosed houses belong to families who got stuck with a bad loan... a good portion of them are from people who saw an opertunity to make a quick buck by taking advantage of the loopholes in the system for their own greed.

Link to comment
Share on other sites

In 1992, we had some real financial reversals to the point that we almost lost our house and were reduced to riding bicycles and taking the bus. Unlike in Denver, where I worked for a couple of years where even business executives took the bus because there just were not enough parking spaces downtown for all the people who worked there, in our part of the country in 1992, the only people who took the bus were those who didn’t speak English. But we sacrificed our pride and the comfort of a car, rode the bus, and caught up on our house payments.

A lot of people don’t know about the concept of “sacrifice.”

In 1999, the bank repossessed the house next door and we lost our nice neighbors—the ones who drove a shiny new big black BMW while we rode bicycles and took the bus for seven years—and when they drove away the last time, they drove away in their black BMW. They kept their car instead of their house. But she who laughs last, laughs best, because we still have our house (almost paid for now), and we have a car. And a longarm machine! !

This bit about the top guys of Wall Street receiving MILLIONS of dollars while the companies they run fail makes my blood boil. I’ll not get started on that topic.

But wasn’t it stupid of SO MANY people to let themselves be taken in by buying more than they can afford? A lot of people care only about immediately gratification. Had they never heard the saying, “Act your wage”?

I’m babbling. Time to quit.

Link to comment
Share on other sites

I really hate to say this, but remember back on September 11, 2001 when we were attacked? Even before that we were attacked several times. Remember Osama bin Laden was bragging in his videos about destroying America? Well, guess what... he's even bragging more now at this very moment. It's happening. The reason these Islamic extremists hate us so much is for the very reason why this world is crashing down now. They hate us because we live far too extravagant a lifestyle; our wants and needs are material things are instant, excessive, and far beyond what is truly necessary. It's all about the image; the big house we live in; the model car we drive; the bling bling jewelry, and clothes, the free-will sex with multiple partners, and the social stuff...all that everything over-the-top decadence that this modern society has become. Everything is so expensive. Why does an average family home in California have to cost between $500K and $1,000,000 or more? Who allowed all of this to happen and spin out of control? What is it about this "fake image" that people feel the need to live up to? So they can act and look cool driving an H2 Hummer while talking on their iPhone and wearing/shopping only for designer clothes, shoes, and jewelry and whatever while living in the fancy house.

I make an honest living and contribute into my 401K. I have a nice stash of money in my savings account that can tie me over for an emergency if I need it. I live in a modest but nice home and pay my mortgage. I drive a nice but modest car. I have one credit card I pay off each month. I live comfortably but not extravagant. Why is it that other people feel the need to go beyond their means and live on credit? Why do I have to bail out the greedy bankers and the irresponsible consumers? Why did the people who knew this train wreck was coming down the tracks--(and a lot of people knew about it)--they turned a blind eye. Why? Because people were still making money, found loopholes in the system to make a quick buck; even though they knew some day the bottom would fall out. They knew this day would come... but no it's better to just let the train fall off the tracks and derail over the canyon wall. Why did they allow this train wreck to just happen? Why didn't they stop it long ago? Was it fear or stupidity or greed? I think all three.

If you ask me, we have a serious cultural problem in our country that can't be fixed with bailout money. Sure, the money can put a patch on the financial part, but what about the root cause? The credit card spending habits and the "gotta have this right now" attitude? Last night on TV all I heard were people screaming "We have to stop the bleeding!" Well, I say more than stop bleeding, we need to get back to the fundamental cause and reasons why this happened in the first place. There is something very wrong with the culture. The fundamental values and the moral compass is out of whack.

I am an optomist. I think every cloud has a silver lining. I know that some day we will become better people from this terrible thing. We will learn lessons, pay the price, and hopefully never allow it to happen again. Greed is the root of all evil.

Link to comment
Share on other sites

Agree with so many of you. Hopefully we will all take a lesson out of what is currently going on and learn to stick to a budget - spend less than you bring home which yes, might mean making sacrifices like AnnHenry - riding the bus, driving clunkers, skipping vacation, not buying everything for our kids, etc. Hope all of these post will be motivation to those who are the unfortunate ones that are way in debt.

Link to comment
Share on other sites

Think it was mostly GREED. Why should we do a bailout? Why don't they do what they did in 1980's?. Bailed out then, but did not cost taxpayers only about a billion. According to Marcy Kaptur, Congress, and another man (did not catch it all), there is another plan available if they would just listen and it would not cost the taxpayers. She was on Lou Dobbs tonight and I missed most of it - just saw the very end. Am angry with our politician's actions and I just erased about 3 paragraphs of my ranting and raving.

Link to comment
Share on other sites

Archived

This topic is now archived and is closed to further replies.


×
×
  • Create New...