P&G executives say many of its former middle-market shoppers are trading down to lower-priced goods—widening the pools of have and have-not consumers at the expense of the middle.
That’s forced P&G, which estimates it has at least one product in 98% of American households, to fundamentally change the way it develops and sells its goods. For the first time in 38 years, for example, the company launched a new dish soap in the U.S. at a bargain price. […]
Economist Edward Wolff of New York University estimates that the net worth—household assets minus debts—of the middle fifth of American households grew by 2.4% a year between 2001 and 2007 and plunged by 26.2% in the following two years.
h/t Joe B.
Obamassiah . . . the -26.2% President.
Now that’s a record he can run on.
Oh wait . . . . maybe not.
Is there nothing Obama can’t contribute to?
Recently there was a comment that came to my attention, possibly here, stating the veterans from the wars America has fought for western civilization would be moving into the political arena.
I have every confidence the U.S.A. will not only rise to the future requirements, but will excel.
When this starts to become reality I will return my investment portfolio to include a large percentage of U.S.A. equities. Cheers;
I have a ‘friend’ in the upper echelon of a personal care company. Their company already charges more in CHINA for equivalent products they also manufacture here. The company is now getting ready to launch new, even higher end (and more expensive) products exclusively for the Chinese market. Chinese consumers don’t want ‘regular, common’ goods, they’ve now become accustomed to their new wealth and are expecting higher quality than before.
When I asked if there would be a similar product launch in North America, the answer was no “because the market can’t support it.”.
A sad day indeed.
Even those households that have employment are worried that the employment isnt permanent. So there is a general pulling back on conspicuous consumption.
Add this to a general deleveraging of households
Add this to the wealth effect of having house prices in the US fall, and Canadians being worried that theirs will fall
Add this to the wealth effect of those with stock and mutual fund assets seeing a general slide and a worrry that 2008 could happen anythime.
All this adds up to consumers, who normally would bybased on brand, image etc cutting back to straight practicalities and dollars and sense on goods they use everyday.
Look at the TV shows, pickers, pawn shops, storage locker biddding and couponing. Focus on down rent co-horts like Jersey Shore
Its the way it is. The culture will change, and the economy will change, but it can go for years.
Now I ask you to do a what if, and think maybe we should be thanking our luck.
What if John McCain had won. Most of this might still be happeneing. Then the hopey changey message might have come in 2012 with a sweeping of the house, senate and presidency with a full mandate much stronger than in 2008 when it was just about being enamoured by a personality than an ideology.
Perhaps in the long we have dodged a bullet. Assuming 2012 results in The One being a One Termer.
Quite right, Stephen. The public always votes their wallets.
Mike, the Iraq-Afghanistan crop will be entering public office in five to 10 years. It’s gonna be a long ugly drought for the Democrats.
Red-Green Depression Glass Free.
Free with every purchase of a box of green recycled O’Groats.
See our ad at Tommy’s co-op.
So if I stop overpaying for shampoo, am I disappearing the middle class? Or a lucrative market for P&G. I don’t think they are the same thing.
Most great countries begin to decline 225-250 years after their founding.
I would be one of the last to defend the Marxist Obama in any way, but the difficulties in the US started a number of decades ago and only have become more visible in Obama’s term in office. Frank Q. has a point. The entitlement mentality has overtaken the yes we can a build a country mentality.
It will take a strong leader to overcome this and of one does not come along the decline will continue. History is not mocked.
I stand behind this comment from 2009
http://www.smalldeadanimals.com/archives/011945.html#c412425
Tim,
While P+G has its share of mistakes it definitely spends a great deal of time and resources litening to and mirroring its customers.
It may appear trite but I would take it as a serious signal of trends in the mass.
They made lots of money sellign overpriced shampoo because they knew how to do it. They havent forgotten, but if people arent buying then you try something else.
As an indicator of whats really going on in the economy I’d trust the actions of P+G more than the words of a politician.
anybody wanna be part of my Amway organization?
LOL !!!
Even so, CapitolFax has a link to a more important article, with comments by Caterpillar CEO Doug Oberhelman:
“We cannot find qualified hourly production people, and for that matter many technical, engineering service technicians, and even welders, and it is hurting our manufacturing base in the United States,” he told a business audience at the Spruce Meadows equestrian facility outside Calgary.
“The education system in the United States basically has failed them and we have to retrain every person we hire.”
——
Read that again.
“We have to RETRAIN EVERY PERSON WE HIRE.”
That means that even if America starts to rebuild its work force right now, it won’t be competitive with the low-cost Asian producers ***for a minimum of TWENTY YEARS***. Which is the length of time it’ll take today’s 0- through 5- year olds to get through high school and trade school, presuming their educational system starts improving today.
Yikes! America’s in for a bad time.
I’m thinking of starting a business which books space at casinos in which to hold and supervise examinations. I’m going to call it “Proctor and Gamble”…