WOW! The Recession is Over Just in Time for the Holidays!

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This is another long post but don't give up on me. I'm going somewhere fun with it in the end!

I heard on the news yesterday that the recession is officially over. I think our government press agents and financial experts have been watching a little too many Kevin Costner re-runs ala "If you build it, they will come" hence, "if you tell them it's over, they'll believe it." Clearly they think we're stupid. And if we really did have anything to do with electing most of them, we are. I'm not convinced. I think in generations to come they will discover that our corrupt "government" somehow tinkered with the electronics and the polls and somebody sold our livelihood off for their own personal, financial gain. So many of my friends secretly admit they would leave this country in a heartbeat if there were anywhere to go, any way to get there but then I have friends in other countries who share our disdain. It is global. That's a fact.

Here in California we have a satirical cast of mid-term candidates. Carly Fiorina - elegant, beautiful, well spoken.

A former big wig at HP who tripled her salary after outsourcing thousands of American jobs to Asian countries bought five company jets and herself a private yacht.

Meg Whitman, ugly as a mud hen.

Her commercials have been running in California for years and she certainly hasn't found success with her looks. No, not at all. She's the "Fee-Bay" in "Ebay". According to campaign commericals she's the CEO responsible for raising Ebay fees so high that (as we know from the Etsy forums and personal experience) many private sellers had to give up their small businesses because it was no longer viable to sell small ticket items with the inflated listings. She also brought EBay to China which pretty well put small time American sellers out of business. I'm sure she'd be a great politician for the people of China. Too bad for her, they already have President Hu Jintao.

Then there's Jerry Brown.

He's been a piece of work for decades but now he's saying that at this point in his life he's ready to do the right thing. Well Jerry Brown, it's a little too late to do the right thing now.

I wouldn't even know all of this if it weren't for their constant interruptions in a 30 minute episode of "Jeopardy". I'd like to see the producers of Jeopardy put together an episode "Former President's Jeopardy". Can't you just see the candidates Clinton, Carter, and G.W. Bush.


And now the frosting in the middle of the cake. Residents of Bell, California discovered this past July that their city officials were paying themselves twice what the President of the United States is making. Outraged citizens stormed City Hall, brought in the media, and yesterday September 21, 2010 all 8 Bell City Council members were arrested. It seems now they are only the first in what is likely to be a wave of many more to come. The average income of Bell residents is $32K. There are 36,000 people and 9,000 homes in the city of Bell that have been forced to fund the City Councils $5M annual salary pay for 8 members.

Politics and politicians aside, I'm guessing that this latest news of the recessions end is somehow connected to the government hoping to boost 4th quarter gain - particularly in retail through the holiday season. Interesting they announced the news conspicuously before the end of the 3rd quarter, and the same week that all of the malls are starting to assemble holiday displays. The end of Labor Day is typically the beginning retail's biggest season. It's biggest boost peaking between Thanksgiving and Christmas. Not to mention that officially ending "this" recession gives way for opportunity of labeling these years as a "Double Dip Recession" rather than a "Depression" as we are expected to really hit rock bottom 2011. You can take a piece of chocolate and wrap it up in fancy gold foil and sell it for $40 bucks - Hershey's or Godiva, it's still chocolate. A Recession, a Double Dip Recession, a Depression - label it as they will, it is what it is.

Let me preface this by saying, I'm no stranger to what individuals and small businesses are dealing with economically these days. Being a free-lance bookkeeper who has been trying to navigate this "Recession" since 2007 by literally moving 3,000 miles and back with pit stops in between - I've seen it firsthand from coast to coast. We knew when it started in California that the housing bubble (900 square foot Sears Craftsman houses built c. WWII near the coast selling for $1M and up in 2003) had burst by 2007. Well over half of our bookkeeping clients at the time were 100% invested in real estate. Many of them navigated their investments out of California by buying foreclosure homes sight unseen, online, in places like Detroit where a 2,000 square foot foreclosure home was under $40K. They thought they were snapping up bargains but at the time, nobody foresaw the demise of of the auto industry, and our California investors had never ventured to the upper midwest at all, much less during a winter of freezing pipes, roofs collapsing from snow, etc...
The other half of our bookkeeping clients were actively working in the entertainment industry which in 2007, was also failing miserably. Studios were closing. Struggling production companies were hanging on by moving to less taxed states and countries like New Mexico and Canada. Four months behind on our rent in an apartment we'd had for ten years and never been a day late with, we left also. Our landlord was actually willing to give us more time but with the view we had we couldn't see an end in sight.

The move to Tennessee was a risk, and it failed but in hindsight I don't honestly think any options were fool proof. The move to Dallas was a calculated accident. Typically, if you're living in the state the sitting president is from, you have a much better economic situation to work from. My parents learned this in the years that my dad's job was transferring him annually. My mom and I tested the theory over the years that we were traveling around selling art work, and later crafts. Dallas was definitely feeling the downturn last - not surprisingly given that Bush will be a couple of years out of office before the mortgage (and foreclosure) disaster is suppose to hit rock bottom in 2011. We bought some time there but what we saw businesses dealing with financially mimics what we were seeing in California 2 to 3 years earlier. One example, contractors were running commercials offering home repair and improvement at cost, just to keep their staff employed. Having roots in Texas I know, nobody squeals louder than a stuck pig unless it's a broke Texan.

I had been talking to friends in California all along who agreed that "the economy was finally leveling out but it's leveled out at such a low level it's hard to comprehend." And so it is. A contractor called me recently about bookkeeping. He has been in business over 35 years and until three years ago had been running $3M in annual revenue. His business has sunk to $60K. He's faced with cutting all of his employees, and working basically like he did when he started out 35 years ago. It's a tough reality, especially for a 60 year old man. Numerous companies have taken on massive credit card debt at 18% to 30% APR to cover basic operating costs. Unable to make the minimum payments they are in serious debt. I've even run into companies who have intermingled casino gambling in the company operating accounts (a HUGE no-no with the IRS), and a sad, desperate attempt to keep hope alive.

So back to 4th quarter, holidays, and reality. The best financial advice I've heard was a man on the news a couple of years ago who owned a pawn shop in Palm Beach, Florida. The mega wealthy were liquidating family heirlooms at the time to cover basic expenses. This was BEFORE Bernie Madoff. That's a good little eye opener for the rest of us. If the rich are broke, middle class is broker. What this guys said was, "buy bags of dried beans, dried rice, and what you need to get by and lay low." He has a valid point.

Running around like chickens with our heads cut off the past few years hasn't gained us anything. I still don't regret leaving L.A. but I know the worst isn't over. We have waves of income. People come with bookkeeping because they think if they get their books together they might find a loan or grant money. Two or three weeks into it and we have to give them the reality - you may have had a successful, multi-million dollar business a few years ago but now you're buried in credit card debt at maximum interest because all of your payments are late so you're also buried in late fees, your bank has been covering your payroll checks for months (and in many cases years), you're years behind on your taxes. Ain't nobody gonna give you a loan. It's a brutal truth to tell and one that's never gracefully received.

And I should add, you're not a failure. Your country failed you. My country failed me too. And in the words of my grandmother, "pull up your boot straps. you've got some work ahead of you." Buy dried food, canned food, stock up. Buy paper goods, buy soap, shop sales. Pay your utility bills ahead. Cut out superflous expenses - do you NEED 300 channels of cable television? Think! Be practical and minimalistic in your choices for the next year or so. And when the government puts out bulletins that the recession is over, don't buy into it. Don't blow all of your money on extravagant holidays. If people can't reciprocate they'll feel badly about it and if you're just doing it to show off remember, you might rather have electricity and gas this winter.

Which brings me to where I was headed with this in the first place, what are your ideas for low-cost, no-cost holiday gifts. I have a few and I thought we could share.

* I have a friend who loves to cook and he's constantly scouring book stores for particular types of recipes. I recently found a website that has thousands of recipes for free so I've started compiling some that I think he would particularly like into a digital cookbook. I'm setting it up in a .PDF format that will download to his Kindle DX which I know he will appreciate.

* I have several friends with young children that I don't really know but I always like to send them something special for the holidays. One of my favorite things to get into at my grandmother's house when I was a little girls was her stash of paper dolls that she had collected from newspapers and magazines since the 1920's.


I recently googled paper doll downloads and found thousands for free. I have a an excellent color printer - so this should be a fun, inexpensive gift for the girls. For the boys I love this site!

Actually, there are some fun projects here for girls as well.


* If you have any scrapbooking friends
this is also a fun link from the same site.

* If you have friends that knit or crochet there are tons of free patterns online. I even offer a download now">free scarf pattern

through my Ravelry store - a scarf easily knit from scrap bits of yarn.

* Another idea for your knit or crochet friends might surprise you. There is a huge trend right now in recycled yarns. Literally, yarns that are from sweaters picked up at Goodwill or garage sales. Simply clip a sweater at one end and start unravelling it into balls of yarn. No kidding! People sell these all over the internet and unique yarns are highly sought after.

* One I really love, and would love to have, is family pictures. Do you have a stash of great old family photos? Download them on discs or have printed copies made for family members. You can scan and upload them for free to Shutterfly. From there you can make photo gifts, photo albums, inexpensive prints, discs, and even create a share site like mine for free - where family and friends can also contribute and make their own purchases.

* If you are the family chef, make a recipe book or box of your own family recipes. This is a great gift to children, grand children, or a new daughter in law. A friend of mine's mom was dying a few years ago after a very long battle with cancer. She was a remarkable cook! In the end the family was making plans with how to distribute her belongings. My friend kept saying he didn't know what he wanted out of her world of collectibles. I said you don't want any of it. You want her cookbooks. When you miss her you will miss the foods she made you at holiday, on special occasions, to comfort you. He didn't listen but he should have. What a treasured gift!

* My adopted great-grandmother had 19 children. She died decades ago but the item that is most treasured of hers still is the hand written story she left behind of some of her childhood memories. There is more to life than gizmos and gadgets.

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