GemWise: Outlook Tucson 09: Blood In The Aisles?

[Richard W. Wise]

GemWise: The Consumer Zeitgeist; Doing Penance:

"Sinful!!, now there's a word rarely applied to consumer spending, but in this economy it seems apt. The consumer zeitgeist has done a flip-flop. Several of my Christmas regulars told me that spending money on high ticket items in this economy just "didn't seem right". A number mentioned that they planned to boost their charitable giving. This holiday season, even high-end clients were looking with regret at their savings and check book balances---experiencing flash-backs of buyer's remorse and doing penance.

What this translates to is a return to basics. That may seem an odd word to apply to the purchase of a gem, an item with no nutritional value, but there are still occasions where a gem is more than just a sparkling frippery. I am speaking of engagements, weddings and anniversaries. Engagement implies commitment and that requires a symbol. Likewise, her twenty-fifth, a tangible statement of your gratitude for her willingness to put up with you for all those years---men forget such things at their peril. READ ON GemWise

 

[J Marcus]

I thoroughly agree. In my experience, couples still get married, even in times like these, though perhaps not quite as readily. ...and those significant rites of passage do keep happening no matter what else transpires.

I will also venture that I find it astonishing to see that many of the large, corporate entities are being brought to their knees by business downturns that seem to be within ranges that, though they might make for difficult times for smaller, more agile and less heavily leveraged firms, usually don't seem to spell their demise. I'm referring to downturns in business in the neighborhood of around 20% down to nothing worse than a very few percent or even just no growth. I think it obvious that far too great a number of the coorporate entities have been pushing the very edge of profitability in their drive to compete and have been living a fragile and perilous existence for a very long time, contrary to their appearances. The great tragedy is that so many good and hard working people are being hurt by this. It's going to be very interesting to see how the jewelry industry shakes out in the next couple of years. A few of the larger chains seem to have been on the edge of or even in and out of bankruptcy in the last decade or so, if I remember right. How the rest of us have positioned ourselves will undoubtedly determine our personal outcomes. Don't stand under any falling giants!

 

[pearlescence]

The problem here seems to be that the banks are not lending, and even worse, they are calling in existing business loans and overdrafts. Some of this funding would presumably be used to smooth cash flow - so that if you own a chain of shops and their rent is all due on one quarter day you could use overdraft or loan to ease that huge payment.
When that facility has gone you cannot pay the rent and you are in danger of trading while insolvent therefore.
Or maybe you need to buy in lots of ingredients to fill out a big order - again, no finance
or maybe no orders but still the wages and the rents and other on costs this week...
Some of the failures here have been pretty obvious as wobbling and failing for years but some pretty big names are having hard times as on costs stay the same but customers stay home

 

[Caitlin]

Isn't it interesting that so many collateral subjects bear on pearls? Pearls seem to be within two degrees of any other subject. LOL

Thanks to Richard for starting this thread and to jmarcus and pearlescence for adding such astute comments.