How Low Can It Go? We’ll Find Out This Week

The market crash of 2008 is upon us as the major markets tumbled almost 20% last week.  While there is some debate of the definition for anyone with a 401(k) or other investment vehicle this was a hard crash.  It could be about to get a lot worse.

There isn’t any good news coming from the major market players and the Government has done about all they can to improve the situation.  A meeting this weekend of G7 countries isn’t expected to result in anything earth shattering but instead guarantees that all bank deposits will be insured.  It’s a total mess and I think anyone not on vacation for the last two weeks has seen the immediate impact in business activity.  We talk to vendors and even friendly competitors on a daily basis and business went off a cliff after the first bailout attempt failed.  Anyone and everyone we talk to from the local restaurants, gyms and contractors report whatever business was going on slowed substantially the last week of September.  Worse many report tightening credit lines which will only continue to stagger our weak economy.

CNBC’s host Jim Cramer has some interesting thoughts on where he sees the market potentially going next week.  He has taken some serious criticism for his blunt comments about the market while many others continue to announce the “bottom” only to have it smashed through later that day.   What I cannot understand in listening to the experts is how they think the  market will bounce back solidly when we are heading into a global recession if not depression?  If you read Cramer’s article  you’ll see he makes that very point, our economy stinks and is getting worse fast.  He seems undecided on whether this is more like 1929 or 1957 and I applaud his honesty in not trying to tell us he has it all figured out like so many other experts on TV that may well be covering their own positions.  Futures are sharply lower already for Monday and barring a last minute rabbit out of the hat by the G7 it could be a very ugly Monday.

There isn’t much any of us can do about it.  We’re working harder days and longer hours to grow the business and there’s really no choice.  What has many people worried is the constricting credit lines heading into the holiday season which will stifle retail sales which trickles back through the entire economy including the promotional products industry.  It’s a scary time but all any of us can do is focus on what we can control which is our individual budgets and sales.  Unlike earlier contractions the industry itself seems weaker already with the telltale signs that some vendors may be feeling the financial pinch.  In 2001 and in the early 90s the organizations were strong enough to mostly weather the storm, I am not sure that is going to be the case this time and when this is all said and done the industry may end up looking very different.   Some are already expecting major consolidation like we’ve seen in the banking industry.   Times, they are a changing as the saying goes.