The local paper ran an article about the troubles of the airline industry. Last year they had 31 billion in expenses and 5 billion in profit, this year their expenses have almost doubled to 51 billion. Salem is losing it's airline service, after having it for about a year. Some of you may be surprised that this small town has airline service, and if you saw the tiny airport you'd be even more surprised. The airline is pulling out because of insufficient passengers. Another article was promising that we'd restore the service soon; I don't think it's ever coming back (and no great loss in my opinion). What's more, I think this year we will see that air travel is no longer an option for the average person. First because of the expense, and second because the airlines will no longer offer it for many routes.
What will happen to the economies based on the availability of air travel? Things like hotels, restaurants, convention centers, city budgets? As these businesses are forced to cut back due to diminished revenue, people will lose their jobs. As these people spend less, other businesses will be impacted, furthering the cycle.
Monday, July 28, 2008
Sunday, July 20, 2008
You have a front row seat
Sunday, July 20, 2008 - Salem, Oregon
They say an old Chinese curse is "may you live in interesting times". I'd like to welcome those of you living in the United States to what should prove to be a very interesting next couple of years. All you have to do is keep your eyes open, our nation is coming apart right in front of you.
Last week there was a front page headline about the Federal Reserve's emergency rescue of the two giant home mortgage corporations, the Federal National Mortgage Association (FNMA) and the Federal Home Loan Mortgage Corporation (FHLMC), better known as Fannie Mae and Freddy Mac. Jim Cramer (of cable's Mad Money) when asked how we'd know we have hit the bottom of the market replied - when all the banks that need to fail have failed, and when General Motors and Ford have declared bankruptcy. This is serious stuff. Last week there was also a run on a large California bank (Indie Mac - where do they get these names) causing it to be taken over by regulators.
There is much discussion of these things on the news (public radio and public TV at least), but where I live in Salem Oregon it seems like the average person on the street isn't worried and in fact isn't even thinking about this.
So I'd like to invite you to join me in watching this unfold. I plan to post what I observe happening around me here in Oregon. I'm wondering what it will take to get people's attention.
They say an old Chinese curse is "may you live in interesting times". I'd like to welcome those of you living in the United States to what should prove to be a very interesting next couple of years. All you have to do is keep your eyes open, our nation is coming apart right in front of you.
Last week there was a front page headline about the Federal Reserve's emergency rescue of the two giant home mortgage corporations, the Federal National Mortgage Association (FNMA) and the Federal Home Loan Mortgage Corporation (FHLMC), better known as Fannie Mae and Freddy Mac. Jim Cramer (of cable's Mad Money) when asked how we'd know we have hit the bottom of the market replied - when all the banks that need to fail have failed, and when General Motors and Ford have declared bankruptcy. This is serious stuff. Last week there was also a run on a large California bank (Indie Mac - where do they get these names) causing it to be taken over by regulators.
There is much discussion of these things on the news (public radio and public TV at least), but where I live in Salem Oregon it seems like the average person on the street isn't worried and in fact isn't even thinking about this.
So I'd like to invite you to join me in watching this unfold. I plan to post what I observe happening around me here in Oregon. I'm wondering what it will take to get people's attention.
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