Every year retailers ramp up the sales and hope to get into the black (hence the name) on the day after Thanksgiving.  Either we are or are not in a recession, depending on who's information you wish to trust.  Government talking heads like Bernake and Geithner will have you believe one minute that there is no longer a recession and the next we're teetering on the edge of destruction.  It all just depends on what headline they want on what day.  Is it a Manic Monday, a Terrific Tuesday or a Whacked out Wednesday?  It's like playing a game of 52 pick up, but the jokers aren't in the deck, they're tossing the cards into the air and  making up the rules as they go.  And the deck is clearly a bit short.

How one defines a recession seems to vary a bit.  Statistician Julius Shiskin, in a 1975 New York Times article, described a recession as "two down consecutive quarters of GDP".  Others suggest an unemployment rise of just 1% in a 12 month period points to a recession.  Let me give you the unofficial Texas definition of a recession:  If a rancher has 200 head of cattle, plenty of grass and good water, then a drought hits, rain fails to fall, the grass dies out, he's forced to dump cattle on the market, which in turn helps to create a glut of beef, which in turn helps push the short term cattle prices down, leaving the rancher with no grass, no water, few if any cows left and not nearly as much money (or capital) as he had to start with-that is a recession.  And what affects that rancher will, down the line, affect everyone else.  But isn't it all just part of the cycle?  The economy is cyclical.  We have highs and lows.  But the lows of late are a little too low for most of us.  Make no mistake, our nation is in a recession.  And fear of a depression has been on the horizon for two years.  Market Watch's Paul Farrell predicted in 2000 and in 2004 that the dot com bubble, the housing bubble and financial debacles like AIG and Goldman-Sachs would lead us down the path of double-dip recession and eventually a second Great Depression.  His dire and sometimes outright bleak visions have, at least in part, come true.  But is all of this true calamity or some type of self-fulfilling prophecy?

Right here in Wichita Falls, as I bang this work of art out on my brand new Dell keyboard, gasoline is $3.09 per gallon, diesel is $3.59 gallon and the price of just about everything has gone up by double-digit percentages since 2008.  The key to much of what ails us is the price of fuel.  We just cannot expect the average person to go out and spend money on TV's, iPads and XBox's if they must continue to pay through every orifice of their bodies to go from point A to point B.   Don't worry, they will.  But is it fair to chastise someone for not doing so, especially when the economy so desperately needs for them to do so?   Is it almost a moral obligation to give till it hurts?  There's a whole other post just in that question!  Yes, for better or worse, cheap fuel would go a might long way toward fueling the economy.  But our problems go so much deeper: the mass exodus of manufacturing to China, the spend-thrifts that occupy Washington, DC, Obamacare, the ever-increasing needs of the Baby Boom generation; the list goes on and on.  We keep hearing about 'austerity' measures in Europe.  Why does the media keep throwing that word around?  Two-thirds of the American people don't have a clue what it means!  Simply defined, austerity means cutting spending and scaling back the cradle to grave style of government that Europeans have long enjoyed.  Many American's have enjoyed similar benefits, although we don't have nearly the level of government-mandated and government guaranteed benefits that some nations enjoy.  And it's a good thing we don't.  We still have a chance to pull away from the edge of that cliff.  Again, another entire article lives in that issue alone.

The whole idea of some self-fulfilling prophecy where the economy is concerned can, I suppose, cut both ways.  Could retailers will themselves into a Black Friday cash bonanza?  Could the media possibly hype things up enough to make or break things for the Wal-Mart's and Best Buy's of America?  Is perception truly reality?  The answers are no, yes and yes, sort of.  It's been a long, long time, but I have worked in the retail industry.  I did everything from cleaning toilets to selling paint, furniture and guns and ammunition.  People haven't changed all that much in my opinion.  We still buy things we want when we want them.  And Christmas is definitely the season of want.  But there are some fundamentals today that didn't exist 20 years ago.  High unemployment-we've been down that road before, but it's of much greater national concern today, right?  Or is that the perception?  People definitely have more debt to contend with.  The wants are more numerous and expensive (priced an iPad lately?) and the world economic woes are weighing on us more than ever.  Or is that just perception?  No, it's not.  It's real.  This is what happens in a 'New World Order'.  You tie a bunch of economies together and it's a house of cards-knock one down, the others will follow.  Not much is truly independent any more in the marketplace.  High fuel prices are the real deciding factor for Americans.  Be honest, are you really going to be able to spend what you'd like to spend as long as your paying $3 per gallon for gas?  If the liberals have their way, it'll be $5 per gallon or more eventually.  After all, that's good for the environment!  Sure it is.

Everyone wants to score big on Black Friday.  Retailers want the registers to ring like church bells.  Consumers want to score great deals on all that they touch.  But there's a middle ground that, if we're being honest, has always really been there.  You do have to weigh all the factors; what do I want, what can afford, and what's it going to cost me down the road?  With the easy credit of the late 80's and 90's, it was easy to forget all of those things, but they never actually went away.  Eventually, someone's got to pay the bills, right?  The loose credit days are gone.  People are thinking more about what they spend.  Not everyone, but certainly many, many more people are forced to do so in the face of wage cuts, layoffs, etc..,.  All that said, three things are clear: I am going to shop for certain individuals for Christmas, I won't spend what I would like to be able to spend and I'm going to burn a considerable less amount of that $3 gas this year doing it all.  And my hope for all business people is that you do get into the 'black'.  You just might not get as far as you'd like.