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December 13, 2008
the loss of babyboomer consumption
December 13, 2008
This week has been captivating for the economy. Jobs losses have topped 100k, talk of stagflation is upon us and the Auto industry was given a kick in the head under the guise of UAW philandering.
What is going on in America?
I am disgusted with the Business minds of today, where profit and greed brought forth popular corporate icons that became profit philanders in an economic downturn.
Where have our Grandparents gone? The generation who prided themselves on the number of employees they had versus profits in their pockets.
What happened to being the United States of America a proud nation that was by the people and for the people? Who replaced the vision of our forefathers with McMansions and bonuses?
As a thirty something who has had a short yet beautiful corporate life I ponder one simple question…
Why is the downturn a surprise?
Baby boomers (the wonderfully loved and equally hated parents of Generation X ) lost their minds.
You baby boomers are the biggest generation ever. Your population size is that of a small country and never once did you think what would have when you get old and stop spending. OH I forgot you will never get old right?
WRONG!
The surge of my youth was due to the great implosion of teenagers and college students born of Baby boomers spending flourished beyond marketing dreams. Minivans and SUVs were purchased in droves to transport us to Soccer games and the mall. Honda’s and Toyota’s were purchased as cheap sweet sixteen gifts. And 401k accounts flourished with dreams of never retiring in a rocking chair like our grandparents.
And never once did any of the paid corporate minds get off the merry-go-round of super consumption and to say what happens when this stops. What happens when its up to the next Generation (which is significantly smaller) to become the super consumers?
- Less cars are purchased because the Gen X parent boom is smaller. ( Baby boomers had less kids in order to have more remember).
- Purchasing on credit implodes because we never wait for anything (who needed to when parents bought us anything to make up for working, divorcing or anything else they felt guilty about). And who can afford a 100,000 starter home on $30,000 anyway?
- The stock market contributions become minimal compared to before because less people are investing and more people are moving their money out of the market into income funds or fixed assets due to retirement.
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Did anyone think of that?
