Making Sense of it all

First a shameless apology for lack of recent posts. Ok, enough of that.

I have heard conflicting messages with economic data releases and general news about the status of the economy, recession vs. slowdown, housing slump or crash, mortgage crisis, credit crunch, and so on.

For those of you who have been living in a hole lately (good for you, by the way), here's a quick update:

Comparable retails sales were reported up 3% in May by UBS-International Council of Shopping Centers (I couldn't find a Web site, but go here for the Google search), and orders for manufactured goods surprised analysts by increasing; in the same breath (or gasp as the case may be), unemployment hit 5.5%-- up .5%, the single-largest one month increase in 22 years-- household net worth fell almost 3% for the 1st quarter of 2008 and 49,000 jobs were lost last month.

In general news, the US Bureau of Economic Analysis released 2007 numbers for gross domestic product by state, considered a measure of local economy. I looked through the dizzying report personally, and even the explanatory notes need explanation. But if you've a hankerin' for a light read, go here to see for yourself. I'll take the Seattle PI's word for it (because everything that we read in the newspaper is always accurate), we tied with D.C. for 3rd place. Forgetting the Benjamins, Check out the Washingtons!

Everyone seems to have an opinion. Even me. But what does it all mean, you ask?


Truth be told it seems rather difficult to categorize just how 'we' are 'doing.' I could have told you that... oh wait, I just did...

For Washington State we can look to local statistical reports (here's some commentary if you've got the notion), and according to bea.gov -- the dizzying report I mentioned earlier-- we're in the 'highest quintile' so that should be good for something. Not cheaper gas at $4/gallon or a job with unemployment is the highest it's been since 2002 (gas and job being national numbers), though. Add housing supposedly imploding and the economy alledgedly tumbling into a recession, and what's a father of 6 to do? We have to sleep and eat somewhere and get everybody around somehow!

Here's my remedy:

1) Stop paying so much attention to the news. After all, it generally tells us what has already happened and there's no sense living in the past. If it weren't for the direct correlation to my job, I think I'd ignore it altogether. I'd still paruse the ads to oogle over the latest tech gadgets though, so all is not lost.

2) Rely on meaningful sources of information for direction:
For consumer spending data, that would be my wife who manages our household budget in addition to the myriad of other daily tasks involved in running our household of 8 (thanks honey, sure do love you).
For housing information, that would be date from the NWMLS and local experts. 'Trust real sources, take others with a grain of salt' is the old addage. Well, a few minutes old at least, by the time this gets posted.

3) Sit down with my wife in her copious spare time, and re-evaluate the family budget to see if there are any adjustments that can be made to compensate for changes in the economy/market/cost of milk and gas, as appropriate.

4) Realize that housing prices are fair and mortgage rates are at historic lows. And you know, it's really not that difficult to get a home loan, contrary to popular concensus. If you know someone who is considering buying or refinancing a home, have them call me so I can help them work through their options.
"Cause Knowledge is Power!" -- Schoolhouse Rock

These four steps will hopefully give us all a little nudge toward meaningful and realistic sources of information. Especially number 4 - that one's my favorite.

As always, thanks for reading!