One Year Later: Getting a Better Perspective

I think the hysteria may be subsiding. It’s been a year since an already deteriorating economy spiraled into a meltdown scenario. Jobs have been lost, banks have failed, mortgage companies have failed big-time, retail companies have failed, other companies have failed. Then there was what many believe was a watershed presidential election and whether you think things have been good or bad there have been some profound changes since that election and there will undoubtedly be more to come. The first reaction for everybody a year ago when the economy collapsed was absolute shock. How could this be happening to us? Why can’t this unrealistic lifestyle last forever? I deserve it. We deserve it. We’ve been able to use our homes as a virtual ATM. Everybody gets credit—and lots of it. We can’t fail. But we did fail. I’m going to actually have to stop eating out five days a week, some of us finally realized. Geez—I forgot how to cook. Then the months passed and we had to adjust, it wasn’t easy. OK — it has been a year and I’ve been talking to a lot of businesspeople and consumers about how they are doing with their businesses and lives — and how they are feeling. The hysteria is over, I think. They are learning to deal. Some are reinventing themselves. But most are saying that they think the past year will bring profound long-lasting changes to our economy and our country. They also believe there will still be a world of hurt coming down the pike in the next year — but all are optimistic we’ll get out of it. People aren’t as scared because they see some people actively engaging in the economy. They are at least buying foreclosed houses. They’re not necessarily buying at the retail stores but the Cash for Clunkers program shows that they’re not opposed to buying — if they have a good incentive. People at business networking mixers are actually talking in detail about how good or bad their business is doing. A year ago, when things were plummeting, they were just stunned and didn’t want to say anything. They know how to maneuver through the downturn better now so they feel better about themselves. They’re being creative. They’re being very philosophical and analytical about what all this means for the future of our economy, here locally and beyond. Some say that it is the end of the small, risk-taking entrepreneur as we know them. The really niche retail businesses won’t be cropping up anymore unless the owner is personally flush with cash. I’m talking about the cupcake stores and the chocolate covered strawberries shops. They’re not going to get the loans that they used to. But there’s also the view that if it’s a good business with a good business plan it will get the money. Many businesspeople are saying that good, solid businesses will survive. The smart ones are still looking forward to the next five years and beyond. Business Journal Editor Jason Schaff can be reached at (818) 316-3125 or at [email protected].