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Economy Improving! (You may quote any of the following in your newsletters, e-zines, etc. so long as you credit Brenner Information Group for finding this information.) For the last 20 months, service providers have had to deal with lower prices and lower revenues. Last year, billing rates dropped like a rock and revenues and profits evaporated. Then a bottom was reached, and prices began a gradual climb toward profits. Today, while the paradigm shift and down market that we described earlier continues, business conditions are getting better in some industries, and this will expand. Higher service prices are already appearing. As shown in the "Historical Average Hourly Rates" table (bottom of firstpage.html), average billing rates for graphic design are up 25% since last year. While the U.S. is beginning to recover, the worldwide economic slowdown is affecting every country in one way or another. Those who bought our Virtual Services Special Report and subscribed to our Real Prices Confidential online database are in a good position to profit as the economy improves. Once the U.S. election is over, watch for growing consumer confidence as buyers return and inventories are reduced. This will stimulate production and job growth. A bright economic sun line is slowly beginning to appear on the horizon. But it can't come soon enough. Here's what we see from our perspective: INDIA JOINS GLOBAL WOUNDED. India suffering 11.4% inflation, growing government deficits, and rising rates. Indian stocks plummet 40% from high of year. Growth slowing to under 7% suggesting that India's economy may have "hit the wall." — (Source: Business Week, 14 July 2008) FACTORIES BRINGING JOBS HOME AGAIN. Escalating costs of shipping forcing some U.S. companies to bring production back to North America and to freeze plans for sending more work overseas. — (Source: Wall Street Journal, 13 June 2008) ECONOMIC GROWTH FASTER THAN FIRST THOUGHT. Economy expanded faster in Q1 than estimated. — (Source: San Diego Union Tribune, 30 May 2008) U.S. RECESSION WILL END IN Q4. Federal government interventions and stimulus packages coupled with optimism about a new president will pull the U.S. economy out of this recession as early as Q4. — (Source: Global Services Media, 29 May 2008) HOME SALES INCREASING. Buyers Snatching Up Foreclosed Properties. Opportunities growing to make money in real estate. —(Source: Wall Street Journal, 27 May 2008) RECESSION? NOT SO FAST. Economy took detour on way to recession. Downward trend lines turning up. Stock and credit markets steadily improving. Economic reports stronger than expected. —(Source: Wall Street Journal, 14 May 2008) SLIDE IN INDUSTRIAL PRODUCTION SLOWING. U.S. Economic Data Still Causing Recession Worries —(Source: Wall Street Journal, 12 May 2008) PRODUCTIVITY RISES AMID U.S. SLOWDOWN. Companies are shedding workers and cutting hours to keep doors open and to be ready for rapid growth once the rush of buyers return. —(Source: Wall Street Journal, 8 May 2008) WE GET E-MAIL. "[Client]... stopped sending me their work and said they are [now] paying [just] $6 per hour for their transcription. I pay my people more than that. This [represents] around $3,500 revenue per month lost." —(Source: Recently received e-mail - April 2008) WE GET E-MAIL. "Business has been so lame lately that I'm about to give it all up and go be a greeter at WalMart!" —(Source: Recently received e-mail - April 2008) IS THE NUMBER OF HOME SALES STARTING TO INCREASE? Average selling price down 8.2% from last year, but unsold home inventory dropped 3% overall. —(Source: Reuters, 31 March 2008) STEEPEST HOME PRICE DECLINE IN 21 YEARS. Home prices dropped 11.4% in January 2008. —(Source: Associated Press, 30 March 2008) DISCOUNT RATE LOWERED 3/4%. Government slams loan rate down 75 basis points from 3% to 2.25%. Stock market rallies over 400 points. (Collapses again the following day.) —(Source: CNBC, 18 March 2008) ECONOMY STILL TANKING. Oil $111 a barrel, gold $1,000 an ounce, foreclosures up 60% since March 2007, retail sales weak, and gas pushing over $4 a gallon. —(Source: "America in the Morning" radio, 14 March 2008) INFLATION RATE RISING. U.S. consumer price index up to 4.3% from 4.1% —(Source: NewsMax.com, 24 February 2008) INFORMATION TECHNOLOGY HIRING TO DROP 23%-27% IN 2008 —(Source: Yahoo News; ChangeWave survey of 2,013 IT managers, 21 February 2008) ECONOMIC MELTDOWN MAY OFFER STOCK AND HOME BUYING OPPORTUNITIES. —(Source: MoneyNews February 15, 2008) MORE BAD CREDIT NEWS. Credit woes spreading to affluent parts of society. —(Source: Wall Street Journal, February 2008) MANUFACTURING INDEX (ISM) DOWN OVER 19%. Signals strong economic slow down. Dow drops 370 points. —(Source: CNBC February 5, 2008) HOME FORECLOSURES SURGE 75% IN 2007. Sales of New Homes at 12-Year Low —(Source: WSJ, January 29, 2008) RECESSION STARTING IN AUSTRALIA. Economies of Canada and China are also slowing down. —(Source: WSJ, CNBC January 19, 2008) DOW DROPS OVER 300 MORE POINTS. President wants to give cash to all American adults. Democrats immediately challenge who should receive money. It's going to be a rough ride. —(Source: Fox News January 18, 2008) HOME CONSTRUCTION lowest in over 27 years. —(Source: NewsMax.com January 19, 2008) RECESSION IS HERE! DOW Tanks 280 Points, Corporate Profits Collapse, More Bad News Still to Come. 2008 Will Be Brutal! —(Source: WSJ, CNBC January 15, 2008) CONSUMER LOAN DELINQUENCIES reach 7-year high —(Source: NewsMax.com, January 5, 2008) UNEMPLOYMENT RATCHETS UP TO 5%, manufacturing ISM index below 50 signifying recession —(Source: TV news, January 4, 2008) SLOWDOWN FEARS ROCK MARKETS - Dow down 220.86 points, oil hits $100/barrel, gold surges to $860/ounce —(Source: San Diego Union Tribune, January 3, 2008) |
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revised on July 30, 2008
