Sunday, March 8, 2009

Think Unsexy Thoughts... Think Unsexy Thoughts...

Things I hate at the moment:
1) People who change their Facebook status to describe how close they are to completing a assignment (Your life called, it wants you back)
2) The current recession

I know its not a very long list and I'm sure if I sat down for more then a moment, stopped taking extra strength Advil (I have the flu) I'm sure I could come up with a whole whack of other things I hate (like men in flares, there! there's a third!)... But for now I'm keeping my hate list at a manageable two; I even refuse to hate the Jonas brothers (I have a minor crush on the youngest Jonas, who is, yes - 16; desperate times my friends, desperate times indeed) and if you can't find it in your heart to hate the Jonas brothers I mean, what else is there left to hate?

My commitment to be less of a hater is in part due a march break resolution of trying to think more positively about life. I had a boyfriend once (yes I know... its true) who was deep into positive thinking and tried to convince me about its attributes. This gentleman caller argued that by thinking positively about a situation I could actually effect the outcome. Sort of like a self fulfilling prophecy, where the prophecy is like a room full of bunnies and chocolates. Its a nice thought, isn't it? But... I mean - its not like I walked into my finance exam last week thinking, "Glad I didn't study, if I just think positively I'll pass." Now of course I did think positive net present value, but that's a whole other WACCy story (finance joke!). Anyway I feel like there are limitations to positive thinking's efficacy but still I'm willing to be a believer at least for the next little bit.

Within this positive thinking headspace I've decided to ignore the current recession. If you're response is: "What recession? There's a recession?" You may be an idiot or you may be an heiress, but regardless you're also the type of person I'd like to befriend. We can be clueless together. Because what's positive about a recession? Nothing I tells ya, nothing. The recession is so fucking depressing and on top of being a big debbie downer I think the recession is actually a self-fulfilling prophecy, but not one of positive thinking but of negative thinking.

Hear me out: is it possible that this godforesaken Great Recession, as some chaps are calling it, is simply expedited by the crisis of the consumer? As credit markets have tightened the American consumer has stopped the majority of its spending. No more mocha frapuchino's while buying the latest Coach bag... Keynsian economists, quoting his oft used General Theory, would argue that pumping up consumer spending is integral to the restarting the circular flow of the economy. However, as consumer confidence continues to fall (February 2009 marked the lowest level of American consumer confidence in decades) the economy contracts further. The harsh reality is that consumer spending accounts for something like 60% of the Canadian economy. Its a vicious cycle. So WHY aren't we spending? Negative thinking!

Think of it this way - you're a partner at a large management consulting company in downtown toronto - let's call you Mavid Lecaut and you're a partner at the Toronto Consulting Group [TCG] (everything at this point is purely hypothetical). Anyway - at TCG your clients are major fortune 500 companies, every day when you wake up and read the Globe and Mail and Financial Post you're inundated with hyperbolically bad news about the economy. By the time you get into work and start thinking about monthly billings at TCG (how many hours clients are using your high priced conslutants) you forecast that future billings are going down the crapper. You sit and think to yourself, why the fuck am I paying people silly salaries and why am I hiring new staff and interviewing for summer positions - when there is NO work. NONE. COMPANIES ARE GOING BANKRUPT. So Mavid Lecaut, smart man that he is, tightens his belt (from last seasons Harry Rosen FYI) and lays off some staff, stops hiring summer students... the whole deal. Anyway long story short, suddenly you have an angry ex TCG staff member not buying cashmere blend sweaters at Banana Republic, then it looks like Banana Republic is going to have to lay off some of their part time staffers too. Suddenly that part time Banana Republic employee who spends something like $150 a week at Fly on Friday night on shooters is no longer going to Fly, and they're contemplating laying off a bartender as well... Before you know it half the city is on the dole, the other half is employed by the provincial government, but don't worry because they're working on a creative economic strategy. Do we see how this vicious cycle effects everyone from your corporate CEO to your shirts off bartender at Fly? Its like the ebola virus. No one is spared.

On another level - you think I bought that cashmere sweater I was fondling earlier today at Club Monaco. HELL to the N-O. Have you read a newspaper lately? There's a credit crisis. I'm lucky I have a roof over my head, CIBC could revoke my credit at any moment. That weird Caisse de Depot thing they have in Quebec lost almost $40 billion dollars over asset-backed commercial paper. I don't even know what asset backed paper is. Why would I buy a cashmere sweater? Can you eat cashmere? I'm looking at cold hard assets: land, diamonds, gold. Fiat money? That's so yesterday.

Anyway - my point is that this recession business can quickly spiral way out of control the more the media portrays it as the Great Recession. You're all frantic now aren't you? I'm freaking my shit out while writing this wondering if the end to world economic order is upon us, contemplating purchasing a couple of acres of farm-land so at least I could feed myself. You're probably cashing out stocks and RRSP's wondering if you should start storing money under your mattress like your grandmother did during the Great Depression. Lot of good those Laboutins are going to do us now, unless of course people start forming gangs when world economic order collapses and one of the gangs is called Lord of the Rings and their territory is Holt Renfrew and they've made weaponry out of last seasons Laboutin heels... IT COULD HAPPEN.

So what should we do about it? How can lowly old you and lowly little Jono make a better world? Well... let's all think positively! Come, join me. Join me in the world of conspicuous consumption. Everyone - grab your credit card, hit the mall and spend, spend, spend. Worst comes to worst, you'll be bailed out by the federal government, right? And at least you'll lack fabulous at the hearings!

To quote Marie Antoinette [herself well known for thinking with her head in a time of political and economic instability]: Let them wear Club Monaco.


Garrett Saunders said...
This comment has been removed by the author.
Garrett Saunders said...

Lots of mass market ideas will be purged because of the recession, but just because many business models and ideas focus on the share of market, and marketing to the masses, doesn't mean opportunity has been given the boot.

Recessions are a great time to do something niche (think Google back in the 90's) focusing on the share of wallet, one customer at a time.

Companies who prevent themselves from becoming top heavy and fat during good times, fare much better during bad times.

The opportunity is there, you just have to find it.

Small is truly the new big