SOURCE : Candice Lee Jones / 15th June, 2009 / Kiplinger.com
These off beat barometers of the economy can give you much needed guidance for your portfolio or simply a good laugh.
Everyone is scrambling to get their fingers on the pulse of the economy. When will it turn around? Have we seen the worst? The answers may not be as elusive as you might think.
In the past, you might have relied on the old Hemline Theory to determine which way the market was heading: As hemlines rose, so did stock prices. Think model Twiggy in her super-short mod dresses of the '60s, followed by falling hemlines in the '70s as the economy weakened.
But these days you'll find all sorts of clues in everyday life to help determine where the economy really stands. Dry cleaners, for instance, may seem a bit more cluttered these days, and it's true -- many people are stalling an extra week before shelling out to pick up their clothes. Eyeliner sales are surging these days, and a cutback in eye makeup may signal a resurgent economy in which people are spending on costlier personal luxuries.
1. Packed Theaters
During the last seven recession years, box office sales have increased in five of them. The new Star Trek movie pulled in more than $200 million in the month of May, just one example
of how well cinemas are faring these days. According to the National Association of Theatre Owners, the number of movie tickets sold in the first quarter of 2009 increased more than 9% from last year.Better films? Hot new actors? People continue to fill theater seats, NATO says, because movies are one of the least expensive entertainment options out of the house. The average ticket price in 2008 was $7.18. So when the lines get shorter, go buy some stock.
2. Green Thumbs
The National Gardening Association finds that the number of households who will grow their own fruits, berries, vegetables and herbs this year is 19% higher than in 2008.
That makes 43 million gardeners in the United States this year. It's fun and relaxing, no doubt, but 54% of the respondents say the prospect of saving money on groceries motivates them to till the soil.
3. First Dates
Misery loves company, eh? Online dating service Match.com notices a pattern in its site activity during tough times. The fourth quarter of 2008 was their busiest in seven years (the site has been around since 1995). Match had a similar surge in late 2001, right after 9/11.
The company believes people are looking for someone with whom to try to forget about money troubles -- or share the pain. When the Dow Jones industrial average dropped to a five-year low last November, Match.com had its second busiest weekend of the year.
4. Romance Novels
The economy has broken your heart and stomped it to pieces and now you need to put it back together. At least that's what Harlequin, the giant romance novel publisher, says is happening. In 2008, Harlequin's sales were up 32% from the year before. In 2009, its sales are still rising.
The publisher credits this its uplifting stories that offer a haven, and to the low prices of the books relative to other entertainment. This theory has stood the test of time. Harlequin saw a similar sales increase during the recession of the early 90's. So if these stories start piling up unwanted on the discount table at the bookstore, alongside all those mis-timed guides to real estate riches, better news is on the way.
5. Droopy Eyes I
America is all tuckered out. A poll by the National Sleep Foundation found that nearly one-third of Americans lost sleep because they were worried about their finances. The 2009 Sleep in America Poll also found that 10% of those people tossed and turned specifically worrying about their jobs -- roughly the same percentage of Americans who are out of work.
6. Droopy Eyes II
Americans spent $10.3 billion in 2008 to endure 1.7 million cosmetic surgeries, which is 9% less than in 2007. The American Society of Plastic Surgeons cites the bad economy.
Without as much extra cash -- and facing depleted retirement funds and much less home equity -- fewer people can spend freely on plastic surgery. The number of liposuction procedures was down 19% in 2008 and tummy tucks down 18%. If you can get an appointment with a top surgeon without much of a wait, that's a sour sign for the economy. But, then again, maybe you can strike a deal.
7. Goopy Eyes
You've got that recession look in your eye. Total eye makeup sales at supermarkets and drugstores were up 8.5% in the one-year period that ended on March 22, compared to the previous year. In that time period, more than $260 million was spent on eye makeup -- in particular, eye liner was up 9% and mascara almost 13%.
The leading lipstick indicator -- the idea that lipstick sales rise in economic downturn as consumers settle for inexpensive luxuries -- is not holding up. Lipstick sales are down 11%. But eye make-up has replaced lipstick as the indicator, so the principle is the same.
8. Gators
What do 100,000 alligators have to do with the economy? The gators are all residents at Savoie's Alligator Farm, one of the largest alligator farms in Louisiana. The farm, which sells gator skin hides to tanners who in turn sell them to luxury designers like Louis Vuitton, has not sold a single hide since November, according to Savoie's.
This business is awful because people are not buying alligator skin handbags and luggage. The makers of designer labels therefore don't need to buy hides. This is tough on the gator farmers who are losing money fast and trying to keep the hides they already have in stock from spoiling. But it's good news for alligators everywhere -- if they only knew.
9. Dry Cleaning
The International Drycleaning and Laundry Institute is hearing gripes from many of its 5,000 members. The poor economy has customers are visiting less frequently and leaving clothes for longer. Weekly customers visit every two weeks, monthly customers visit bi-monthly, and some people delay their pickups even longer to avoid the bill. This has been a staple indicator of hard times before.
10. Mosquito Bites
We know the real estate bust has done a number on the economy, but did you know it can actually make you itch? In Maricopa County, Ariz., enormous numbers of foreclosed or abandoned homes have vacant swimming pools and unattended ponds. The stagnant waters -- known as green pools -- are a hotbed for mosquito breeding.
Maricopa County Environmental Services Department's Johnny Diloné says crews have treated more than 4,000 green pools already in 2009. During the same period in 2007, before metropolitan Phoenix's housing market collapsed, they had treated only 2,500. While most of the "green pools" are on vacant properties, some do belong to residents who just cannot afford to maintain their pools and ponds.
Copyrighted, Kiplinger Washington Editors, Inc
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