When will our economy change?
Over several decades of facilitating strategic discussion around the globe, 104 countries at last count, the number one question was how can you know when the economy, yours or global is going to change either upward or downward. Today in the US the question is paramount and again economists and others line up on all sides of the same question pointing in ALL directions.
Allan’s take: Follow the corrugated box industry globally and in your country or region. Almost everything gets packed and shipped in a corrugated box. The companies making corrugated boxes know the earliest when an economic cycle is going to change.
Today I talked to the head of global sales of one of the leading corrugated box making equipment companies in Phillips, Wisconsin. He told me things are going strong everywhere around the planet and especially in the usual suspects — China, India, Brazil.
Things have been going poorly in the US and are likely to GET WORSE. This means regardless of what the economists forecast the US is going to take at least another year and half to pull out of its current nose dive.
Evidence International Paper is GOING to announce later this month that it is closing a large number of corrugated box plants. Also Smurfit another large box manufacturer recently announced the closing of 9 plants. While some of this is due to consolidation, cost savings and increasing in output from new technologies the overall trend is corrugated boxes are going DOWN for at least one and half years. International Paper has stopped all capital expenditures for the next 18 months.
If this is not enough for you to accept my position read below. When illegal immigrants go home to find a better economy you can be certain yours is not doing very well!!
Send me your email and we will send you My Take on the coming Upturn.
Illegal immigrants going home
According to Mexican consulate officials in Dallas, some 400 immigrant families have told them so far this year that they’re going back to Mexico and asked for transfer documents to enroll their children in Mexican schools. Enrique Hubbard Urrea, Mexican consul general in Dallas, said it is impossible to track every Mexican who leaves the area. But he said the number asking for transfer documents at the consulate is on the rise.
In 2005, the consulate issued 162 such documents; in 2006 it was 199; and last year it was 270. At the current rate, more than twice as many people will leave this year as last, he said. “There is no doubt the trend indicates that the number is growing,” Mr. Hubbard said. And it isn’t happening only in Dallas. At the Mexican consulates in Chicago and Phoenix, too, the number of Mexican families applying for transfer documents for their children has increased.
L. Allan Austin
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Allan Austin is a business and strategic development executive consultant. His latest challenge is making social media mainstream. The physicist, Neils Bohr said, “A mind stretched to new dimensions never snaps back.” Allan stretches minds. Read more...
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November 3rd, 2008 at 7:40 pm
Allan,
The story below sums up my view of the economic issues today.
Mohamed
If you have difficulty understanding the current world financial situation, the following should help…
Once upon a time in a village in India , a man announced to the villagers that he would buy monkeys for $10.
The villagers seeing there were many monkeys around, went out to the forest and started catching them.
The man bought thousands at $10, but, as the supply started to diminish, the villagers stopped their efforts. The man further announced that he would now buy at $20. This renewed the efforts of the villagers and they started catching monkeys again.
Soon the supply diminished even further and people started going back to their farms. The offer rate increased to $25 and the supply of monkeys became so little that it was an effort to even see a monkey, let alone catch it!
The man now announced that he would buy monkeys at $50! However, since he had to go to the city on some business, his assistant would now act as buyer, on his behalf.
In the absence of the man, the assistant told the villagers: ‘ Look at all these monkeys in the big cage that the man has collected. I will sell them to you at $35 and when he returns from the city, you can sell them back to him for $50. ‘
The villagers squeezed together their savings and bought all the monkeys.
Then they never saw the man or his assistant again, only monkeyseverywhere! Welcome to WALL STREET.
November 3rd, 2008 at 7:47 pm
London: More than 16 billion pounds have been wiped off the fortune of India-born steel magnate Lakshmi Nivas Mittal, making him Britain’s biggest loser from the global credit crunch, a newspaper reported Sunday.
Mittal is among 10 super-rich Britons who have lost 23 billion pounds between them, the Sunday Times reported.
Mittal, Britain’s wealthiest man and head of the world’s largest steel company ArcelorMittal, remains a multi-billionaire, the paper said.
But Mittal’s family stake in the company has fallen from 33.24 billion pounds on June 4 to 16.63 billion pounds Friday – equivalent to losing nearly six million pounds an hour, or 137 million pounds a day.
The paper said the losses suffered by other billionaires pale in comparison to Mittal’s.
However, another Indian-origin billionaire to have been hit hard is Vedanta head Anil Agarwal, who is 2.7 billion pounds poorer, the paper added.