How Much is $600 Billion?
Wall Street’s plunge yesterday shed $600 Billion from investors. Merrill Lynch is no more after 94 years bought by Bank of America (BofA bought LaSalle who bought Standard Federal who bought Michigan National who bought…..). Lehman Brothers bankruptcy is the biggest ever and we already know what happened to Bear Stearn, Freddie and Frannie.
Here is the irony. Oil is near $90 a barrel, a full $50 lower than just a couple of months ago. Gas futures have dropped below $2.60 and commodities in general have plunged. In fact, August might be the first month in two years that has negative price inflation.
So why did the market tank? Why is gas still over $4.00 a gallon? What financial institution is next?
The answer: Fear. Uncertainty.
As people, we despise fear and uncertainty. We want to feel safe and secure. Today, are you sure that the money you put into the bank is safe and secure? Well, all deposits up to $100,000 are safe and secure but over that amount, fear and uncertainty.
Since financial markets aren’t part of the beauty business as we know it, it’s easy to dismiss the news. Most of us don’t even know who Lehman, Bear, Freddie and Frannie are. But here’s the reason you need to be aware: History repeats itself. Remember the dot-com crash? That was only 8 years ago and it did effect most people. We could be headed to something worse. I don’t know.
But at the end of the day, how much is $600 Billion? Below is the approximate sales for select companies:
- Wal-Mart: $400 Billion
- Proctor & Gamble: $70 Billion
- Target: $60 Billion
- Kroger: $30 Billion
- L’Oreal: $25 Billion
The entire annual sales for all of the above companies plus $15 Billion left over for dessert is what you could have bought with yesterday’s loss.
Do you think the economy is going to get better or worse in the next 12 months? And do you think the stock market affects the beauty industry?
Happy Tuesday!
September 16th, 2008 at 9:12 am
I think the economy is only going to get worse over the next 12 months and we’re all in for a rough time over the next year or two. Frankly, I’m scared when I see companies like Lehman and Merrill Lynch going under. The writing is on the wall for AIG being next in line although their insurance division is apparently strong and will probably be sold off.
The stock market has a worldwide ripple affect and the beauty industry is absolutely going to be affected. Many of us consider professional beauty treatments discretionary spending. The necessities such as food, gas, heating are consuming more and more of our budgets leaving less for discretionary spending. There is a lot of competition out there for our shrinking discretionary funds and the beauty industry is going to have to work smarter to entice people to spend those funds on beauty services.
September 16th, 2008 at 9:27 am
I actually think that after the begining of the new year, things might start to turn around. You mention Fear being a cause, well, when we elect a new president here shortly, I believe that fear will turn into hope, and with hope we will get more positive attitudes. And i for one would rather have more positive attitudes than fear in our country. Hopefully from there everything will snowball into something bigger and better for our country. And yes the beauty industry will definately be affected in all this. (at least this is what i think
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September 16th, 2008 at 9:43 am
I have a feeling it is going to get much, much worse!
September 16th, 2008 at 9:52 am
It seems to me that it’s only going to get worse over the next year, before turning around. But that’s okay. Economics goes through cycles just like any other sytem in nature, and slow times are nothing new or unfamiliar to us. There’s business and passion in any economy, and no one is more passionate than Beauty Experts.
Personally, I’ve been budgeting tightly all year, so when Christmas spending time comes around, I think I’m going to want to go all out for my friends and family, and really enjoy the shopping experience that I’ve been limiting for myself. I bet a lot of people feel the same way. In my stores, people have already been asking about the holiday items and deals that are starting to come in. We might be pleasantly surprised by holiday sales this year!
September 16th, 2008 at 10:50 am
I think things will get much worse within the next 12 months. With all these huge financial institutions going under, we should all be more educated and money-savvy. AIG and Dell are most likely next to take a fall, and who knows what companies will follow? These are uncertain times for us all…
September 16th, 2008 at 11:55 am
Stock Market Crash, The Sky is Falling, Global Warming/Chilling, Dire Straights, The Martians/Russians have landed, End if the World, Doomsday… these things don’t fit much into my focus, thinking or vocabulary. (Positivity is my #2 strength) Business is Booming, The Sky’s the Limit, Things are Looking Up, It’s a Wonderful Life, and I Feel Terrific! are so much better! I don’t fear the future, but have faith that everything will be great!… did you see the Roberto Benigni movie – Vita è bella, La (Life is Beautiful)? Sometimes attidude is everything.
September 16th, 2008 at 1:28 pm
Finances, fear and uncertainty……And yet Las Vegas remains one of the top vacation spots in the world.
September 16th, 2008 at 3:01 pm
I think it’s going to get alot worse. All industries are being affected.
It seems there’s only one place that doesn’t get affected, “The One and Only”
September 16th, 2008 at 4:58 pm
It is very easy to say “Business is Booming, Sky’s The Limit”, and “I feel terrific” when you are employed, don’t have mouths to feed, and are basically unaffected by crises in the world. But not everyone is doing so well. I am all for optimism and having a positive outlook on things, but it’s kinda hard to be happy-go-lucky when you’ve been laid off from your job, your house is being foreclosed on and you have a family to support.
Having a positive attitude is one thing, but pretending as if you don’t have problems is quite another.
September 17th, 2008 at 6:06 am
what’s 600 billion amongst friends?
September 17th, 2008 at 10:17 am
I didn’t read anywhere that Wendy said she was pretending she didn’t have any problems. Insinuating someone said something is a problem, having a positive attutiude it a blessing, even in times of crises. We have learned here to fill others buckets… do you think your repsonse filled Wendy’s bucket after she read it?
On another note, other countries throughout the world have dealt with much worse than funding issues so you might want to look up a little bit of world history and see what is happening outside the US, you might then have a little more happy-go-lucky attitude.
Thanks Wendy for always having a smile on your face.
September 17th, 2008 at 10:30 am
A smile is the only way to get through some days. But, more important, if you help others – lift them up – it also lifts you up! Fill someone else’s bucket and yours is also filled. Empty someone else’s and it also empties yours. Survivors know how to face life’s challenges with faith that things will work out – what ever doesn’t kill you makes you stronger in the world’s eyes? but my strength is in the Lord Jesus Christ. With Him I can get through ANYTHING. I have overcome being tortured and abused as a child by a mentally ill mother; as an adult – not having a job or food and 4 mouths to feed, forclosing of my home, etc, etc… but God has done many miracles for me and I continue to trust Him and have joy in my heart everyday! Please be assured that I pray for others whom are suffering – especially for you Amber – God can do miracles – you only have to believe!
September 17th, 2008 at 11:12 am
Hey now, ladies put down your swords… everyone is suffering whether you do it with an optomistic smile or with realistic heartache… lets not put anyone down for how they trudge through these times and please leave your religion out of this public blog, let’s be professional. Enjoy this day and all it brings. And be nice to others. It’s just a blog.
September 17th, 2008 at 11:20 am
Why the “Anonymous” blogging? It is the same as talking behind someones back… if you can’t say it to their face or in this case take credit for what you say… maybe it is better off left unsaid. Own up to your comments… if you have an opinion that you want heard, why can’t you put your name behind it?
September 19th, 2008 at 8:27 am
First of all – thank you Sarah! Secondly – to the anonymous poster, not once did I ever say that Wendy was pretending anything. I was simply stating my opinion and defending my first post to which Wendy obviously was responding to. Also, I live in the United States, and I can only comment on what I see going on around me in my home country. So your remark about world history was unnecessary. And don’t try and give me any lessons in “bucket filling” as I practice this on a daily basis. Try posting under your name next time…Thanks!
To Wendy – Thank you for praying for me…the more the better! However, in no way am I suffering at all. I was simply commenting on the crises of the world, not in my own life. While it is inappropriate to discuss religion in the workplace, I will say that I too believe in my Lord and Savior and His miracles and I am glad that you do too. If I offended you, I apologize – like I said before I was simply responding to your response to my initial post. Everyone is entitled to their own opinion, but I do not appreciate being attacked by you or your anonymous friend. Hopefully we can leave this behind.
I wish you both the best day, and I will pray for you as well!
September 21st, 2008 at 8:30 am
Things will get worse if we don’t make HUGE changes. And as we can clearly see the human race is mostly naive and self destructive, I don’t even see it as fear or uncertainty, I see it as live in a bubble syndrome. Which of course is fear, but its all greed and selfishness.
I don’t see that things will turn around till we are at rock bottom. Is this negative? No, its truth. Take off the rose colored glasses and take a look around you. You can say have a positive outlook all you want but that doesn’t change what’s coming to your door. I am sorry, but your Vita è bella attitude is fine only if you want to ignore the suffering of others. Go to Africa and sing your sky is falling song there. Closing your eyes to the suffering in the world is what guarantees there won’t be a change until its to late. You want to pretend everything is OK and look the other way.
Things will not get better. Experts really can’t guarantee this. People are put in place to make us feel better about things so we won’t panic and do something stupider to even further the issue. New flash when people get scared and start “saving” or putting their money away and not spending it YOU ADD THE THE PROBLEM!! Money being spent is what stimulates the economy.
September 22nd, 2008 at 10:01 am
Reality-That which exists objectively and in fact.
These are the facts! EVERYONE is suffering in one way or another. Whether it is a business, in your own personal household, or a friend or family member.
Be thankful, but at the same time, do not be blinded with what is going on around you.