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nucinud
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This is an article from the New York Times:

Recession Diet Just One Way to Tighten Belt

By Michael BARBARO and ERIC DASH
Published: April 27, 2008
Stung by rising gasoline and food prices, Americans are finding creative ways to cut costs on routine items like groceries and clothing, forcing retailers, restaurants and manufacturers to decode the tastes of a suddenly thrifty public.

Zachary P. Stephens for The New York Times
George Goulet, in his home office in New Hampshire, stays at Hampton Inn rather than the Hilton when he travels.
Multimedia
GraphicBuying Less of Almost Everything
Related
Times Topics: United States Economy

Spending data and interviews around the country show that middle- and working-class consumers are starting to switch from name brands to cheaper alternatives, to eat in instead of dining out and to fly at unusual hours to shave dollars off airfares.

Though seemingly small, the daily trade-offs they are making — more pasta and less red meat, more video rentals and fewer movie tickets — amount to an important shift in consumer behavior.

In Ohio, Holly Levitsky is replacing the Lucky Charms cereal in her kitchen with Millville Marshmallows and Stars, a less expensive store brand. In New Hampshire, George Goulet is no longer booking hotel rooms at the Hilton, favoring the lower-cost Hampton Inn. And in Michigan, Jennifer Olden is buying Gain laundry detergent instead of the full-price Tide.

Behind the belt-tightening — and brand-swapping — is the collision of several economic forces that are pinching people’s budgets or, at least, leaving them in little mood to splurge.

The price of household necessities has surged, with milk topping $4 a gallon in many stores and regular gasoline closing in on $3.60 a gallon nationwide.

Home prices are sliding, wages are stagnant, job losses are growing and the Standard & Poor’s 500-stock index, a broad measure of stock performance, is down 6 percent in the last year. So consumers are going on a recession diet.

Burt Flickinger, a longtime retail consultant, said the last time he saw such significant changes in consumer buying patterns was the late 1970s, when runaway inflation prompted Americans to “switch from red meat to pork to poultry to pasta — then to peanut butter and jelly.”

“It hasn’t gotten to human food mixed with pet food yet,” he said, “but it is certainly headed in that direction.”

Retail sales figures and consumer surveys confirm that Americans are strategically cutting corners, whether it is at the coffee house or the airport. (In: brewing coffee at home and flying coach. Out: Starbucks and first class.)

In March, Americans spent less on women’s clothing (down 4.9 percent), furniture (3.1 percent), luxury goods (1.3 percent) and airline tickets (1.1 percent) compared with a year ago, according to MasterCard SpendingPulse, a service of the credit card company that measures spending on 300 million of its cards and estimates purchases with other cards, cash and checks.

Wal-Mart Stores reports stronger-than-usual sales of peanut butter and spaghetti, while restaurants like Domino’s Pizza and Ruby Tuesday have suffered a falloff in orders, suggesting that many Americans are sticking to low-cost home-cooked meals.

Over the last year, purchases of brand name cookies and crackers have fallen, according to Information Resources, which tracks retail sales.

Sales of Nabisco graham crackers have dropped 7.5 percent, and Keebler Fudge Shoppe cookies have slipped by 12.3 percent. Not even beer is immune. Sales of inexpensive domestic beers, like Keystone Light, are up; sales of higher-price imports, like Corona Extra, are down, the firm said.

Some are skipping drinks altogether. The number of people ordering an alcoholic drink fell to 31 percent last month from 42 percent last summer, according to a survey of 2,500 people conducted by Technomic, a restaurant industry consulting firm.

“People have started to shift spending as if we were in a recession,” said Michael McNamara, vice president for research and analysis at MasterCard.

Such trade-offs were on vivid display last week in Ohio, where layoffs have been rampant. At Save-A-Lot, a discount grocery store in Cleveland, Teresa Rutherford, 51, chided her sister-in-law, Donna Dunaway, 44, for picking up a package of Sara Lee honey ham (eight ounces for $2.49).

“We can’t afford that!” she said. “Get the cheap stuff.” They settled on a 16-ounce package of Deli Pleasures ham for $3.29, or 34 percent less an ounce.

The women said that soaring prices for food and fuel had changed what they buy and where they buy it. “We used to eat out at Bob Evans or Denny’s once a month,” said Ms. Rutherford, who works in an auto-parts factory. “Now we don’t go out at all. We eat in all the time.”

Ms. Dunaway, a homemaker, used to splurge on the ingredients for homemade lasagna, her husband’s favorite, before food prices began to surge this year.

“Now he’s lucky to get a 99-cent lasagna TV dinner, or maybe some Manwich out of a can,” she said. “I just can’t afford to be buying all that good meat and cheese like I used to.”

By no means has the economic downturn been bad for all product categories. For instance, sales of big-ticket electronics, like $1,000 flat-panel televisions and $300 video game systems, are on the rise, according to retailers and research firms.

Falling prices for such devices and a looming government deadline to convert to digital television have helped. So has the view, sensible or not, that the technology is a good investment. At a Best Buy in Southfield, Mich., James Szekely, 28, a mechanical engineer, was shopping for a big high-definition TV that he expected would cost at least $2,000, an expense he rationalized because “at least we can watch movies at home.”

(In a survey conducted this month by the NPD Group, a research firm, consumers suggested that they would sooner cut spending on clothing, furniture and eating out than on video games.)

At Home Depot, sinks and faucets are selling briskly. Managers at the chain suspect that consumers, loath to spend money on a splashy kitchen renovation or new roof, are settling for a cheaper bathroom “refresh.”

Another top seller at home improvement stores: programmable thermostats and insulation, which can cut fuel bills.

Many retailers are struggling to adjust to the new needs. Clothing sales have started to sink at department stores like Macy’s, Kohl’s and J. C. Penney. So have furniture sales at companies like Bombay and Domain, both of which have filed for bankruptcy protection.

Consumers are spurning small indulgences. Starbucks is warning of a drop-off in purchases, and sales have dipped at higher-end restaurant chains, including the steakhouses Ruth’s Chris and Morton’s.

To drum up business, Domino’s is offering a new deal: three 10-inch pizzas for $4 each. “We are not recession-proof,” said the chain’s president, J. Patrick Doyle.

But chains that emphasize low prices, like TJ Maxx and Wal-Mart, are thriving. And cut-rate supermarkets, like Save-A-Lot, are swamped.

“People are not not spending, but they are changing how they spend,” said Marshal Cohen, chief analyst at the NPD Group.

And they are often willing to sacrifice convenience or swallow their pride.

George Goulet, 52, the business traveler switching from the Hilton to the Hampton Inn, now books flights that depart in the afternoon rather than the early morning. “It’s a lot cheaper,” he said. “I can really see the difference.”

Mary Gregory, 55, a telephone company operator in Cleveland, used to eat red meat at least once a week. Now it is hardly ever on her menu. “I usually buy turkey instead,” she said. “Any recipe that calls for meat, like chili or spaghetti, I try to substitute turkey.”

Carl Hall, a retired construction worker in Detroit, wants to buy a fence for his backyard. But he decided not to buy a finished product at Lowe’s, the home improvement chain where he was shopping recently. With money tight, “I am looking to put it together myself,” he said, adding that he hoped to save $200.

As the compromises mount, people are even coming up with clever schemes to hide their cost-cutting.

Holly Levitsky, a 56-year-old supermarket cashier in Cleveland, buys a brand of steak sauce called Briargate for 85 cents and surreptitiously pours it into an A1 steak sauce bottle she keeps at home.

“My husband can’t even tell the difference,” she said.

Mary M. Chapman, Brenda Goodman and Christopher Maag contributed reporting.
"We are what we pretend to be" Kurt Vonnegut, jr.



Now U C It Now U Don't

Harry Mandel

www.mandelmagic.com
jlevey
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"...Holly Levitsky, a 56-year-old supermarket cashier in Cleveland, buys a brand of steak sauce called Briargate for 85 cents and surreptitiously pours it into an A1 steak sauce bottle she keeps at home.

“My husband can’t even tell the difference,” she said..."

She should thank her Lucky Charms!... I mean (according to the article) ...She should thank her "Millville Marshmallows and Stars".

Thanks for this detailed article Doug. The fact that milk, and gas are significantly more expensive her ein Canada than the US, doesn't make this news any sweeter. Think I'll cut back on the Starbucks!... I mean Tim Hortons! (lol) Or start drinking gas, since it is cheaper (for the time being ) than Milk! lol
Jonathan
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jay leslie
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I agree but I also think that people have decided not to travel. This is the germ of a trend. I am predicting more house parties for adults. Since I am not an economist, I can't say when this will happen but I do believe when people stay close to home they will be entertaining more. I am contemplating starting to advertise that "House Parties are IN"
SpellbinderEntertainment
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Yes, I think a Recession is here. Not coming but here.
If milk, bread, and toilet tissue are economic indicators we’re in trouble.
When a vast corporation like Bear Stearns can evaporate overnight we’re in trouble.

That said, the people who have money to burn, will have money to burn.
I’m not that worried about people cutting back on entertainment,
in fact during depressions and recessions entertainment becomes key.

So keep an eye out, be practical, but don’t drop your rates in panic,
and don’t worry, if there is quality to be had, people will buy.

Unlike cereal and steak sauce, people do not want generic magic,
they want something worth their investment!

My thoughts,
Walt
magicofCurtis
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On the news today. The rich is still spending. Designer clothing stores are doing better than ever. IN NYC condos sales of 10 million and above are up 89 sold this year already and last year only 17....

I was at dinner the other night at a nice restaurant and the place was packed and I still get my sunday cupcakes for $2.95 each from the local yummy bakery and the line was out the door. People are still spending just the weak consumer has stopped spending a bit.

Yes things do cost more, my grandmother still recalls bread being 10 cents a loaf, but guess what? She still buys things and spends her cash after 50 plus years of complaining about bread and gas prices! We are going through a global change become use to it. The weak will fall the strong will become stronger and maybe RICH.
todsky
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Quote:
On 2008-04-27 20:25, jlevey wrote:

She should thank her Lucky Charms!... I mean...She should thank her "Millville Marshmallows and Stars".


That's a good one!

Due to the recession, in addition to stealing the used coffee grounds from the Tim Horton's dumpster, I am offering clients a 2-for-1 magic deal: I repeat every trick twice, so they get twice the magic for the same price! I'll let you all know how this goes...
Todsky's Magic Shop: over 15,000 tricks, books, DVD s and Card decks. www.magicstore.ca
wizardofsorts
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The article mentions a woman that used to eat out "once a month at Denny's." I'm sorry but these folks should not be your target market. If your target market think a once a month trip to Denny's is a luxury then you will be hurt by this down turn. If you target a market with more disposable income then you won't be as effected.

Edd
Edd Fairman, Wizard of Sorts is a corporate magician available for your next trade show, hospitality suite, client luncheon, or company event. http://www.wizardofsorts.com
Al Angello
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Thank God my business is up. It appears that my clients would rather hire me than eat.
Al Angello The Comic Juggler/Magician
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"Footprints on your ceiling are almost gone"
magicofCurtis
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Al why do you project off negative thought often?
Doc Dixon
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Quote:
On 2008-04-30 09:01, Al Angello wrote:
It appears that my clients would rather hire me than eat.


I believe you have just created the best slogan ever.

Do the cups and balls with fruit loads and you'll have everything covered.

DD
TheDean
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Hehehehe... funny stuff guys!

Hey as I've always said about all this; "You Get What You Focus On and Are Willing to Go For!" Thrive or writhe, it is all about our attitude and then our ACTION.

Belief & Behaviour... Can? Can't? It's up to YOU! The direct answer is: “If You Insist!”

Hey, there are am many good news agents as there are bad news agents... why focus on and follow the poor-me's of the world?

Gotta go now again...
Deano (doin’ just fine and then some) in Reno
<><
Dean Hankey, *M.D. - The Dean of Success Solutions!
Serving & Supporting YOU and Your Success!
"Book More Shows... Make More Money... SERVE MORE PEOPLE! - Not Necessarily In That Order…"

(*Marketing Doctor) Smile
Al Angello
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Doc Dixson
Have we met? I like a man with a sence of humor during tough times. Remember "when the going gets tough the tough get going" yada yada yada

Curtis
You have been doing shooters with Paris Hilton too long, not everyone in America is driving a Ferrari my friend. Why don't you step out of Bel Air and smell the coffee.
Al Angello The Comic Juggler/Magician
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"Footprints on your ceiling are almost gone"
jay leslie
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Often times I tell the host that people forget the food and remember the entertainment. I ask them to remember the last meal they had when they went to a stage play... they usually can't. Then I ask them what the play was about...They get the point. So Al is correct, we should all be so good that people make us the feature as opposed to some buffet that will be forgotten in a week.
magicofCurtis
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Al,

I must disagree with you. A dear friend of mine she does the birthday party market - family market shows in the Midwest and she is busy doing about 5 to 8 shows a week including daycar and school programs. Her fees are not on the low end and not on the high end just right for her. I have known her for over ten years and she has always been busy. She does well at what she does and she stays consistent in the family mags, mailings and referrals.

I think it is our attitude and how we position ourselves in our market.

Jay,
Great way of putting it. Smile

P.S.

I have updated my website feel free to check it out... the media section has photos and video...
Al Angello
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OK
I will be totally honest. For the past two weeks my phone has been ringing, so now my bookings are equal to last years bookings, but they sure were slow getting started this year.

Curtis
Did you ever do a show in the Hollywood hills on one of those cliffs.
Al Angello The Comic Juggler/Magician
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"Footprints on your ceiling are almost gone"
magicofCurtis
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Al, business does go through a slow time but it should pick right back up...
OF course I have done shows in the hills they are the biggest paying private clients usually since they love to throw big bashes! Smile I left before the mud slides....
Al Angello
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Some of those houses only have the front door touching ground, and everything else is on stilts.
spooky
Al Angello The Comic Juggler/Magician
http://www.juggleral.com
http://home.comcast.net/~juggleral/
"Footprints on your ceiling are almost gone"
jay leslie
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Al, I go there sometimes and just beg to stay. I always have my camera because I think I can sell footage of as house as it slides down the hill. But in reality there are very few on stilts, you're thinking of Malibu by the sea where every time the surf is high you get soaked.
Al Angello
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Jay
Perhaps my mind was playing tricks on me, but the most vivid memory I have of La La land was those cliff dwellers in the hills.
Al Angello The Comic Juggler/Magician
http://www.juggleral.com
http://home.comcast.net/~juggleral/
"Footprints on your ceiling are almost gone"
jay leslie
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Those are Hobbits.

The ones on flat land are Ewoks.

It's amazing how they get along.
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