New York Economy still in the Doldrums
Real Gross Domestic Product. The Consumer Price Index. The “Beige Book.” The Jobs Loss Report.” The Survey of Consumer Sentiment. Productivity and Related Data. Corporate Profits. New Construction. The reality is that there are dozens of economic indicators that are supposed to tell us how the U.S. economy is faring.
I have always trusted a far less scientific source to tell me what is really going on behind all of the noise and dueling economic indicators. That source: taxi and sedan drivers. These are the people that can tell you if business is getting better or worse, or just stagnating in a bad place.
This week I was in New York, and the economic picture would have been far murkier if one did not know what was taking place that day. Traffic in Manhattan was the worst I have seen it in a very long time. But that wasn’t because business is starting to boom again; the gridlock that existed from the East Village to the Upper East Side to Queens Boulevard was brought on by the events at the United Nations. I happened to be in New York on Wednesday (September 23rd), the very same day that President Obama addressed the United Nations, which was enough to wreak havoc on the traffic situation all across the tri-state area.
But what about the economy? According to the oracles I spoke with—taxi and sedan drivers—business has not picked up at all. This came as a real surprise. After all, the stock market is up over 50% from its March lows—quite a bounce-back. But it has been said that the financial markets are a leading economic indicator, often predicting what the economy will do six to eight months down the line. So perhaps we are looking at a turnaround that is just around the corner. Or, what may be more realistic, is the jobless recovery that some of the most pessimistic economists have predicted. I am a half full kind of guy, but a jobless recovery seems quite possible, if not probable. Some companies have layed off so many thousands (GM) that they are learning to do more with less. Other firms, particularly financial companies, have disappeared altogether (Bear Stearns, Lehman Brothers, etc.). We know those jobs are not coming back.
So there is nothing to do but wait. Well, that’s not quite right. Sometimes waiting is the worst thing one can do. I didn’t wait. I left corporate America, started my own business and I thank my lucky stars that I did. Business is brisk. The moral of the story: listen to pundits less and if you happen to be unemployed or “under-employed,” consider your alternatives. After almost three decades I learned that not only is there life after corporate America, but there could be a very good life. But only if one has the courage to step back and take a substantial risk. You can’t do this on a whim – you have to have a plan. However, with the right strategy, who knows how far you can go? You may be able to make liars out of those taxi drivers after all.