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September 11, 2001

Forbes Says Cash Is Being Hoarded

According to Steve Forbes, Editor-in-Chief of Forbes magazine, we're into a global slowdown--the first since the 1970's. And, he contends, Greenspan and the Federal Reserve actions, taken deliberately, have caused today's malaise.

Forbes says that Greenspan was convinced our economy was too prosperous and had to be slowed down. Now, Forbes suggests, he doesn't know how to restart it.

What's worse, "the Fed's mistake has had global implications, as scores of countries are tied to the dollar. Seventy percent of the dollars printed end up being used as transaction money overseas."

Furthermore, he cautions, "cash is increasingly being hoarded, precisely because there is a growing shortage of it."

Barter companies across the country are reporting an increase in business, as the small business sector mirrors what Forbes contends.


Asians Extremely Pessimistic About The Global Economy

According to a recent story in CFO magazine, chief financial officers everywhere are down on the economy. But the area of the world where the pessimism is the worst is Asia.

The survey polled finance executives in the U.S., Europe, and Asia about regional and global issues. There was a 59 percent decline in global confidence among all respondents compared with last quarter's attitudes about the near term.

An especially glum response from Asia's CFOs weighed heavily on the collective confidence. A staggering 86 percent of the Asian executives say they are either concerned or very pessimistic about the global economy during the next year.

Looking to the future the mood changes. Overall, 72 percent of the CFOs are confident or very optimistic about the global economy during the next five years.


Price Compression Looms For Hoteliers

According to lodging industry veteran Michael Leven, new hotels (high fixed-cost business) are creating what he calls "price compression," when they lower prices to grab the existing business in the marketplace...so as to make their mortgage payments.

Leven also said that renegotiation of rates with heavy customers happens in down economic times. It's a fact of life which means accepting a smaller level of profitability, rather than no profitability.

But he claims it's a two way street, "we'll renegotiate the rate in return for assurance that when things are good, I can go back to my normal condition."


Media Ownership Changes Ahead?

The possibility of changing or eliminating long-standing media ownership rules will have a dramatic effect on the TV and radio industry as consolidation efforts would quickly ensue.

A three-judge panel of the U.S. Court of Appeals has indicted that the FCC (Federal Communications Commission) will reconsider its broadcast-ownership rules. Some experts expect the FCC, under the new administration, to relax the rules.

Networks today are limited to owning stations that cover no more than 35% of the national audience. In a future issue of BarterNews we'll take a look at the implications of media consolidation...the pros and cons as it affects the barter industry.


Here And There. . .
  • Marriott International, one of the world's biggest hotel chains, told its investors that business in August was even bleaker than in July... and was the worst year-over-year comparison the hotel company has ever experienced. They also reported that they're seeing the worst level of Christmas leisure bookings in the past ten years.

  • A small announcement coming out of the Department of Defense, regarding awarding $5 billion to five U.S. companies for the destruction of nuclear and other weapons in the former Soviet Union, is good news for a more peaceful world. It's expected the work will be completed by September, 2006.

  • The Mercatus Center of George Mason University says government regulation in the U.S. is costing the business community $91 billion a year just for complying with 25 major statutes. Occupational safety and health regulations cost the most--an estimated $48.6 billion a year, followed by employee-benefit regulations at $18.4 billion.

  • The Federal Trade Commission lists vacation prize promotions as one of the dozen most popular e-mail scams. Electronic certificates congratulate you on winning a fabulous vacation for an attractive price...some even say you have been "specially selected." Note: Often, the cruise ship you're booked on looks more like a tugboat.
  • Wine.com's coming auction, slated for September 15 & 16, will see one million bottles of wine moved at less than the $10 million cost, because there's already a lot of inventory on the market and another big grape harvest is underway.

    It's the finish to an ambitious attempt by Wine.com to corner the online wine market, which went through $200 million before selling its name, web site, and mailing list to much smaller competitor EVineyards.com for $10 million in April.

    Consumers can bid along with wine retailers and restaurants, with the maximum purchase by consumers being 20 cases. More information available at www.auctionet.com.

  • Dude ranches have taken a real hit this year. The nation's 350 to 400 dude ranches are down 15% overall, and some ranch owners are offering discounts of 25% to entice tourists to hop a plane or a train heading out West.

  • Travelers will be flocking to the Caribbean this winter as prices are being lowered due to a glut of hotel rooms and berths on cruise ships. The number of cruise ship berths is now 5.1 million, up some 28% from four million a year ago. Smith Travel Research says rooms in hotels have grown by 127,000 rooms since 1995. (A growing amount of inventory is available in the barter marketplace.)

 

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Copyright BarterNews 2003. Redistribution of BarterNews content expressly prohibited without the prior written permission of BarterNews.