Gaga Versus A Glut of Goods

Yes, I know that I'm more than a little obsessed

But really, it's not what you think
Lady Gaga holds no fascination for me
but Economics does

Linked by Instapundit, the Lady Gaga Economy

The Lady Gaga phenomenon conquered the Today Show this morning, with what must have been the largest crowd they’ve had in their summer concert series.
In the convoluted way things occur to me, I thought of the contrast between our limping general economy, and her thriving fame-monster micro-economy.

Say’s Law in economics is the proposition that supply creates its own demand. A relative overproduction of certain goods may occur, implying that too many scarce inputs have gone into the production of unwanted items relative to inputs for desired goods. But general overproduction — to which demand stimulus would allegedly provide relief — is not the core economic problem.


Right now, there’s lots of demand for Lady Gaga, say; but maybe too many houses, cars for sale, and hokey Internet startups.

So let me see if I get this right, what he's really saying is that we need more Gaga and less goods.
That just can't be good

Happy Friday everyone
And to my blogger friends who've been sweltering in the heat wave from Canada to France, I wish you cool breezes and plenty of ice for your drinks this weekend.

How To Handle the Recession - Riga Style

Global rebound anemic: Roubini
SAO PAULO (Reuters) - Advanced economies face years of anemic growth and the risk of a double-dip recession as their citizens cope with sluggish employment and highly indebted governments, economist Nouriel Roubini said on Monday.
A sovereign debt crisis in the euro zone has rattled financial markets in recent weeks as investors worry that fiscal austerity measures dictated by a $1 trillion European Union-International Monetary Fund rescue plan could stifle already hobbled global growth.

So what can you do when the news is bad and it is just so ugly out there...well in true European fashion you can always take to the streets as these luscious Latvian blonde barbies did.
Latvia blondes hold festival to beat recession blues

Hundreds of blonde Latvian women have been marching through the capital Riga to try to bolster the national spirit in time of recession.
Most of the participants dressed in pink and wore high heels.
The blonde parade began last year and was planned as a one-off but it is back by popular demand and is now a two-day festival.
Latvia has been hit badly by recession. Its economy shrank by 18% in 2009 and it has Europe's highest unemployment.

Yeah, those blonde babes really know how to rip it up in Riga!

Marika Gederte, president of the Latvian Association of Blondes, told the BBC the idea came out of the economic gloom.
"I was so tired, you know, every day opening the computer and reading the newspapers and just reading about problems. We decided... let's do something nice. And I asked myself the question: what can I do for my country? And this is what I did... We are very proud to be blonde."

Proud to be blonde? She's got to be kidding.
Obviously she has having a 'blonde moment" when she said that.
No wonder we have so many blonde jokes.

On a plane flight from Seattle to Chicago, a blonde was sitting in economy class. About half way through the flight, she got up and moved to an empty seat in first class. A flight attendant who observed this, went over to her and politely explained that she had to move back to economy class because that was what her ticket was for. The blonde replied, "I'm blonde, I'm beautiful, I'm going to Chicago and I'm staying right here."

After several attempts to explain to the blonde why she had to return to economy class, the flight attendant gave up. She went to the cockpit and explained the situation to the pilot and co-pilot. The co-pilot said, "Let me try." He went up to the blonde and politely tried to explain to her why she needed to return to her seat in economy class.

But the blonde only replied, "I'm blonde, I'm beautiful, I'm going to Chicago and I'm staying right here." Frustrated, the co-pilot returned to the cockpit. He suggested that perhaps they should have the airline call the police and have her arrested when they land.

"Wait a minute," said the pilot. "Did you say she's blonde? I can handle this. My wife is a blonde. I speak Blonde." So he went up to the woman sitting in first class and whispered something in her ear.
"I'm sorry," said the blonde, and she promptly got up and returned to her seat in economy class.

"What did you say to her?" ask the astonished flight attendant and co-pilot.
To which the pilot replied, "I just told her that first class isn't going to Chicago."

Happy Monday

Lusting After Lower Heels

From the Wall Street Journal

Stilettos—So Two Years Ago
The return of the 'kitten' coincides with shaky economic times

so do serious times call for serious shoes?

That leads some to speculate whether there's a relationship between a sinking heel and the stock market. Gary Loveman, CEO of Harrah's Entertainment Inc., was reported saying earlier this year that he likes seeing women wearing stilettos in his casinos because he believes it means guests are more likely to spend more.

on the other hand

But not everyone thinks the kitten heel means bad times. Shorter shoes might be "an indication of the recession we've just been through," suggests Jeffrey Hirsch, editor of the Stock Trader's Almanac, adding that such correlations have "not so much" validity anymore.

Good market, bad market, I don't care. But enough already with the 6 inch stilettos.

Retail Therapy

This is for La Belette Rouge...
Maybe it's time to trade in Igor for Kelly

From Reuters

Crisis pushes men to therapy, women to handbags

"Women are also worried about their jobs, but not to the extent that they feel their mere existence is being threatened and so they are in the mood to buy despite the crisis," Jaffe said.
Some men have stopped themselves from splurging on flashy goods that could be deemed as tasteless during times of austerity, while others don't have the capacity to think about spending on luxury items, Jaffe said.
"Many male managers are suffering from a huge loss of status, many feel under an enormous amount of pressure or are suffering from burnout. They just don't have the resources to think about buying luxury goods and prefer to go to a life coach," she said.

LVMH and Hermes defensive stocks....who knew?

LVMH Lowering Prices To Make Money - What A Concept

From New York Magazine

LVMH Finds Ways to Make Money: Lower-Priced Givenchy Clothes!

LVMH isn't doing terribly in the downturn. Net profits for the first half of the year fell 23 percent, which sounds horrible, but competitor PPR just announced that its profits fell 76 percent, which is far more embarrassing (even if the decline was mostly owing to sales of YSL's Beauté division last year). But while LVMH's sales increased 0.2 percent, PPR's sales slipped 3.6 percent. Perhaps LVMH is winning because they're adapting better to These Times. They're slowly broadening their customer base for apparel, to include not only the very wealthy, but just the wealthy folks, too. And so Givenchy is launching a new capsule collection called Redux, designed by Riccardo Tisci. Already the marketing is genius: The name alone says, "Are you a middle-income consumer? You can probably afford me on sale!"

Prices start at around $340, which is still cheaper than Alexander Wang's biker shorts. The line is based on Givenchy classics like the white shirt and leather jacket. Tisci will show Redux twice a year alongside the pre-collection. The line will be available in October and will include shoes. So the downturn is paying off for the aspirational consumer. It's probably only a matter of time before more lines like this emerge. Funny how when the economy makes a luxury company its bitch, they find out who their real friends are: the poor.

(LMAO at this remark)

Except Louis Vuitton's customers. Those people are unstoppable.

Givenchy Fall 2009 RTW

Personally, I'm wondering if they are looking to cut costs by offering dresses with only one sleeve.

Jewelry Business - The Bankruptcies Begin

A month of mayhem in the jewelry market.
First the bankruptcy of Michael Beaudry
Then two days ago Henry Dunay

From IDEX

Henry Dunay Designs files for Chapter 11
(June 24, '09, 8:31 Courtesy National Jeweler Network)
Henry Dunay Designs Inc. has filed for Chapter 11 bankruptcy protection, the second high-profile jewelry design company to do so in recent weeks.

In a voluntary petition form filed at the U.S. Bankruptcy Court of the Southern District of New York in Manhattan, the corporation estimated that it has between 100 and 199 creditors. Its assets total between $1 million and $10 million, and its liabilities total between $1 million and $10 million.

The paperwork was signed by the company's attorney and by its president, Henry Dunay, on June 18.

According to the company's Web site, Dunay launched his company in 1965 and has won more than 50 awards in his five decades in the jewelry industry. Robb Report magazine named Dunay "World's Best Jewelry Designer" in 2000 and 2001.

In addition to having his designs line the showcases of high-end stores such as Bergdorf Goodman, Dunay's clientele includes Tom Cruise, Oprah Winfrey and Secretary of State Hillary Clinton, among many others.
Earlier this month, Michael Beaudry Inc., based in Los Angeles and also known as a jeweler to the stars, filed for Chapter 11 bankruptcy protection.

Then yesterday David Webb

From Diamond World

David Webb Inc. files for Chapter 11
The company’s gross revenues were less than$5 million
By: Diamond World News Service

David Webb Inc. has filed for Chapter 11 bankruptcy protection at the U.S. Bankruptcy Court for the Southern District of New York in Manhattan. Its lowered sales have not been able to absorb the high operational costs, or pay off its debts and expenses, owing to the market slowdown. In the fiscal year that ended June 30, 2009, gross revenues from sales amounted to less than $5 million, as compared to gross revenues worth $13.25 million in the previous fiscal.

On June 18, a Board decision was taken to file for Chapter 11. The filing notes 50-99 creditors, assets valued between $10 million to $50 million, and liabilities worth $1 million to $10 million. The 61-year-old family-owned retail and manufacturing jewellery company has stores in Manhattan and Beverly Hills, Calif.

Now the question is

who's next

Fashion Biz - Prada in Peril?

Rem Koolhaas designed Prada Store on Rodeo Drive

Prada May Reorganize Debt to Fund New Stores as Sales Suffer
April 2 (Bloomberg) -- Prada SpA’s owners may ask banks to reorganize 1.2 billion euros ($1.6 billion) of debt, freeing cash to open new stores and promote the luxury label’s brands in the recession, two people with knowledge of the plans said.
Sales at stores open at least a year fell in 2008, reducing Prada’s cash on hand, while earnings declined as fixed costs rose, the people said. The Milan-based company may ask for some debt payment deadlines to be extended, they said, asking not to be identified because the plans are confidential.
Luxury labels are taking different approaches to expansion as a five-year industry boom crumbles, depending on their access to cash. Kelly bag maker Hermes International SCA vows to open or refurbish 20 stores in 2009, while jeweler Bulgari SpA has put new stores on hold and will close some outlets. Sanford C. Bernstein analyst Luca Solca forecasts the industry’s sales will fall as much as 15 percent this year.
“Unlike in previous recessions, luxury brands are contracting, though the biggest names are suffering less,” Moody’s Leschiutta said.

To raise the brand’s profile, Prada is building an exhibition space in Seoul, designed by architect Rem Koolhaas, that can be flipped by cranes to change shape for new events.

I love the store architecture and design by Rem Koolhaas, but is it really necessary for Prada to raise its brand profile? Seriously, who doesn't know about Prada?

Maybe instead of spending so much on the build out of the stores...although I love buildings that can change shape for events...they could lower prices slightly and increase their sales.

Who's Driving What In Washington

I guess that we finally know what's wrong with Detroit

From Politico

With President Barack Obama showing the ailing U.S. auto industry some tough love Monday, POLITICO wondered -- what's ...
... in the driveways of White House aides? A lot of foreign cars, as it turns out. A survey of West Executive Drive, where White House staffers park, revealed only five American cars out of 23 --a Dodge Grand Caravan, two Ford Escapes, a Jeep Cherokee and a Cadillac. The lot was sprinkled with BMWs, Mercedes, Hondas, Toyotas, Saabs, Audis, Volkswagens and a Volvo.

h/t instapundit

Books - Oh The Calamity!

If you haven't already read Wendy B's post on Barbara Tuchman's "A Distant Mirror - The Calamitous 14th Century" you need to read it now.

It's become de rigueur for newspaper columnists, bloggers and people standing around the water cooler to bemoan the decline of civilization as evidenced by what one historian called "economic chaos, social unrest, high prices, profiteering, depraved morals, lack of production, industrial indolence, frenetic gaiety, wild expenditure, luxury, debauchery, social and religious hysteria, greed, avarice, maladministration, decay of manners."

If you're feeling panicky over the state of the world, A Distant Mirror is my prescription for what ails you.

Tuchman, writing in 1978, says, "If our last decade or two of collapsing assumptions has been a period of unusual discomfort, it is reassuring to know that the human species has lived through worse before."

As they say...read the whole thing.

And, what I want to know is where is Wendy's instalaunch?

Financial Crisis - For Fun and Profit!

Look who's having fun in the worldwide financial crisis!
Yup, you guessed it...George Soros.

From The Mail online
'I'm having a very good crisis,' says Soros as hedge fund managers make billions off recession

A hedge fund manager who predicted the global credit crunch has said the financial crisis has been 'stimulating' and the culmination of his life's work.

I love the way Soros will bring down and entire currency or country...if it means he will profit off of it! God knows after you've earned a few billion, you just can't get enough!

The End Of The World - NOT!

Yesterday one of my colleagues stopped by my office and asked if this was the end of the world.
And she was serious.
This was a woman who grew up in a country that was racked by a brutal and bloody civil war. Later in her life she was comfortably settled in a Middle Eastern country that was invaded by a brutal tyrant. She literally had to escape and left her business and friends behind. Fortunately she was able to move to California and start a new life.
Today she has a thriving business with an international clientele of royals whose wealth is diminishing only marginally in the current global slump. Business is brisk.
And she's worried about the end of the world.

Personally, I don't think that it is the end of the world. We live in a consumption crazy country where billions have been spent on gambling, pet perfume, anti depressants, computer gaming, recreational drugs, porn and every tech product imaginable. $200 jeans, $50 mascara, $400 shoes, $2000 handbags, $4 coffees and $15 cocktails....have become the norm in our on demand society and the sense of entitlement is so widespread that we expect everything to be available at all times. This country is so wealthy that even the poor are obese and have plasma TVs with 150 cable channels.
So a correction is in order...and yes this is going to be a big one...and ugly...very ugly.
But the markets will eventually stabilize, housing will become affordable again, gasoline will be reasonable, insane clothing and accessory prices will come down and people will be more thoughtful about their spending. Companies will downsize and then rehire. Innovation in medicine and technology will happen. The earmark addicted - pork spending Senate will be voted out.
It's not the end of the world.

This video of comedian Louis CK on Conan O'Brien's show has been all over the internet. It kinda puts things in perspective. If you haven't seen it take a look.

Everything is Amazing, Nobody is Happy

Bienvenue en France ! La Grève Générale !

Ah Paris
The City of LightThere is always the Paris of our dreams.
Strolling along the Champs-Elysées before stopping at a sidewalk cafe for an apéritif...
Visiting the Musée d'Orsay then perusing the used book vendors along the quai next to the Seine...
Shopping at the boutiques on the Rue Saint-Honoré and the Rue du Bac...
Checking out the antiques at the Marché aux Puces early on a Sunday morning...
Dining late at a neighborhood brasserie in the 16th Arrondissement...

And then there is the Paris of our reality.
La Grève

From AGI News
FRANCE: GENERAL STRIKE, CHAOS IN CENTRE OF PARIS
AGI) - Paris, Jan. 29 - Today's general strike in Paris has turned into chaos and clashes in the French capital. The strike against the economic politics of Nicolas Sarkozy and his management of the financial crisis saw the participation of tens of thousands of people, mostly just parading peacefully. After a few hours however some groups of youngsters became violent. Many of them were wearing ski-masks, they started shouting slogans against Sarkozy asking for his resignation. Then they began throwing stones, they started fires and clashed with the police. The police in turn used truncheon against the rioters but were unable to disperse them according to eye witnesses. The protesters tried to enter Boulevard de Capucines shouting ''We go to the Elysée!". Had they really done so they would have passed the shopping and tourism districts to reach the President's office. The police stopped them however.

From the Wall Street Journal

In France, A Strike Against the Economy

French unions are worried that the faltering economy will lead to massive job cuts. So naturally they organized a general strike yesterday that could cost the economy a few hundred million euros in lost working hours. Nobody has ever accused the union bosses of clear thinking. "Black Thursday" is the first sign of political trouble in a major European economy as a result of the economic crisis. More than one million people protested against President Nicolas Sarkozy's economic management. As always, France's public-sector employees were particularly eager to strike -- 23% of them didn't show up for work.

And from a blog (h/t joe)
Yet again the French are on strike. This time, among the usual collection of everybody striking over their own petty demands that they expect the rest of society to attend to for them, is the over-arching theme of this economy wrecking event – they are striking against the global economy.
The best I can gather from interviewed agonists and such is that in large part people are mad at the French government’s intervention to prop up the banks and major industries, something the blithering idiots are usually all for. Normally, a trend away from socialistic dirigisme would be a good thing for the overall potential of a healthy economy, but these protestors, including the bolshy CGT, Reds, etal., are protesting that the largesse of the state is being directed at the economy at all and not limited to relieving them of the cost of social free-riding.

Even the employees of the Euronext stock exchange are marching. Just what is it that they think the ‘social compact’ is supposed to do for their racket that the rest of the people in their same union won’t protest?

and you wonder

does anyone really want another French Revolution?

well, apparently so...

Never letting a crisis go to waste, the left are ready to exploit your misery for the sake of their power-grab, and opportunity to wreck the economy for good with methods borrowed from the largely agrarian 1930s. As per the Boy wonder Olivier Besancenot:
Olivier Besancenot, the young leader of France’s extreme left is hoping Thursday’s strike will be the first step towards another French revolution as the recession bites and protests multiply across Europe’s second largest economy.“We want the established powers to be blown apart,”

From the International Herald Tribune

Strikes hobble services in France

PARIS January 29, 2009 (IHT) - Hundreds of thousands of workers went on strike Thursday across France, snarling transportation and closing post offices and schools in a sign of discontent with President Nicolas Sarkozy's response to the economic crisis.
... Mass transit in the capital was in chaos, with service on suburban commuter lines reduced or nonexistent, and most subways and buses running well below normal frequencies. The Education Ministry estimated that 37 percent of teachers walked out. In Marseille, the country's second largest city, television showed buses crammed with commuters as subway service was completely interrupted.
Across France, airports were operating at reduced capacity and flights were delayed. The rail line that serves the two Paris airports was completely shut down, stranding arriving travelers in long taxi lines.
As many as 200 demonstrations were planned across the country, including a massive march across Paris in the afternoon.

La Grève...it's a national sport for the French!