Let China Buy.
What I learn from the cogent and creative Gene Epstein at Barron's is that the Baby Boomers, born 1946-1964, are the reason that the American consumer has stopped buying. Epstein argues persuasively that advertisers are ignoring the Boomers in favor of pitching to the 18-34 year old, the Children and Grandchildren of Boomers. And this is silly of the advertisers because the Boomers have all the money that is left and buy furniture for their second homes and luxury cars because the branding is cheaper and simpler than painfully changing a personality. All accurate. However what I see here is demonstration that the entire discipline of the U.S. economy depends upon my kindred shopping smart. It may be that we are tired of shopping at all, of it may be that we realize mortality first looks like a lost job and then a foreclosed house and then penury. A sharp version of limits is what happened to our 401Ks and Roth plans last fall 2008. The crash was the Boomer crash. Or it was the (absence of) sunspots.
Politics of Booming.
This also means that the Boomers elected Bill Clinton and Al Gore, then they permitted George Bush to serve, then they elected Barack Obama, and what does this add up to? Whim and shopping for faces. Bill Clinton is at the forefront of the generation, born 1946, and Barack Obama is in the caboose, born 1961. Same aimless consuming, same fear of limits, same appetite for new gadgets. And now a collective shrug at the second rate status of the US economy. Let China buy. And make healthcare cheaper, or less costly, or just make it go away. And let's get to the moon again, and Mars. The politics of the Boomers remain consistent with our youth. We regarded Vietnam as a mistake (read Iraq, Afghanistan); we thought Apollo 11 was cool (read NASA to Mars); we regarded pleasure as obvious (see Letterman); and we were smokers, drinkers, drug users and thrill seekers (see Hollywood); also, we didn't trust government and still don't. The present Great Recession and job crater is entirely the product of Boomers deciding to take a break from the branding. Will we return? Sure. But not any way obvious now. Which is why those products that will win are not obvious. I like Apple stuff. And audiobooks. And biking. And entertaining the children. What do you like? Moon Base 1? Kepler and the Sister Edens? Sunpots? What will be the winners?
I'm afraid Gene misses the mark. I'm a baby boomer and I know exactly why I'm not buying. It's my way of protesting a government that has become alien; unresponsive; non-caring; intrusive; thuggish; oppressive; stifling; arrogant and just plain silly. Not much I can do about it, but what I can do I will do. I've put the brakes on buying.
I need a new car, but I've put it off. For years now, I've been called a 'pig' for spending too much; for depleting the planet of its resources; for being the cause of 'global warming'; for killing polar bears and snail garters. Well, I'm sick of it. I'll do exactly as they say. I won't spend a dime I don't have to. And what's more, I'll gladly leave the country to escape the hangman's noose. In short, I think we're on the way of strangling ourselves. I’ll return, of course, after we’ve got it all sorted out. In the meantime, I'd just as soon be somewhere else and watch.
http://peterkoelliker.blogspot.com/
JB raises Epstein a bit above his actual stature. He's been off the mark on may issues over the years. One maybe lumping the boomers together. It makes for zippy copy and sounds learned but I'm not so sure. As a 1947 baby I can see a lot difference between my priorities and those of someone in the second last year of the boom who would be about 45. The boom is big enough to meaningfully analyze in parts. A 45'er has 20 years to get his savings back to kilter; Peter and I have about 3-4. My buying behavior is going to be different than that relative kid.
My guess is the consumer companies that do good market research see the break at 50 right now. If you're over 50 and out of work you've got a problem so far as career goes. Or at least you better prepare for such and that means the local pub vs the center city $$$$ new restaurant.
I would market to those two segments more differently than I did two years ago.
I DON'T BUY THAT BOOMERS WERE BORN IN THE LATE 50s/EARLY 60s.
I'll go up to 1955. But that's it. When the Boomers are defined as '46 to '64 it's such a large group you can ascribe anything to it. And, even though, Obama has a 60s/left attitude that doesn't make him a Boomer. Ayers is the Boomer. That said, Gene and Peter both make a lot of sense. And, as always, so does JB. I think what JB is describing is 60s envy by 60s wannabes, who'll never admit that they are 60s wannabes. The protesters in Pittsburgh were all over the place - no one issue, but excited to protest. However, they didn't have, and will probably never have, the enthusiasm, sense of freedom and overall fun (aside from the beatings) that protesters had in the 60s. That may be because they also didn't live in the 50s and so didn't know the repression of that era. They can never know the freedom exemplified by "Hair", because most never had to wear crew cuts. Do the non-Boomers know that you couldn't wear jeans to High School in the 50s? There's an irony here, as well. The conformism/Nation of Sheep of the 50s has turned into the political correctness/conformism of the 21st Century. David Amram's song, "Fabulous 50s", has a good take on what led to the 60s.
Darn right I've stopped spending. What I am doing is spending down. I lost my job in January (credit crunch venture capital funding problems cancelled my job) and last week secured my first interview after *9 months of searching*. The recruiter who scheduled my meetings told me that he's been watching me apply online at his company for months but he hasn't had permission until 2 weeks ago to talk to anyone outside of the company.
Oh, and the job is a 6 hour drive from my home in an area so expensive that they can't hire locally because they can't pay enough. If I take the job I'll have to live out of a suitcase. But I'll take the job if they offer it to me because I can't take the pain of being out of work any longer. Even if it means I can no longer see my wife or grandson 5 days a week.
Not the kind of change I was hoping for.
Although I had been happily ignorant of Gene Epstein's blather, now I must add his name to the roster of such intellectual lightweights as Thomas ("the world is flat") Friedman, Stephen ("abortion cuts crime") Levitt, Chris ("long tail") Anderson, and Richard ("rise of the creative class") Florida, all of whom lend weight to Mencken's contention that no one ever went broke underestimating the intelligence of the American people.
Mr. Batchelor, do you really find this stuff any more convincing that absurd little astrologer that you had on your show a year or two back? If so, I have some Iraqi weapons of mass destruction to sell you.