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Women Mean Business, Autumn 2013

Posted by Jill Kerby on August 30 2013 @ 12:25

WILL THE RETURN OF CREDIT (SOME DAY) TEMPT THE RECOVERING SHOPAHOLIC?

Are you a recovering shopaholic? 

Have you abandoned your silver, gold or platinum card for …shudder…a bank debit card, or even a cash-only, no frills, no fees credit union account?

Do you still feel the urge to spend money you don’t have on stuff you don’t need as you walk down a popular shopping street or through a mall on your way to the discount grocery store?

Have you ever had a slip?

According to the Central Statistics Office, the good news (sort of) is that the entire country is still pretty much committed to its collective 12 step programme after a decade of bingeing on SUVs, designer kitchens, handbags and elaborate personal grooming services that were, frankly, the most ludicrous, wasteful  expenditure of all. (We are large boned, pink-faced Celts for crying out loud…)

Last June’s CSO statistics (the most recent at time of writing) showed that retail sales continued to drop by 1.6% that month compared to May 2013 and by an annualised rate of -1.5% for the year.  We did buy more books, newspapers and stationary in June (+3.5%) than in the previous month, but furniture and lighting shops were crucified (-12.3%) as were new car sales (-7.9%). 

Clothing and footwear was flat as a sandal at -0.5%, and even pharmaceuticals, medical goods and cosmetics, which should have been in demand given the weather up to then, were down a significant -3.8%.

The only sector with a huge boost was hardware, paints and glass sales, up nearly 10% on the previous month.

The stats are pretty much par for the course these past five years and evidence that we’ve pretty much abandoned the style, manner and volume of shopping we succeeded at during the boom years.

In that time, I think we’ve also discovered some unpleasant home truths about shopaholicism, such as, 

-       It especially strikes those who are hopeless with money anyway and who suddenly have access to cheap and easy credit;

-       Shopping is more fun than doing repetitive chores, visiting relatives or going to church during your spare time;

-       Having a line of easy credit makes you forget that your income hasn’t really been rising as quickly as the cost of living;

-       It happens gradually, then quickly, especially when your child’s teacher, the cleaning lady, the chit of a girl at the nail bar always seems better groomed/dressed than you or drives a better car;

-       Cheap/expensive stuff is just so alluring in the shop with its flattering lights, mirrors and fawning staff (ok, that never happened in Ireland) and the subliminal message for everyone to buy, buy, buy.

There are now digital libraries full of the pseudo-analysis about what happens in our brains when we buy stuff that we like the look or taste of, such as fancy red-soled shoes, chocolate and muscle cars.  They all conclude that the  “I’m worth it” factor is not just seductive, but also short-lived, which is why shopping can be so addictive. 

You don’t need to have taken Psych 101 to understand what such feelings can do to the weak-minded, or their even weaker-minded bank managers when both are exposed to endless cheer-leading by the media and markeers and tax-addicted politicians.

What I‘m wondering now, with all this talk about the bottoming out of the property market, the ending of our infamous Troika programme and the restoring of our sovereignty (that is, the return to global creditors instead of the EU/ECB/IMF), is whether there’s a danger that we could end up back on a regular fix of credit card, bank and mortgage loans?

Could the shopping virus that infected the nation in the naughties – the retail version of smallpox, successfully eradicated in the 1960s - unwittingly, or god forbid, intentionally, be let loose again on us by the politicians and their creatures in the central banks who artificially manipulate the price of money?

So far, it looks like only failed countries and banks that have been “successfully” bailed out with taxpayer’s money (and the future taxes of the unborn – a very special sort of consumer in Ireland) are being facilitated with a new crack at the credit punchbowl. 

As much as the retail banks are dying to extend the sweet elixir of credit again, they’re still unsure of exactly who’s good to pay it back.

Since modern economies are now wholly reliant on cheap credit and cheap energy – hence the global nature of this five year economic downturn – it’s only a matter of time before someone slides up to you and offers you a new credit injection.

It might look innocuous – and you really need that new washing machine – but it will be the first step back to that dark place filled with hair extensions (for the lapdog), diamante encrusted water bottles, Japanese garden features, and Croation buy-to-lets.

So consider the following:

-       Just say No!  (If it worked for the global cocaine trade it can work for the euro!)

-       Keep doing your 12 steps and stick close to your ex-shopaholic buddy.

-       Switch to an on-line only bank account with confusing, software. Your inability to manouvre through the useless website might just be enough to delay hitting the ‘proceed’ button.

-       Switch to the slowest, worst broadband/mobile package to discourage any temptation to shop the internet instead of the high street.

-       Avoid all contact with French-polished nails.

-       Move to Bulgaria, Albania (with their non-exchangeable currencies) or any other bankrupt European country without a printing press of its own. (This now pretty much includes France and Italy). Not only is the risk of getting cheap credit nil to zero, but countries like this haven’t even entered, let alone exited bail-out programmes.

Meanwhile, if you are a retailer, and still in business, you have my deepest sympathies and sincerest good wishes.

You are the true heroes of our modern age. You’ve somehow managed to keep supplying the necessary goods and services that we really need, rather than simply want, while paying suppliers and staff and keeping the banksters at bay. Hopefully, you’ve paid yourself this month as well.

It couldn’t have been easy remaining sober when everyone else was on the tear, even if it did mean some very nice short-term profits. As you have learned, too much credit not only destroys the infected shopaholic but it can spread to the relatively healthy shoppers too.

There’s a vaccine, of course. It’s called sound money. The kind that can’t be printed from thin air, has to be backed by real capital and that has to be earned and saved before it can be spent or lent out.

Thank goodness then for the October budget. I can’t imagine a more successful method of containing a new outbreak of shopaholicism.

That, and the sight of Minister for Finance, Mr Noonan reminding the nation that the medicine he’s prescribed, “is for our own good”.

 

Ends

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