Secret signals that the recession is lifting?

Saw Steve's Tweet.

Beauty salons have a pulse on this - the frequency of pedicure and manicure customers will start going back to weekly or bi-weekly visits instead of monthly, which is brutal for many ladies. :)

My girlfriend and I were in San Francisco last week for the 4th, and we were comp'd several items on our stay randomly by waiters and managers alike. No clue why. I haven't gotten anything free in years.

Living in Florida, the lawn is a strong sign of how you are doing financially. A healthy one needs a working irrigation system and plenty of fertilizer, both of which require money. That said, I see dozens of spotty lawns and more every day.

The economy isn't getting better and likely won't for quite some time. Cut taxes, eliminate governent spending, reduce government regulation, repeal the stimulus, stop interfering in open markets,and get out of the way of entrepreneurs and we'll have a fighting chance, but how many more failures will it take before people realize Keynesian economics is a fairy tail. You can't spend your way out of a recession.

Some ideas:

Nobody at the flea market

The size of restaurant tips

Used car sales go down

More people voluntarily quit their jobs

More flat screen TVs per home

More No Vacancy signs outside hotels

Fewer For Sale signs, especially on McMansions

Lawn service companies can't keep up with demand

More upgrades to first class

Length of lists of people waiting to join private country clubs

Attendance at business conferences rises

Steve -- One potential and somewhat unusual litmus test for how a region's or even a city's economy is faring? Fireworks sales around the recent 4th of July holiday. I was in Salem, Ore. for the 4th, and several locals commented that sales were up this year. In other areas, like back home in Raleigh, N.C., they were steady. And in still others, like South Bend, Ind., they were down (see Google News search for "fireworks sales up" -- http://bit.ly/lJP7p),

Mike

James, I'd say that if you're getting comped left and right in San Francisco, those people are helping you cope with the recession, not signaling its end.
Mike, interesting about the fireworks--unless fireworks fall into the same oblivion-seeking category as drugs and alcohol.

I have noticed a few things indicating the economy is making an upswing. First I have observed more cars with "paper” license plates in our metro area which means people are buying cars. Second, our local temp agencies are quite busy recruiting. Third, our storage business is up significantly indicating IT spending is on the rise. http://twitter.com/Steve_Visconti

A couple of personal encounters with some small signs that the recession might be shifting - in the right direction:

1) A "thicker" Sunday Employment section in the Washington Post ... an indication of a lift on hiring freezes? Let's hope so.

2) A client that is ramping up efforts to continue with its launch of a new industry trade magazine (confident that the market will welcome it, not deterred by the economy nor downslide of newspapers/magazines).

3) Flights out of Las Vegas the week of 7/20 virtually booked, with only a few middle seats remaining. (Sure, could be because of cheaper fares but for awhile, nobody was booking flights, regardless of cheap flights)

4) Increased interest in re-igniting marketing and PR campaigns (clients & referrals I've spoken to).

5) Two "new" PNC banks under construction in Northern Virginia (strange, I know, but still ...)

6) National industry trade association's Annual Meeting in October in Boston on pace with last year's registration & sponsors, with recent pick up in numbers (not indicative of the freeze on travel, budget/sponsorship cuts, etc.)

And, honestly, people, in general, just don't seem to be so grumpy and negative. Instead, I'm seeing a lot of collaboration - both online and in smaller settings. People seem to be more positive -- Whether they are channeling optimism and hoping that it takes hold - or are just ignoring the negative things around them - it's a refreshing change to the black cloud that has been looming overhead for so long.

Susan
Twitter @SusanEJacobsen

Good point on drugs and alcohol. Formally this refers to the distinction economists draw between different kinds of goods. Interpreting the increase in fireworks sale as a sign of recovery would be correct if fireworks are "normal goods" (goods whose demand moves proportionally with income increase or decrease). But fireworks could be a different type of good.

If there is a term for goods like alcohol, whose demand increase during recessions, I am unfamiliar with it. But perhaps Mr. Baker could use this piece to coin the term for such types of goods (it would be a useful term indeed). "Recession goods" is my unoriginal, straightforward and humble suggestion from Caracas, Venezuela.

Another point to remember is that recessions change consumer behavior and what we perceive are normal vs. luxury goods. In other words, we should also bear in mind that the effect the recession has over people's budgets may even change our notion of the type of good a product is. Take the case of the $2 Starbucks coffee: it went from being the daily indulgence of the many, to becoming the luxury of the few. With fireworks, the opposite may have happened. The fact that it is relatively affordable could have made it more appealing, boosting sales. If that is the case, then interpreting the surge in fireworks sales as economic recovery may be quite mistaken, because it is actually a sign of consumers tightening their belts for the long ride back to the happy days of the economy.

This is why using demand for starbucks coffee may be one of the safest bets there are for a "secret" economic indicator. In any case, will be waiting eager to read the final piece!

Restaurants are still empty or no wait for dinner on Fri and Sat nights. When I start seeing waits again or full dining rooms, I'll feel like that's a good sign.

While hospitals were certainly hit hard last year with lower admissions, declining portfolios and margins and virtually no access to capital, I believe the healthcare space has turned a corner and we’re starting to see signs of improvement. Recently, I attended a Health Management Academy’s CFO Forum that represents half of hospital beds in the US. And, unlike a similar meeting last October, the hospital CFOs weren’t out to mob all the investment bankers in attendance. The heightened sense of morale and optimism was encouraging.

A few other promising trends that I’ve picked up on during my discussions with hospital executives and industry leaders include:

- Bond raising is coming back from the brink of disaster – more than $2 billion in municipal bond capital has been raised since January with virtually zero activity prior to that and a number of new issues are in the queue for the first time in over 18 months.

- Hospital margins are improving - through a combination of unprecedented cost cutting, stabilized investments and gradual improvement in admissions the average non-profit hospital margin has increased over 50% from the low in Q4.

These trends – coupled with the promise of $30 billion of ARRA stimulus money for healthcare IT and the prospect of a better payer mix under healthcare reform – shows that the overall prospects for the hospital industry are much brighter than the start of this year.

Thanks for all your input. I'm putting together the slide show that will run next month. Saul, goods or industries that do well during a recession are typically referred to as countercyclical -- although alcohol is probably just all-cyclical.

I think we need to use are money wisely and the state needs to budget our funds so we have something to fall back on if we need it at the rate we are going we are not going to get far if nothing changes are economy is slowly dwendling down.