CNN Senior Executive Producer
A CNN reporter submitted a script that started with the line: "Airplane maker, Boeing, posted a fourth quarter loss of 56 million dollars." My first question to the reporter was: "Is 56 million dollars a lot of money for Boeing to lose?" I was serious. I don't know what a lot of money is any more.
Too many companies have lost too many billions too quickly for me to get my arms around the value of a dollar. According to the Senate Appropriations Committee, U.S. stocks - that is, stockholders - lost about 7 trillion dollars in value this past year. And 25 banks failed with total assests of $373.6 billion. So when I saw that script announcing that America's biggest manufacturer of airplanes lost $56 million I wasn't sure if I should be feeling, "Oh, my Gosh!" or "Oh, what a relief! ONLY 56 million."
Then came the second part of the story. Boeing, which employs more than 160,000 people from high-tech to low-tech and everything in between, plans to lay off 10,000 workers. Add that to this "bloody Monday" announcement of 71-thousand layoffs by 7 major U.S. corporations. It seems like 10,000 layoffs per company is the magic number this week.
All this helps explain why I saw what I saw at the CVS pharmacy Tuesday night. I was there picking up a prescription. At the checkout counter, on the waist-high shelves, the most prominent space for those last minute purchases where you're usually tempted with candy and gum, was a hefty supply of Campbell's soup. $1.49 a can. I've never seen Campbell soup so prominently displayed at a CVS.
CNN repoter Alina Cho last week reported that Campbell, along with Wal-Mart and other low cost brands, has been a beneficiary of the deep recession. Condensed soup sales are up 14 percent.
And one other thing I noticed at CVS. There, to the immediate left of the pharmacy checkout counter was a tall rack filled with prepaid credit cards. Visa, Mastercard, and other big name brands. They were blank. No application necessary. No credit history relevant. Just cash. You put money on the card and use it until its empty, then fill it up again if you can afford to. There they were, at the CVS pharmacy checkout counter.
These are the bookends of our new economy. Campbell's soup on the right, prepaid credit cards on the left. (Medication in the middle.) It's part of the new American ethic - get your finances under control. Reduce your debt. Pay as you go.
Which helps explain why, at the very moment I was writing this, CNN got an email from Starbucks announcing more store closings and job cuts. The company plans to reduce its workforce this year by 6,000 people. And it plans to close 200 more U.S. stores, in addition to 600 other store closings announced over the summer. Again, to put it in perspective, Starbucks is not a dying company. Coffee drinkers around the world spent $2 billion at its stores during the last three months alone. (And Boeing, by the way, despite a 25 percent drop in sales, still sold more than 12 billion dollars worth of planes and other high-tech equipment during the last quarter of 2008.)
But here's the fine print that tells the deeper story. Look at this phrase from the Starbucks email: "Given the uncertainty (my italics) in the global consumer retail environment, Starbucks is not providing revenue and earnings guidance at this time." Remember that. The economy is in such a state of uncertainty that Starbucks, and a number of other companies, are unwilling to even provide guidance on how much money they anticipate making.
Last night, the House of Representatives passed an $819 billion stimulus package to get the economy moving again and create jobs. How much is a lot of money? Answer: uncertain.
Anderson Cooper goes beyond the headlines to tell stories from many points of view, so you can make up your own mind about the news. Tune in weeknights at 8 and 10 ET on CNN.
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