Pinched at the Pump ?

For those of you who still doubt that consumers are being pinched at the pump — assuming yesterday’s Existing Home Sales and today’s Durable Goods numbers didnt convince you — consider the following, via Joanie McCullough:

"We are now cruising along with $2.61 per gallon, regular unleaded, as a national average.

Of course, the high cost of energy hasn’t laid a glove on any of us, right? But I thought you might like to take a gander at a few snippets talking about how some are coping at the moment:

** A small florist chain in Detroit can’t afford hire any more drivers for van deliveries, so they have hired runners to get the job done. (Can you imagine luggin’ a 6-foot funeral tribute across town?)

** A few school districts in Virginia, reeling from the costs of diesel (public schools are exempt from state and federal tax on fuel, mind you) to fire up the school buses and facing the winter heating season, are about the business of adjusting the bus routes. Bottomline: The kids will have to walk further distances. I wonder how the BLS will handle this development, eh? Probably a seasonal adjustment to footwear prices. Down, of course.

But it gets worse: According to South Carolina’s Department of Education, every one penny increase in the price of diesel, jacks their overall transportation expense by $120k.

** The owner of a Chicago dog-walking service says 5 of 27 of his “walkers” are now using bicycles to commute instead of their cars. (Walkin’ Marmaduke all over the county in this heat and then hop on the old Schwinn and pedal home? SOS.)

** A Phoenix-based pizza chain (Streets of NY), recently raised the delivery charge from $2.00 to $2.25. And is in the process of raising all menu prices. Cited: All of its suppliers are adding fuel surcharges on all deliveries to them. (Hold the pepperoni.)

** A Flagstaff-based plumbing business has added a $10 surcharge for “house calls” that exceed a 10 mile trip. The local AC repair has made that a $5 buck surcharge on all “house calls”. (Shower less and keep the windows open!)

** Moving house? Egad. I can’t recap in this space all the instances in all geographies of anecdotal stories of either outright surcharges or significant increases in the hourly rates charged. (Read: Stay put until further notice.)

A couple along more serious lines:

** Mayday: New-boat sales statistics from the Northwest Marine Trade Association indicate that sailboat sales were stronger than those of motor-powered vessels during the second quarter of ’05, as fuel prices have been climbing upward and the higher  prices have been given much media attention. Specifically, sail craft sales rose 4.3% y/y while motor yachts dropped by 8.1%. And look at this: Sales of new pleasure craft of all types were up just 1.1 percent in the second quarter of 2005, a substantially slower  pace than the year before when overall growth hit 15.7 percent for the year.

** Seeing the boating info, you knew this was comin’: Q2 (usually the strongest quarter  RV sales hit the skids. The big 3, Fleetwood, Winnebago and Monaco all cited rising oil prices in some way shape or form. While this is not a commentary on value in this sector as far as the market goes, currently, there are 141 domestic manufacturers in the RV biz. Whew. 141.

So there you have it, a few tidbits of info regarding the higher energy costs which, of course, are not being pushed thru to the consumer. Forgot one: Independent toy shops are jacking prices of plastic toys (petroleum-based) by up to 20%, whereas at the moment, wooden toys are remaining stable. How about a plywood Barbie for Christmas? I think you get the drift.

Next case.

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The Future of the Music Industry

Music industry insider Bob Lefsetz gives us brief history of the Music Business, and a fascinating vision of what the future of the industry might look like:

"What if it’s over.  What if everything this business was built upon, everything we know, is disappearing.

Well, this business WAS built upon music.  But that was a long time ago. 

That was before everybody got greedy.  Before it was demonstrated how much MONEY there was in the music business.

Oh, there’s always been a music business.  Back to the days when cavemen were banging on rocks and people sat around and listened.  But the sixties were different.  We had recorded music, and a large ready audience, i.e. baby boomers, with the money and wherewithal to buy it.

Before the sixties the single was the dominant format.  First 78s, then 45s.  You can’t make much money selling singles.  Just ask the labels how profitable iTunes is.  And, there wasn’t much money.  There was a depression.  And then a war.  But when rock and roll hit, when the baby boomers came of age, when the Beatles turned it into an album format, purveyors started COINING DOUGH!

You HAD to have the Beatle album.

And the Beatles and the San Francisco sound begat concert venues.  And press to cover the scene.  And suddenly, music was the driver, the hippest art form extant.

And the MONEY!

First there were the records.  Then, Led Zeppelin changed the live deal.  To 90/10.  And everybody wanted to SEE Led Zeppelin.  There was no venue too big, they could sell every seat of a stadium.

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