When the economy goes south, one name invariably surfaces on the lips of pundits and economists: John Maynard Keynes. That is because the twentieth century’s greatest economist is generally associated with the idea that markets require government intervention in order to function properly. But Keynes’ ideas were not just a prescription for an ailing economy; they were a complete theory of capitalism.
The recession is taking a serious toll on American retail, but e-commerce could emerge as a winner.
According to a new report by Forrester Research, e-commerce sales (beyond travel) are likely to grow 11 percent to $156 billion in 2009. That marks a slowdown from 13 percent growth last year and 18 percent in 2007. The major factor contributing to the pace shift is, of course, declining consumer confidence.
Yes, this may be the worst recession America has seen since World War II. But the people who are bringing us the Consumer Electronics Show would like to point out that sales of tech products are actually faring pretty well when compared to what happened during previous recessions.
Over the past few months, Americans have been hearing the word “depression” with unfamiliar and alarming regularity. The financial crisis tearing through Wall Street is routinely described as the worst since the Great Depression, and the recession into which we are sinking looks deep enough, financial commentators warn, that a few poor policy decisions could put us in a depression of our own.
Things keep getting worse for Corning, as demand for large-screen LCD televisions sags in the face of a global consumer recession.
The LCD glass maker this morning said it is now withdrawing the financial guidance it provided just a few weeks ago for the fourth quarter and for 2009.
In a statement, CFO James Flaws said that “Panel makers, particularly those in Taiwan, have continued to reduce the utilization of their factories heading into the second half of this quarter in response to weakened retail demand for LCD televisions and desktop monitors.”
Corning’s third-quarter results and fourth-quarter outlook appear to reinforce logic–in a recession, big screen TVs do not count as necessary luxuries. LED glass volume is projected to fall 10-20 percent in Q4–20-30 percent within Corning’s wholly owned glass business. CEO Wendell Weeks says the company plans to greatly reduce capital spending and development and engineering costs.
Blu-ray is in a death spiral. Twelve months from now, Blu-ray will be a videophile niche, not a mass market product. With only a four percent share of U.S. movie disc sales and HD download capability arriving, the Blu-ray disc Association is still smoking dope. Even $150 Blu-ray players won’t save it.
Comcast’s earnings get announced before tomorrow’s opening bell, but the company has a couple of things going for it that might be helping analysts predict what those numbers will look like. First, 70 percent of consumers prefer bundling, and currently only cable can offer it. Second, even as we head into a recession, broadband and video are considered “no more discretionary for most families than running water.”
If we’re in a recession, you wouldn’t know it from looking at Amazon.com’s (AMZN) June quarter results.
Amazon shares are up sharply in an otherwise ugly market Thursday morning, propelled onward by some gushing post-earnings commentary from the Street. The key point: The company’s revenue in the June quarter actually accelerated from the March quarter, despite a weakening economy.
No one has official said we’re in a recession. But consider this: Apple (AAPL) thinks the economy is “depressed.”
As Michelle Leder points out in her always-interesting Footnoted.org blog, Apple’s latest 10-Q, filed yesterday with the SEC, includes some new language about the economic risks the company faces.
The economy may be teetering, but the personal computer business is still nimbly running at full speed, according to the tally of sales in the fourth quarter of 2007 from International Data Corp. Worldwide, 77.3 million PCs were sold in the quarter, up 15.5% from the fourth quarter of 2006. That represents almost double the growth rate of 2005 to 2006.
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