Thursday, August 6, 2009

Snapshot of the Nation - on Page One of the WSJ...

Front page of the Wall Street Journal today had two stories that offer a vivid picture of where we are today as a nation.

The first story, above the fold, tells the story of the fee bonanza Wall Street firms are experiencing, thanks to the work involved on the AIG breakup. The lawyers and bankers on the job "could collect nearly $1 billion for IPOs and advice..."

The second story, below the fold, talks about how the "tide" has turned for Proctor & Gamble, with the company reporting an 18 percent loss in 4th quarter profits. The loss is attributed to the fact that "sales of their premium-priced brands shrank amid tightened consumer budgets."

So in some stores, P&G has launched "Tide Basic" - a cheaper version of their popular laundry detergent "that the company freely admits isn't 'new and improved'" and lacks some of the capabilities of the full-strength product. According to the WSJ:

"It's very existence is one of the most telling signs to date of how the sour U.S. economy is forcing mass marketers to shift course."

The launch of a non-premium detergent was an agonizing decision, apparently, but one P&G felt forced to make, given the terrible market conditions out there beyond Wall Street. A product that was "never about price" suddenly had to deal with consumers who cared only for pinching pennies.

Boom and bust - going hand-in-hand in America.

No comments: