EconomicGreenfield

Yesterday, CBS aired a segment on its “Sunday Morning” show titled “America’s new poor.”

While dynamics similar to those discussed in the segment have been noted in previous posts on this blog, this segment is yet another notable reminder of the changing economic condition and the growing need for food assistance.  This segment focuses on an area, Forsyth County, near Atlanta.

Here are some excerpts that I find especially notable:

But for more families here, prosperity is a pretense. The job’s lost, the savings are gone, and the big house is either in foreclosure or on its way. And just keeping food on the table is a struggle.

So Forsyth’s newly-needy file into local food banks.

Yesterday’s GIVERS have become today’s TAKERS.

also:

“The new poor could be you, me, your neighbor, your church member, somebody who has been affected by the economy,” she said. “Many of our people who have come for assistance used to be our donors. And they’ll say, ‘I never thought I’d have to do this, never in my wildest dreams.’”

also:

Nearly 15 percent of Americans are now receiving food stamps, a record level, and a jump of about two-thirds since 2007.

One in SIX Americans – 49 million people – say they have trouble putting food on the table.

At Forsyth County’s Lambert High, eight percent of kids now get free lunch, double the number three years ago.

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The Special Note summarizes my overall thoughts about our economic situation

SPX at 1215.65 as this post is written

Yesterday CBSChicago.com had a story titled “Study Finds 1 in 5 Chicagoans Are Hungry.”

Although the entire article is worthwhile, I find the following excerpts to be most notable (and disconcerting):

The Greater Chicago Food Depository has, for the first time, done a neighborhood-by-neighborhood breakdown of hunger in the Chicago area.

As WBBM’s Mike Krauser reports, some of the numbers are staggering.

The numbers are growing—and about 20 percent of Chicagoans are hungry, a new analysis found.

also:

As CBS 2′s Derrick Blakley reports, the report found nearly 850,000 people in Cook County aren’t sure where their next meal is coming from.

also:

At St. Sylvester’s Pantry in Logan Square, the story’s much the same. Three years ago, they served 225 families. Now, they serve more than 800.

Deacon Fred Ortiz said, “We have people that have been in banking, people that have been in teaching, medical fields. We have seen a very, very big increase in that type of client coming in for service.”

Overall, the Chicago Food Depository says visits to food pantries are soaring, up 58 percent in the last three years.

Depository CEO Kate Maehr said, “That hunger is not restricted to one neighborhood. It’s in every community and every suburban community in our county and across our state in record numbers.”

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The Special Note summarizes my overall thoughts about our economic situation

SPX at 1126.84 as this post is written

On October 30 The Chicago Tribune had an article titled “Trying to keep up with hunger.”  The article was about food assistance provided by the Northern Illinois Food Bank, of which Dennis Smith is executive director and CEO.

There are some interesting (and disturbing) passages in the article.  Here are a few:

“‘The number of people visiting the 525 food pantries, soup kitchens and youth locations across the region has gone up 35 percent from a year ago,’ Smith said.”

“‘Hunger is exploding in northern Illinois and the small agencies are being hit harder than ever before,’ Smith said.”

“‘A lot of the people we’re seeing today have never been to a food pantry before,’ he [Smith] said during the Oct. 22 tour.”

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The last quote shown above further reinforces a trend that I commented upon in a July 15 post.  I called this trend the “first time of adversity” effect, a very important concept.  Here is that July 15 post:

http://www.economicgreenfield.com/2009/07/15/first-time-of-adversity-effect/

SPX at 1104.90 as this post is written

There was a recent article in The Wall Street Journal titled “Detroit’s Food Banks Strain to Serve Middle Class”:

http://online.wsj.com/article/SB124718194179420129.html

One aspect that caught my attention was the mention of people who are receiving aid for the first time.  In fact, the story points out that some people who used to be donors to the pantry are now requesting assistance.

During this period of economic weakness, this “first time of adversity” effect seems especially commonplace.  It can take many forms, from those who are being laid off for the first time, to those who are receiving food assistance for the first time, to those who are unable to make payments for the first time, etc.

This “first time of adversity” effect is also very prevalent in many aspects of business as well.  For example, I recently heard of a retail store that has been in the same location for 30 years, and now has decided not to renew its lease.

The prevalence of this “first time of adversity” effect supports my theory, mentioned previously on this blog, that we are in a “new (economic) environment.”  Many people as well as businesses that have never before  encountered difficulties are now (unfortunately) doing so.

In my opinion this “first time of adversity” effect is very important information; and the “new (economic) environment” theory/reality is of tremendous importance.

SPX at 922.25 as this post is written

Copyright 2009 by Ted Kavadas