Taking Stock of Bonds

January 15, 2008

Exhibit A

Sometimes the finance markets get so caught up with numbers and statistics that the data lose their meaning. Oil at $100 a barrel. Fed funds at 4.25 %. The Dow or Nasdaq up or down by whatever percent. A jobless rate up at 5%. The swirl of numbers can become a blur.
 
But, there are times when a vignette offers greater insight into the condition about the nation's economy. Investors, bankers and  bank regulators may want to consider the following memo delivered to my doorstep this weekend from the folks who deliver the newspapers to our apartment building. English is not their first language, but their point ought to be clear enough. They have abandoned their newspaper route because they cannot afford to keep delivering newspapers by car. They live in a nearby town in Westchester County where -- as with most suburban communities -- you cannot readily get around without a car.
 
        "To who it may concern:
        I am resigning from NY Times after 16 years. I would like to thank all of the customers for you're patience and patronage. I can no longer work for the pay wage or the increase in gas. But am thankful for having the opportunity working for all the customers on my route."
 
It's not certain what line of work the couple who delivered newspapers will get into, but the fact that they abandoned their route because of high gas costs may illustrate how hard-working families are being squeezed by rising costs. If a person cannot afford to pay for gas that they need to do their job, where will they go to work? Will the next job pay better? How will they pay off their existing debt - that car loan, the credit card or the home loan - if they cannot find a better paying job?