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Economy Strains Under Weight of Unsold Items
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| Contributor | ArmyDem |
| Last Edited | ArmyDem Feb 17, 2009 06:42pm |
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| Category | News |
| Media | Newspaper - Washington Post |
| News Date | Wednesday, February 18, 2009 12:00:00 AM UTC0:0 |
| Description | By Annys Shin
Washington Post Staff Writer
Tuesday, February 17, 2009; Page A01
The unsold cars and trucks piling up at dealerships and assembly lines as consumers cut back and auto companies scramble for federal aid are just one sign of a major problem hurting the economy and only likely to get worse.
The world is suddenly awash in almost everything: flat-panel televisions, bulldozers, Barbie dolls, strip malls, Burberry stores. Japan yesterday said its economy shrank at an 12.7 percent annual pace in the last three months of 2008 as global demand evaporated for Japanese cars and electronics. Business everywhere are scrambling to bring supply in line with demand.
Downsizing can be tricky, though. No one knows how much worse the economy will get, and while everyone waits for the recession to peter out, businesses are grappling with how to cut costs and survive without sabotaging their ability to grow when the economy picks up.
And there is a lot to cut.
"There is over-capacity in everything," from "retail to manufacturing to housing," said Richard Yamarone, chief economist at Argus Research. "If capacity is too large, you don't need that many people employed, which is another reason we're seeing such high job losses." |
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