Product Comparisons

Consumers and the State of the Union
by Eva Forman on January 25, 2012

I’m no expert in economics (as my college econ professor will certainly testify), but I know enough to be pretty sure that the state of the economy is likely to impact me as a consumer. That’s why it was worth paying attention to President Obama’s State of the Union address yesterday. He spoke about job creation and specifically tax benefits for companies that move production back to American soil. Besides supporting start-ups and creators of small businesses, the speech also addressed the issue of fair trade practices and making sure that U.S. businesses are on a fair legal footing to take their share of the international market. President Obama also talked about investing in the creation of alternative energy sources. So what does this mean for us as consumers?  For those of us who are secure in our jobs, the impact may be fairly subtle. The price of fuel and energy resources may be the kicker for us. If oil prices are high, then shipping and manufacturing costs go up and the expense is usually passed on to the consumer. That’s in addition to the more obvious cost of electricity for your house and gas for your car. That means that taking the usual bus to the mall to buy the exact same toaster and then coming home and making an identical piece of toast to the one you made a year ago, will cost more than it used to. These added costs are even paid by companies who are strictly online. Whether they need tons of electricity to keep servers running or just have to pay to keep the office lit and buy some coffee for the break-room, their added costs will also be reflected in the price of their products. For some people however, the impact could be much more direct. More jobs in the country means it’s more likely that you’ll have one. It also means that you can expect higher wages, since employers know that workers are less desperate to stay in a mediocre position. All of this is reflected in consumer confidence polls, such as those conducted by Gallup and Bloomberg. They can give a good picture about how much Americans will be willing to spend in the near future and can give you a hint as to whether other consumers are planning their spending the same way you are. So no matter how you plan to vote in November or where you think the economy is headed, be sure to stay on top of the news. Since you’re here, I can be sure that you’re a responsible consumer who likes to do your research before making a purchase. Although it might make no difference in your decision about which product to buy, it’s always good to have a view of the bigger picture.