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The weekly newsletter for everyone interested in barter--the world's most versatile business tool!

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November 13, 2001

California Represents Western States' Best Hopes To Weather Economy This Winter

California has more residents than many countries, some 33.9 million. And it looks like California will once again power domestic tourism in the Western states, because everyone targets California--where the people and the dollars are.

New advertising being rushed into California's major markets echoes the strategies tourism agencies typically rely on as the national economy slows.

Inasmuch as Californians account for 85% of the domestic travel completed inside the Golden State, a new advertising campaign is urging residents to "rediscover California" rather than head out of state.

But other states clearly hope to woo Californians during the winter. Nearly a quarter of Arizona's 26.7 million visitors last year came from California.

Nevada and Hawaii are the two states with the heaviest dependence upon tourism dollars on a per capita basis, with Southern California regularly generating 25% of Las Vegas' tourist traffic. And Los Angeles and San Francisco are the top two markets for Hawaii.

Accommodations available on barter are plentiful, and although there's a growing interest in barter--new companies joining trade exchanges--existing members are still reluctant to travel, and not taking advantage of the travel availabilities within the barter marketplace.

World Trade Organization Reports Severe Contractionary Pressures

According to David Orr, chief economist for Wachovia Securities in Charlotte (NC), "This is about the worst global situation since 1973, we've never had a situation since then when all the regions of the world were either in recession or headed toward a recession at the same time."

The Geneva-based WTO, which oversees trade among its 142 member nations, says the total volume of merchandise trade is expected to rise just 2% this year, a sharp reduction from last year's 12% growth rate.

The new estimates are based on levels of international commerce during the first half of the year, and may not fully reflect the effects of the Sept. 11 terrorist attacks.

The technology sector has slowed considerably, with worldwide sales of personal computers falling this year for the first time in the industry's history. Other factors contributing to the slowdown are higher energy prices and tight monetary policies in the leading industrial economies during most of 2000.

Strong Pro-Spam Lobby Big Spenders

According to CIO magazine, don't expect legislation barring spam to be passed into law anytime soon, despite the fact that spam bedevils almost everyone in corporate American today. The reasons for that are complex.

According to Everett-Church, who is a member of the Coalition Against Unsolicited Commercial E-Mail, anti-spam activists are sorely out-funded by the pro-spam lobby, which includes large financial-services companies and the Direct Marketing Association.

And, even though an estimated 30% of the 30 million messages coming through the AOL network every day are spam, AOL Time Warner is not backing anti-spam legislation because it wants to reserve the right to send its own commercial messages, according to Everett-Church. Most of the other large ISPs feel the same, he says.

Everett-Church points out that it costs next to nothing to set up shop online, justifying the estimated positive spam response rate of well under 1 percent. "All the spammer needs is one or two hit rates per spam run and he'll be happy. Sadly, there are at least one or two idiots per million people."

Executives of public companies don't like to talk about spam, he says, because they don't want the world to know just how much it costs them. "When part of your IT budget depends on whether Billy Bob in accounting signed up for a pyramid scheme, that's not something they like to talk about," Everett-Church says. "With spam, it's an ongoing guerrilla war."

Here And There. . .

  • Non-performing loans in Asia have risen to $2 trillion--equivalent to almost 30% of the region's gross domestic product, according to the Ernst & Young Asia Pacific Financial Solutions Group. With the global economy slowing, these problem loans are expected to be an enormous drag on the Asian economies.
  • Telecommunications giant Global Crossing Ltd. is bartering to save the company some much needed cash....by announcing that it will pay a dividend to holders of its senior exchangeable preferred stock in preferred stock instead of cash. (The move will save Global Crossing about $26 million.)
  • Never seen a copy of BarterNews? Go to our home page, www.barternews.com, and click through to the form for your free sample copy. (Due to shipping costs, offer available in U.S. only)
  • The tab for the terrorist attack in New York and Washington (DC) is estimated to be somewhere between $25 billion and $60 billion. (This would include the destroyed World Trade Center worth $4 billion, the lost assets of the building's tenants, and the $10 billion cleanup cost, plus damage to surrounding buildings and the Pentagon, the planes lost, and the lost productive capacity of those killed.)

    Even with a $60 billion loss, according to Gary Becker, a Nobel laureate in economics and a professor of economics at the University of Chicago, this disaster must be put in perspective. Becker believes the economic future is still highly promising given the total physical assets in the U.S. are about $30 trillion, and the total productive assets including human capital are on the order of $100 trillion!

    In short, the U.S. has vast supplies of human and physical capital, and innovative skills, which should continue to propel the economy to new heights.

  • World Bank President James Wolfensohn says world economic growth will be 1% or less in 2002. Speaking on a British Broadcasting Corp. program, Wolfensohn also said the West needs to devote more time to the issue of helping developing nations to bolster world security.

  • Overall spending for online advertising is expected to fall 16% to $5.5 billion in 2001 from the 2000 level. Web advertising represents 2.4% of total ad spending across all media, according to estimates published in early October by Lehman Brothers analyst Holly Becker.

  • Trade exchange owners looking for an easy way to motivate their client base and stimulate more trade activity among their clients can obtain a copy of the 15-year-old, proven, informational marketing tool--The Competitive Edge newsletter. E-mail bmeyer@barternews.com for a sample copy and details. (Be sure to include your complete mailing address in your e-mail...this is not an e-mail newsletter.)

  • Dallas-based TM Century, a company that creates, produces and distributes music-based products for broadcast media use, has sent out a press release informing the world that effective immediately it would begin bartering for all TM Century products in all domestic markets.

    The company announced that for the first time in their history they will accept barter for jingles, which have historically been a "cash in advance" business. Additionally all TM Century products will now be available (sold) on barter including music services, production and imaging libraries, and commercial jingle production.

 

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