Mario Cavolo

We wrap up our very enjoyable one month visit to the United States with a surprising variety of observations and conclusions. We have just traveled quite a diverse agenda including the New York area (all of Manhattan Island, Queens, Brooklyn, Yonkers, Bronxville) plus north into the beautiful Hudson River Valley, Phoenix including Northern Arizona; Sedona, Flagstaff & The Grand Canyon, plus Las Vegas and Los Angeles. I believe we are going to be able to share valuable insights with all of you in this series of articles in the coming weeks, including fascinating comparisons of the contrasting trends taking hold in the U.S. and China.

Let's start with one unmistakable fact: America Is ON SALE and that's a very, very good thing.

Whether it be the local grocery store like Albertson's or Safeway, Walmart, Target, or the upscale haunts like Macy's, Bloomingdale's and Nordstrom, not to mention the plethora of American retail brands, there's never been a better time to shop in America.

Generous promotional offers from 20 to 80% off blanket the stores and newspaper ads like the fields of sunflowers in July across the Italian landscape Sting wrote about in his smash hit Fields Of Gold. I was planning to load up on nutrition supplements and did so at 2 for 1 pricing. For example, I grabbed a four month supply of top brand joint support formula Osteo BiFlex triple strength glucosamine/chondroitin/msm/hyaluronic acid for only $40. We arrived at Border's books and snapped up a number of great books in the markdown section from $1 to $6 each instead of the normally outrageous $20 plus you would normally pay.

Now here's the other side of the news: I quickly noticed that stuff has gotten too expensive in the first place. Even at sale prices, even after the 20-50% decline in real estate prices, stuff in America is still way more expensive than it was when I officially relocated to Shanghai in the year 2000. From my point of view only coming to poke my head in the door from overseas every few years, the sale prices represent where the darned prices should be in the first place!

The 1600 sq ft home I purchased near McDowell Road at 87th street in South Scottsdale, a very nice development area, lists now AFTER the decline at around $170,000 USD. I had sold it in 1996 for $110,000 (that was with a custom pool in the yard) which equals $70 USD per square foot. So where's the bargain now? It's price had apparently gone all the up over $220,000 by 2007, a ridiculous amount to pay if you ask me. In the El Monte area of Los Angeles, very near the one million population Monterey Park/San Gabriel Chinatown area, the average suburban home is $300 to $500,000 dollars. Huh? Does that sound cheap or reasonable to you? Prices in Las Vegas and Florida and Phoenix for what we might call average, nice middle class homes are $100 to $150 per sq ft. (some lower bargains can be found closer to $80 per sq ft) That rate is equal to 7000 to 10,000rmb psqm meter here in China. Lots of slightly nicer homes are priced in the $200 USD psqft/14,000rmb psqm range AFTER this past year's decline in prices. Doesn't sound like a bargain to me anymore than the 15,000 psqm standard apartments we find in Shanghai. What's happening is NOT inflation, but a slow, nasty decline in the purchasing power of the world's currencies, mostly as a result of mounting debt due to our liberal government's insistence on sustaining economic initiatives and policies that are simply unsustainable. In the end, we all pay more and more, a phenomenon which is going to get even worse in the coming few years as the liberals continue their grossly overpriced reforms to supposedly save the country.

Sorry folks, the conclusion I reach is that prices never should have gone unreasonably high in the first place and I feel sorry for those folks who apparently paid upwards of $300-$1000 psqft/20-70,000rmb psqm for their home in the recent past. There are lots of reasons to consider that the drop in real estate prices has not hit bottom and will continue. Yes, the foreclosure and short sale listings are relative "bargains". In reality, damn well they should be.

Ditto for daily household products and restaurant prices...apparently America became a very expensive place to live during the past few years, yet I don't remember hearing much about a persistent nasty inflation pushing up prices in America observing from my bird's nest view here in China. It seemed to slowly sneak up on everyone, conspiratorially planned or otherwise.

The bottom line: America's middle class and lower middle class have been screwed over royally and that particular group of people is and will continue to experience a very uncomfortable decline in their quality of life, sinking deeper and deeper into the well-engineered socialist model that is being formed to rescue them by the same cronies that screwed them. Meanwhile, the Haves are doing just fine, spending and enjoying their American way capitalist spoils. I am certain the founding fathers are turning in their graves watching the shenanigans of the white collar thieves running the show.

The gap in American society between the Haves and Havenots has grown wider and wider, with less and less opportunity for the Havenots to cross back over. It appears the landscape of American society is undergoing a very nasty and ugly shift, NOT a broad economic decline, which is royally screwing a sector of somewhere between 20 to 50 million middle, lower middle and lower class Americans...all the while, the upper crusts are doing fine...believe me they are....I have this past month witnessed the streets of Manhattan, the strip of Las Vegas PACKED with people spending money, hotels booked, shows booked, valet lots FULL...where's THEIR recession? Clarification: many of these places are offering more aggressive promotions to make it happen. Therefore we can state that overall revenue levels ARE lower than a year ago. That is an acceptable point, simply recognizing the new normal of the economy. Prices WERE too high before and this correction to better value in the U.S. society is good for the general consumer. On the other hand, the way the banks and government just pulled the biggest and most shameless heist in history...well that's another story.

The positive point to appreciate in this article: America is ON SALE...hit the stores to take advantage of the most aggressive price promotions and incentives we've ever seen.

And by the way, what might any of this have to do with Sanya? Plenty, also of benefit to you the lover of tropical paradise in the form of substantial promotional discounts being offered by the many resorts located here.

I hope you will look forward to the continuation of this series. I welcome your comments for forum dialogue here on the site. I will NOT post excessively abusive, nasty posts overloaded with profanity, etc. Aggressive but intelligent please...Cheers, Mario

ne Month In America: A Series by Mario Cavolo
Part I. Ladies & Gentlemen, America Is ON SALE