The Bottom Line

A Holly Jolly Christmas?

Volume I Issue X – Monday, December 5, 2005

A monthly newsletter of financial commentary for our friends

 We would like to turn our attention today to a topic we have been discussing at length on our radio call in segment (which you can catch on 101.5fm at 4:30 P.M. on Mondays). Tourism is a segment of the economy that was pronounced all but doomed in the wake of 9-11. We have seen airline after airline filing for bankruptcy protection, mergers in the world of resorts, and the hurricanes haven’t helped matters. I heard the first bit of good news out of that industry just a few weeks ago. United Airlines is hiring 2,000 new employees. Did I say hiring? Surely there must be some mistake. That’s right, folks – the beleaguered airline is finally moving a direction besides South. Another interesting nugget: Did you know that within our very own city is the 8th most visited tourist attraction in the state of Tennessee ? Casey Jones Village brought 770,000 visitors to the hub city in 2004. I would bet that those people spent money elsewhere in Jackson as well. My point is that the tourism industry has been on the ropes. In some instances it has been beaten black and blue. But I remember that it seemed when Rocky was the bloodiest, he was at his best. When any industry gets beaten up, leaner meaner businesses emerge. It’s all part of that continuous business cycle – and maybe, just maybe tourism is perking up.

 $2 seems to be our new standard for now in gasoline world. We have been judging gas as “a little over two dollars.” Or occasionally I hear “I paid under two dollars for gas today.” This may be where we will set up shop for a while. Most of the panic has died down, supply is plentiful, and no hurricanes are bearing down on the gulf (that I know of). Oil will not be quite so prevalent in the headlines as we transition to colder temperatures. Headline (and water cooler talk for that matter) will be about how high utility bills are this month. We felt the pinch when gas was high, and we’ll feel a pinch when the weather gets cold – the question is how much? The utility companies have done a good job preparing us, but there is nothing like the shock of that first bill from a cold month. From the big picture, energy costs are still a huge issue. We can only hope that this will fuel an “efficiency race” for companies to create energy efficient inventions – from cars to refrigerators. That’s the best we can hope for – along with the hope that speculators will begin to exit the energy arena and move on to greener pastures.

 What are you getting for Christmas this year? Electronics are certainly a hot item. Best Buy seems like the place to be when it comes to gadgets this Christmas (BBY stock is up 16% since the holiday shopping season began). Are you spending as much this year as last? The numbers we see indicate the average family will spend just a hair more than what they did last year, still a little bit sore from gas prices – but not sore enough to make a huge difference. Time will tell if this will be a Wimpy Skimpy Holiday , or a Holly Jolly Christmas. Even though it’s Christmas, retailers are certainly hoping for more green, than red (at least on their income statements).

 May God’s Grace be with you as we celebrate together the greatest gift we could ever receive – Jesus the Christ.

Chad P. Wilson, CFP

Financial Consultant –Investment Professionals located at Foundation Bank- 731-554-2423
Not FDIC Insured – No Bank Guarantee – May lose value