The state of the economy in California has reached the doldrums so much so that our current level of overall prime loan delinquency has gone up to over 4 % which is higher than the delinquency rate of the economic slumps in the early 1980s and the early 1990s. Do you see a pattern here? I don’t.

It’s very difficult to try and theorize on the what causes these temporary crashes in the world economy, and how it affects the California economic landscape, but one thing is for sure – we are facing hard times.

The Jobless Rate In California

The jobless rate has been creeping up past 8 % recently and the value of homes has decreased over 35 % from their highest level. This all adds up to a worsening trend in California and going forward in to 2009. There are some financial experts that believe banks and lenders will be declining loans at a near-historic rate in 2009.

This is rough news, and it’s not fun writing about the grim realities we are facing, but I would like to shed some “pragmatic light” on the woes of the California economy. Here are some of the positive points worth highlighting so you can enjoy your Christmas season and New Year festivities.

The Film Industry in California

One of the most durable industries is the film business. In hard times the movie making companies tend to thrive as millions of people around the world seek escape in front of the big screen or their family TV sets. The #1 source for all major film productions is in Hollywood. I know many locals are sick to death the film business in California, but let’s face it – IT’S GREAT FOR OUR ECONOMY!

The Toursim Industry in California

Tourism will always be a huge source of income for California as tourists flock to our warm state for entertainment and a break from the cold. Yes, tourism will be hit by a global and national economic crisis but it will never grind to a halt (or anything close). There are millions of families around the world (such as Canada, Germany, and Switzerland to name a few) that have bullish portfolios and money in their coffers to spend on travel, and California is one of their prime destinations. So be “nice” and treat our tourists like gold.

The Economy is Always Temporary

The economy is always temporary. No matter where you live (in California, the United States at large, or anywhere in the world) the economy is an ever-changing dynamic perception. What we see today is changing and changing fast. If the economy was slow-moving global entity then day-traders would not exist stock brokers would have low-stress jobs.

Whatever our current financial woes may be, it’s changing right now as you read this. In some places it’s improving and in some places it’s getting worse. This is way of the global economy and always has been. Better times are coming. Hold on to your hat and try to enjoy the ride.

I know you will be reading and hearing reports of a gloomy forecast for the California economy as the new year rolls on into 2009 but you must stick to your guns, make smart decisions, and keep a positive attitude regarding your own plans to weather the financial storms that might blow your way.

If you end up being amongst the unlucky who are badly affected by the 2009 economy here in California, remember that you are not alone (we’re never alone) and make sure your family understands the realities regarding your family budget. You need to work together as team to cut costs on “items of want” and “items of need”, such as clothing, food, and loan payments.

Try not to borrow money unless you really have to – I mean REALLY have to. This ugly economy will blow over and better days are on the horizon. Most economic experts agree that this recession will only last until early 2010, so hang in there!

Merry Christmas to all!

Celia
CLF Contributor