Deleveraging times

Since the end of 2008, American consumers have started to “deleveraging” massively in the way they spend money and consume goods or services. As I have said before, this movement is unprecedented and is the beginning of great worldwide income equalization trend. I like to say that when a worker makes $2 an hour assembling a VW Jetta in China and his counterpart makes upwards of $20 in Germany, something has to give, and we'll be starting to see the beginning of income decline in our so-called developed countries.

That process is likely to be protracted as well as extremely painful and may last a couple of decades, but my sense is that it has now just begun and marketers as well as economists should begin to recognize it instead of running forward to rosier scenarios. Things are going to change drastically folks, and those who will be ready to accept that momentous shift may have a huge advantage and seize some good opportunities. In a next blog, we'll try to explore what these can be, so stay tuned...