European Stars and Stripes (Newspaper) - October 30, 1990, Darmstadt, Hesse                                A morning after in . Economy on hold by Bob Webster United press International prices Are rising. Employment is falling. The . Economy is stalling and talk of recession taints conversations coast to coast. The economic fear haunting much of the United states has Given Many americans the jitters. Some people have altered spending plans already by Squir reling away Cash. Others have tossed credit cards in drawers. The traditional test of consumer spending Power a the Christmas buying season a looms on the horizon. Retailers Are feeling the Pinch already. Americans largest department stores have reported soft sales for september. The government reported an Overall gain of 1.1 percent in retail sales during the month. Much of this gain however came from the typically Strong september automobile sales including a a fleets sales to car rental companies and other Large car buyers. Despite the optimistic sales report consumer Confidence has dropped to its lowest Levels since the recession of 1982, according to the conference Board which commissions a monthly Survey of 5,000 households throughout the United states. The Board s report also shows that people Are less positive about the availability of jobs. Few economists disagree that the Economy has slowed considerably but the economic evidence is mixed As to whether the country has slipped into recession. Quot we done to know where the Economy is going Quot said Martin Feldstein president of the National Bureau of economic research a group of seven academic economists that determines whether the Economy is in recession. But you Don t have to be an economic theorist to know that times Are getting tougher. Just look at these headlines from one Issue of the new York times business Section a Citicorp earnings drop 38 percent Quot a two airlines to raise fares again Quot Quot Douglas aircraft cutting 1,200 jobs Quot "300 Are Laid off at Burger King Quot Quot Gold prices plummet again Quot Quot Dollar in record Low against  the next Day Quot earnings at Amr fell 52.1 percent in third Quarter Quot Quot Citicorp expects Large Job  Quot Texas instruments cuts 450 workers Quot Quot Dollar plunges against  news like this is enough to spook even the most hardened veterans on the economic Battlefield. Quot a sense of crisis is building Quot said former Federal Reserve chairman Paul Volcker Quot recession or not we re not growing and sluggishness brings unhappiness Quot a people Are very pessimistic Quot agreed Robert Oberst a certified financial planner from red Bank n.j., and president elect of the International association of financial planners. Oberst should know. When times Are Tough people tend to turn to financial planners for help Oberst said his business has picked up in recent months. Quot the bad news is the pessimism Quot he said. Quot the Good news is you can do something about  the Best thing people can do in times like these is to Paydown debt particularly from credit cards automobile Loans and other consumer debt Oberst said. Quot consolidation and Paydown is very important. That a going to help your Cash  for families trying to Roll with the economic punches the developments of the past few months notably the tension in the persian Gulf have turned thoughts of Belt tightening into an unwelcome reality. Quot things Are definitely tight a said Dan Buchanan an attorney from grand Terrace Calif. Quot personally id have to say we Are being very cautious about what we Are spending our Money on now Quot unlike some Young families the Buchanan enjoy the luxury of living on just one salary after deciding that Danes of done to have to be an economic theorist to know that times Are getting tougher wife Cindy could leave her Job to raise their two children. Quot if we have a major repair Bill it will really put a squeeze on things Quot Buchanan said. Quot and with a higher Job Market it might be harder for Cindy to re enter the workplace if she decides  that possibility has been heightened by the recent softening in the Southern California real estate Market which has slowed Billings at the Law firm where Buchanan is employed. The . Commerce department said the housing Industry suffered another miserable month in september As new construction fell 0.6 percent for a record eighth consecutive monthly decline. Applications for building permits an indication of future building activity dropped 4.2 percent. The grim picture of an Industry in deep recession was in line with forecasts by private economists who expect More weakness through the first part of 1991. And that s bad news for businesses such As Law firms that rely on the construction and real estate industries for Revenue. A people will pay their rent before they pay a doctor s or lawyer s Bill Quot Buchanan said. Worries about the Economy have altered the Holiday spending plans of Wendell Lucas an innkeeper from hot Springs a. Quot the Bottom line is i know we re not going to spend Tike we have in the past couple of years Quot said Lucas owner of the Vine cottage inn. Quot we May not be Able to buy four dresses each year for each of our two daughters. It might be two for each  Lucas said he is concentrating on paying Down Bills and trying to maintain his family a savings. Quot i certainly see no Way to save More  As a businessman Lucas has been hit hard by rising Oil prices. Since Iraq s aug. 2 invasion of Kuwait Lucas has had to pay twice As much for the 3,500 to 4,000 Gallons of heating Oil he needs to warm his inn. Quot we did t put the heat on last night if it had been last year we would have Quot he said. Quot we re watching the  economists believe fear of hard times ahead can quicken the Pace of the current economic downturn. But they caution that Quot bad vibes Quot alone Are not enough to stall the Economy. Quot in the end fundamentals will get you regardless of your attitude Quot said Robert Dederick chief economist at the Northern Trust co. Of Chicago. Quot really its the underlying situation that  but some economists Are concerned that consumer fear of recession May turn into a self fulfilling prophecy. Quot when people postpone spending plans because they Are concerned about layoffs orders go Down and layoffs eventually happen Quot said Cynthia Latta an economist at Dri Mcgraw Hill in Lexington mass. Businesses already have reacted to recessionary threats by boosting inventories a move that can signal production slowdowns which in turn prompt employers to Cut jobs. Although economists viewed August s 0.5 percent inventory gain As a sign of further economic weakness several said it was still not cause for alarm. Despite the boost in inventories Overall . Industrial production Rose in september by 0.2 percent mainly on increased output of cars trucks and parts the Federal Reserve said recently. But without the boost from the motor vehicle Industry production fell 0.1 percent during the month. Quot you can t expect the individual to take the attitude that i m of and you re of therefore the Economy is of and we re All going to go out and spend Quot Latta said. A a that a irrational but if they did that the Economy would t be As bad As i would be  economists say it also helps to remember that nothing lasts forever. That goes for economic Boom times As Well As hard times. There have been nine recessions since the end of world War ii including recessions in the mid-1970s and Early 1900s, according to the National Bureau of economic research. Page 16 the stars and stripes tuesday october 30,1990