Recession ahead, drive carefully

From today’s Telegraph

Forget inflation and the manufacturing figures. Stop looking at the latest existing home sales figures or the data on non-farm payrolls. One of the most accurate indicators of an imminent recession is in and Americans should start tightening their belts.

Winnebago, maker of the famous recreational vehicles, expects its first drop in sales in six years

Winnebago, the makers of the famous recreational vehicles so prominent on the highways of the US, is expected to post a decline in sales this year for the first time in six years. Buying a motor home is seen as the ultimate discretionary item, and over the past three decades, declines have always heralded a rapid slowdown in the US economy.

“Recreational vehicles are at the swing end of discretionary spending because no-one needs an RV, and certainly no-one needs a new RV,” said fund manager Ron Muhlenkamp, who began selling Winnebago shares last year.

As the US housing slump continues, petrol prices head above $3-a-gallon once more and consumer confidence takes a nosedive, sales of motor homes, along with other typical discretionary items such as Harley Davidson motorcycles and plastic surgery, are forecast to fall…

Helpful information: The model shown is a 2008 Damon Tuscany 4055. Yours for $231,070 on the road. Cash in that sub-prime mortgage now.