One of the reasons California’s economy is generally more volatile than the rest of the nation is that, on average, the people that live here are much more comfortable with leverage. And when things turn down, they more easily end up on their asses. I know an awful lot of people who live $300K/year lifestyles on $150K/year (and double those numbers). It just seems to be part and parcel of the California Lifestyle. Not for everyone, of course, but for many.
I see a lot of women that make less than $60K/year with $1000 Louis Vuitton handbags. While there are a lot of well-heeled folks in San Diego (and elsewhere), the Louis Vuittons of the world can’t survive on selling solely to the folks who can actually afford their products. There’s too much competition for the wealthy’s dollars. It’s from the people who cannot afford their products that the real profits are generated. Oh how I do love consumerism. 🙂
