I’ve no need to venture off the proverbial “grounds” for coffee.
Over the years, I’ve accumulated every implement one could possibly need to make the most of one’s bean grounds: A french press, a Chemex, a high-end espresso machine (which almost never works), a stovetop espresso maker (which, like a revolver, always works), and a pantry stocked with three superfluous, cheap Mr. Coffee machines, for days when I’m not interested in anything at all fancy.
Sometimes, I feel bad about this situation. There is a locally-owned café just up the road that I used to frequent. Between my coffee brewmaster aspirations and unceremonious exit from the bar scene nearly five years ago, I’ve dealt the local services industry a small hit on aggregate, not to mention the grievous blow to my favorite bartenders, whose weekly tips were likely cut in half thanks to my inability to imbibe.
I haven’t conducted any formal surveys, but anecdotally, the local services scene essentially ceased to exist during the pandemic, even as other island life was generally unaffected.
I spend quite a bit of time discussing (lamenting) the fate of the services sector in the post-pandemic world, and as I was pondering what to lead with this weekend, I came across a chart from Bloomberg’s Sarah Ponczek, showing durable goods spending as a percentage of current PCE dollars. My version is below.
A couple of things stand out. Durable goods expenditures aren’t just experiencing a “V”-shaped recovery, they’ve gone parabolic. As a percentage of total personal consumption expenditures, we’re back to levels not seen in a decade.
As Ponczek mentions in her coverage, some of this is likely attributable to demand associated with the housing boom (bubble), which is itself at least partly the result of what some have characterized as an “urban exodus“. It’s also manifested in blockbuster comps for the likes of Home Depot and Lowe’s.
More broadly, it’s a symptom of a changing economy, where the services sector, driven in part by small businesses, still faces something of an existential crisis. Reproducing the visual above for services spending drives home the point.
That seems foreboding to me. Ponczek cites Srinivas Thiruvadanthai, director of research at the Jerome Levy Forecasting Center, who told Bloomberg Television that this shift is emblematic of the economy spawned by the pandemic — an economy that clearly benefits large companies over smaller ones.
Friday’s PCE data suggested the US consumer wasn’t totally tapped out in July, but it’s not a “V” yet (figure below).
In a services-based economy, it’s not ultimately possible to get back to “normal” without a complete recovery in spending on services — that’s tautological.
When you consider that many small businesses provide services, and that small employer firms (those with between 1 and 499 employees) account for 47.5% of the country’s private-sector workforce, you’re left with the distinct impression that the economic “shifts” illustrated in the first two visuals (above) aren’t consistent with longer-term economic prosperity in the US.
Besides, inherent in the concept of a “good” (especially a “durable” one) is the notion that one does not need to consume it every day, let alone multiple times per day, like a good cup of coffee.
I suppose I should start going back to the café. If everyone suddenly decides to be like me by purchasing the type of goods necessary to become one’s own service provider, there won’t be any cafés to go back to before long.
My condolences on the unceremonious exit from the local bar scene. Down here on the island you can’t walk into a Home Depot without it being packed. Locals despairing over the cost of lumber etc. Although new construction is tempered, existing homes are selling briskly. Within a range of course. Insofar as java is concerned I drink 3-4 cups a day. Thanks to Covid the bar scene is nonexistent.
An espresso machine, two French presses, a kcup machine, a nespresso maker, a kenmore coffee maker, a tassimo and a mocha pot are all in my current collection. Still my life does not feel complete. How do you like the Chemex?
I’ve always liked it. But I’ve cracked two of them. So it ends up being a recurring purchase
The only thing I have found in the last 5 years that improves the coffee is to add a few grains of salt to the grounds (odd as that sounds) .
Maybe I’ll try the Chemex- the quest continues.
During my misspent youth I worked on a tugboat in the Chicago area. Being low man on the totem pole it was my job to make coffee for my shift/watch. When being shown the coffee making ropes, I was told to add a pinch of salt.
I drank tea every AM for 25 years before my daughter gave me a really good grinder a couple of years ago. I got a french press I love and because I’m my grandfather’s GS and my father’s son I add 3-4T of milk and a tsp of dark chocolate to every cup of dark roast and tea is now just a memory.
The downtown areas that were decimated 20 years ago on the East Coast were transformed into restaurants ,cafes and boutiques and plenty of nail salons. It was easy enough to see happening. Gone hardware, thrift stores and antique stores and small grocery. The Malls 20 years ago were hot retail. Malls are in trouble now. Cities are in trouble. People have home gyms,offices, and learned to cook. You could not find flour in April. Baking,WOW.
Grind Sumatra(low-acid) to Turkish powder. 2 level tablespoons in large mug. Pour boiling water,stir wait 2 minutes.
If you can find Balinese coffee,even better. No macinery required,careful when you get to the bottom.
You guys are so techy, I still utilize a double-cup drip, add a little cocoa. Tastes great and keeps me regular, which is really all that matters.
Honestly, I think your response might be the best of all!
Do you make your coffee using distilled water?
Absolutely not. Of course, being in Detroit, our tap water is what’s in most peoples bottled water so I guess I’m a water snob by virtue of my place of birth-
https://www.theguardian.com/us-news/2020/apr/23/pepsi-coke-bottled-water-consumer-reports
I must be living in the past. The Nespresso machines serves me well, compact, no mess, minimal cleaning. More seriously, what is a blind spot is that we can observe the destruction but we need to read Schumpeter and open our eyes to how things are changing which can be additive instead of brooding on the negatives. The species adapts, it evolves, Perhaps a dose of optimism about the future is in short supply and a recognition that there are new businesses borne out of the pandemic or adrenaline shots to existing ones. How is it for Robinhood?
I have been wondering about New Business Formation and the character of it.
Frieling double walled french press- up front cost is pricey, but I have been using mine for 20plus years- never disappoints. I am lazy with Peets Major Dickasons. I like it strong!!
Amen to Peets Major Dickasons!
Also, and this is relevant, Specialties Bakery had four (?) locations here in Seattle. I believe it is a San Francisco based company. They feature Peet’s coffee from back in the day ( before Peet’s was gobbled up by a multinational ). Had… as in ( to paraphrase ) , ” after thirty three years Specialties is closing its business. The loss of revenue due to the Covid 19 crisis has forced us out of business”. A note tacked to one of its locations. They had excellent chocolate chip walnut cookies. I will miss them.
Heisenberg: Geek out on home made coffee supplies from this place up the road from me:
https://www.sweetmarias.com/
Green coffee beans, home roasting equipment. As well they roast their own expresso (never past Full City) in a German Probat roaster.
sweetmarias.com is the way to go…
As it is made clear by the inordinate number of comments and their focus on response to this post, we regular readers of the H report should keep the coffee industry alive and well during the pandemic…