The Struggling Student Rants—Spending to Save Our Lives

The Struggling Student Rants—Spending to Save Our Lives

A priest, a weed dealer, an AU student, and a grocery clerk walk out of a bar, go home, board up their windows and doors, and have drinks over Zoom.  Sounds like a bad joke but for better or for worse, it’s our new reality—and it’s here to stay.  For a while, anyway.

Every time I talk to friends and family, both across Canada and overseas, all I hear them say is, “I can’t wait until we’re back to normal.”  I’ve heard them say this since the end of February, even before the mass closures.  Now I ignore them and let them carry on—sometimes all folks need is to vent their frustrations.  However, being the cynical, worst-case-scenario pragmatist I am, for the first couple months I would proceed to explain, many times through the day and to multiple people, that we’re not getting back to normal and to adapt or risk survival.  In the words of Dorothy, from The Wizard of Oz, “Toto, I’ve a feeling we’re not in Kansas anymore.”

Anyone listening would then proceed to freak out about what would happen to their microeconomies, if everything did shut down, which we now all know it did.  Yet, despite the entire planet shutting down, my Greek-restaurant-owning family and all 300 cousins still consider my prior warnings anathema and praying, “We’ll all be back to normal soon.”  Any premonitions I’ve expressed have been met with resistance, a scoff, and a bottle of Windex to all surfaces.  No one I’ve talked to, three months ago or now, wants to face this head on; not even my old boss who introduced me to the world of risk management and business continuity.  He is, by far, the most pragmatic person I know but, to my disbelief, his response was, “Settle down cowboy!” and advised I was just being my usual, dramatic self.

The reality is the financial disruption—just like any disruption throughout history—came fast and furious.  Those that were prepared and did not ignore reality have not only survived, but profited.  But most people panicked and couldn’t think straight.  They not only invested their life savings in toilet paper, leaving us with nothing to wipe our butts with, but when the Bank of Canada slashed the interest rates to almost zero at the end of March to encourage consumer spending and keep the economy afloat, consumers didn’t react as the Bank of Canada expected.  Many families maxed out their credit cards, and even dipped into their savings, to stock up on groceries in the wake of the Apocalypse. 

It’s no secret that hundreds of thousands of Canadians lost their jobs, and with no income and ongoing payments and bills, they chose this method of payment to buy food items in bulk.  Heck, even I got carried away and bought three dozen cans of soups, beans, and stews all the while wondering if everybody else knew something I didn’t.  On the other hand, spending on dining and transportation dropped, since no one was going anywhere, which, in turn, affected all hospitality industries and the oil and gas industry.  Everyone thought consumers would spend less and save more, which is why the cut in interest rates.  However, it looks like this interest rate cut wasn’t even needed.  Consumer spending, despite the massive layoffs and business closures, didn’t decrease—it’s simply shifted en masse.  As with any behavioural shift, one thing is let go in pursuit of another.

RBC’s April 16, 2020 report, Pandemic News Delivers Consumption Shock, based on consumer spending, noted that grocery shopping went through the roof as anxious, panic-stricken households filled their pantries.  Yet, restaurant spending fell despite the curb-side takeout and delivery options.  Canadians also spent less on clothing and jewellery but, I know from various forums and sub-threads that consumers, including myself, willingly handed over their hard-earned cash on loungewear and DIY grooming items, like beard trimmers, teeth whitening devices, and pet grooming kits.

Software and data sales, on the other hand, saw the biggest growth in spending, since the majority of those still employed are working at home and those not employed are spending much more time online.  Most AU students were already adequately prepared for this, since we spend the majority of our learning life online anyway.

Finally, to no one’s surprise, spending on events, theatres, and galleries bottomed out by April since everything closed down.  This was countered by increased spending on books, music, and streaming subscriptions—even my mother who hates TV now has a Netflix subscription.

Our own family has been spending way more on home-improvement items, furniture, software, and hardware.  I obviously now need a faster, more reliable ISP provider to connect to work ($50/month increase) but suddenly my seven-year-old desktop, which was already on its dying breath, couldn’t keep up, resulting in a $1,500 expenditure.  And almost as if being taunted by the universe, two weeks later the new desktop is still in the mail and the old desktop woke up from the dead the minute I completed my online purchase.

We also now have the urge to clean up and repair every single slight imperfection we come across around the house, which we would have just ignored pre-COVID, because we were never home to even notice—ignorance is bliss after all.  But I’ve spent more on dish soap, hand soap, body wash, floor disinfectant, Vim® and Mr. Clean® Magic Erasers in three months than I’ve spent in two years.  I also now have the irresistible urge to order fancy $1,000 outdoor patio furniture, as well as hunt down all the planters and perennials in a 50 kilometre vicinity to enjoy in my backyard.  My spouse is still keeling over laughing.  Anyone that knows me, knows I am not outdoorsy whatsoever, abhor any creepy-crawly out there, and  I don’t even freaking garden!

Finally, despite my nonexistent cooking skills and ongoing Good Food™ and Hello Fresh™ subscriptions, I now find myself stocked up on massive amounts of flour and various accoutrements, ignoring the fact that neither am I able to track down yeast, nor can I bake to save my life.  I’ve also thought it prudent to get myself a spice rack and kit to store all 50 staple spices every chef should have in their pantry—according to Epicure™ and McCormick who have now shown me the way.  So to answer the Bank of Canada’s question as to whether we, as consumers, are spending less, my answer is a “hell no!”  I now have to learn to curb and control my newly-imposed spending methods to find a happy medium for my family’s wallet.  Until then, we’ll be eating well-spiced steaks on the BBQ, on our charming patio dining set, sitting behind a chain-linked fence next to Highway 403.