As we rapidly approach the end of the year, the century and the millennium, one thing is certain: We are ending 1999 with record vehicle sales that no one expected. All year long, forecasts have been rising. Fittingly, this year's U.S. sales will be a record for the century.
I guess that means that we'll have another 100 years before we have to break this year's sales record.
But here's an irony: One of the reasons business is so good is that business is so tough these days. We have very low inflation, low interest rates and almost no unemployment. Business is booming. But that's partly because costs are staying low and consumers aren't seeing price increases for anything. That is particularly true for automobiles, except for some luxury sport-utilities and a couple of other high-demand models. Car prices are staying pretty flat, and guess what? Consumers are responding by buying more cars and trucks than ever before. For just about everybody, volume is up and profitability is tough.
So, to paraphrase Dickens, it is the best of times, it is the worst of times. Still, it's a great way to end the year, the century and the millennium. And the most amazing thing is that there's no dark cloud on the horizon.
In the United States, we may have well changed from a traditional smokestack economy to a technology economy that doesn't include the recessions our forefathers and we had become used to seeing every few years.
In the new model, the highs of economic growth may not be as dramatic as in the past, but we may be able to avoid the horrible economic dives that everyone fears. In spite of a lot of self-fulfilling prophecies, there's still no recession in anyone's crystal ball. We certainly have a lot of folks to thank, especially the Federal Reserve. They may be chasing paper tigers, but it's working, so let's not complain.
The automobile industry still is the engine that drives the U.S. economy. And even with a modest decline in sales next year, we'll drive into the next century with a healthy demand for new cars and trucks. It's a great way to end this century, and an even better way to start the next century.