Video Games - A Recession Proof Industry

Recession is that phase of economy where down trend is visible all through. Decline in demand coupled with fall of production and henceforth slowing down of gross domestic product. However one among those rare goods and services which are inelastic to market situations remains modern day version of entertainment irrespective of young or old which are computer games.

Though new kid on the block, games have witnessed many market uncertainties like 2008 which remained as one of a lean year, growth of this new market has been steady. Human nature draws them to any form of entertainment after a weary day and here games scores over a long list of many other means.

If we follow the data we analyze the growth of this industry. Study reveals that sales in US market has increased to around 38% which in absolute count may come round $8.27 billion in the first half of the year surpassing the $6.1 billion revenue of the year 2007. With revenue increasing in leaps and bounds and market share increasing in this pace definitely reveals the importance this industry holds. Infact the game industry as a whole is indifferent to recession can be figured out from the

fact that Technology bubble burst had least impact on it. While Dow Jones Industrial Average declined around 20% while video gaming revenue climbed 43%. After 2007, the industry sales moved up to 50% to all-time high, revenue registered around $18.85 billion. Around the globe, expected revenue exceeds $57 billion in 2008, 35% growth on one year time frame from the 2007 to a record $41.9 billion. With 267 million video games disappearing from stores, it means an average of nine games per second sold out of retail stores across the country last year& even faster in 2008, 40% up in the first half of the year itself. According to PricewaterhouseCoopers LLP global sales will hit $68.3 billion by 2012. That’s a 10.3% annual increase over the next four years.

A snapshot of the highest selling games in the last 12 months:-

Games	Release Dates	Copies Sold in Millions
1. Call of Duty 4	November 6 ,2007	10
2. Halo 3	September 23,2007	8
3. Grand Theft Auto 4	April 29,2008	6.5
4. Mario Kart	April 10,2008	6.5
5. SuperMario Galaxy	November 1,2007	6
6. Super Smash Bros	January 31,2008	5
7. Wii Fit	December 1,2007	5
8. Metal Gear Solid 4	June 12,2008	3

Cut off your Credit Card debts

A minimal effort can indeed save thousands of dollars every year . Credit card costs can be cut down also more cutting down of expenses means making more money. Certain measures that could be undertaken are:-

An interest exceeding 12% should be counted as excessive charging by the credit card company. The normal prime interest rates being less than 10% any credit card company who charges more than so are befooling you. If you carry a good credit then its best to find a good credit card having interest rates varying from 9 to 12 % avoiding those credit cards which charge 13 to 21% interest.
This can save about USD 450 to 1K a year.

A credit card having lower interest rate enables you to clear off the debts on other existing credit cards by cash withdrawals. Thus , the debt automatically moves on to a credit card having a lower interest rates. However , it should be noted that there are credit cards that charge a higher transfer fee to move a debt from one credit card to another. So it should be appropriately chosen.
This ensures a yearly savings of USD 200 to 500 a year.

A part of the savings should be used to clear off consumer debts. With credit cards charging interest at 10 to 21 % and a consequent less 1% interest offered by banks on passbook savings , it is advisable to clear off as many debts as possible through the savings accounts . However, it would be risky to empty the savings and be unprepared for emergencies. So an enough amount is to be kept along with a good borrower status.
This can provide a yearly savings of USD 200 to 500

If a person does not have enough savings to clear off his consumer debts then an alternative and viable option is home equity loan. As, home equity loans carry much lower interest rates than credit cards so it acts as a benefit in two ways:
1. The interest rates that you pay on your credit card at around 16% comes down to flat 6 or 7 % in case of the home equity loan.
2. the interest of the home equity loan can be deducted from a person’s taxable income.
However, it should be noted that it puts your house on the line so manage your funds very carefully.
It is possible to get a yearly savings of USD 1000 to 2000.

Look out for credit cards that come with no annual fees , considering other options as late payment fines, grace period ,interest rates and so on , choose your card. The cards that carry a fixed annual fee can also be made free by calling the concerned bank and asking them to waive off the fee.
It saves around USD 25 to 50 a year.

Always try to pay down the credit balance in order to cut down on the interest rates.
This can potentially save USD 100 to 1000 a year.

If there exists a balance on more than one credit cards then strategize your payments. Follow a Credit Crunch as follows :-
If card A charges maximum interest then pay the bulk of your savings towards card A while paying much lesser amounts to the others. Once card A is cleared then subsequently follow the same payment procedure for the card that charges the second highest interest rate after card A and so on.

Protect your finances from the hands of Natural Disasters

Natural catastrophes pulls away a person’s mind from his finances, when they strike. Thus, leaving a drastic aftermath for the rest of their futures. It is obvious that a person shall be least be bothered about his finances when such a tragedy strikes his family and home. It is even more tragic for people to bounce back from such a situation to normal life especially when his home is no more.

These lead to chaos and ample bad decisions in a person’s mind which even adds to the ruins of his future. Thus it is necessary for people to work out a plan ahead of time and be prepared for the worst. Since it is impossible to predict such catastrophes, it is best to set yourself up right from the beginning.

Certain advisable measures are:-

Gradually developing a fund for emergencies:

It is essential for every family to maintain an emergency fund constantly as easier access to money is a necessity during such situations. It is this emergency fund which avoids the hunt for funds when a natural calamity strikes.

Insure for storm damage:

It should be noted that a normal homeowner’s policy does not cover up the cost of the damages caused due to a natural disaster. So it is essential to get insured through an exclusive policy that will serve the purpose for a natural disaster. According to the nature of place where a person stays the appropriate policy should be chosen. Flood insurance, hurricane insurance are some of the alternatives as per the topography of the place of residence.

Index a list of contractors that you can bank upon:

During a natural disaster many home are destroyed or damaged. It is this phase when a homeowner helplessly approaches non-trusted contractors to put together a new place to stay for him. This is where con artists or new contractors come into the play charging huge amounts to gain unethically. Thus if a list of such contractors are kept who can be banked upon, then huge losses can be furthermore avoided.

Take care of your papers and keep them safe:

Your every financial document and paper should be copied and kept safely in some deposit box. Piling up a file with such documents and papers are not advisable. During such disasters if these are misplaced it gets chaotic to invoke your claims on the insurance policies. It is important that copies of all such documents should be also kept in a second location which shall be unaffected.

Thus, if the above mentioned precautions are taken before-hand it will obviously put you in a much better position than other victims. Though it is very tough for a person to actually think about losing everything that he might own , however natural disasters are unpredictably inevitable, so it is best advised to be prepared before–hand to lead a good life henceforth.