We're in the shit now. Beer no longer recession-proof.

People thought the video game industry was recession-proof. Well, they were wrong as shit about that one. Game studios have been closing down left and right and larger developers and publishers have been trimming jobs in the tunes of hundreds.

According to FiveThirtyEight.com, which gained national prominence for being incredibly accurate in its guess of the 2008 Presidential Election (actually being the most accurate to a nearly uncanny degree), beer sales are declining. Beyond just being very politically savvy, FiveThirtyEight.com obviously has good taste. As they ponder some of the reason's for the decline, they make note and mention of both ThreeFloyd's Alpha King and of famed Maryland brewery, Dogfish Head. And not just mention, but hotlinks as well. Huzzah! While I prefer ThreeFloyd's Robert The Bruce scotch ale, Alpha King is a damn good beer for any hop-lover.

Beer, it seems, is no longer what's for dinner.

The chart that follows details the quarterly change in alcohol purchased for home consumption, adjusted for inflation and dating all the way back to 1959. We can compare this against the quarterly change in real GDP:









As you can see, there has generally not been much of a relationship between alcohol purchases and changes in GDP -- the correlation is essentially zero. Nor have alcohol purchases historically been any kind of lagging or leading indicator.

But something was very, very different in the fourth quarter of 2008. Sales of alcohol for off-premises consumption were down by 9.3 percent from the previous quarter, according to the Commerce Department. This is absolutely unprecedented: the largest previous drop had been just 3.7 percent, between the third and fourth quarters of 1991.

Beer accounts for almost all of the decrease, with revenues off by almost 14 percent. Wine and spirits were much more stable, with sales volumes declining by 1.6 percent and 0.9 percent respectively.

Now, there are several plausible explanations for this. Alcohol sales -- but particularly beer -- had been on something of a hot streak prior to the 4Q, so perhaps there was some reversion to the mean. Perhaps people are substituting Michelob and Coors for more expensive microbrews like Alpha King and Dogfish Head. (This is unpatriotic, by the way, since all the macrobrews are now owned by foreign-based multinational conglomerates. Stimulate your country -- and your tastebuds!).

Perhaps retailers are discounting their prices, or brewers are passing along cost savings to their consumers (there had been a hops shortage for much of 2007-08). All of these are probably factors to some extent or another.

Nevertheless, it's absolutely startling to see a major consumer staple experience a sales decline like this.
- Source

FiveThiryEight also notes that both gambling and jewelry/watches are down too, but I couldn't care less about that. I don't wear jewelry nor watches, as the societal norm of wearing a watch on your left wrist feels awkward against my nerve-deadened scar (which basically feels like permanent local anaesthesia), and Virginia doesn't have gambling. And, no, the lotto doesn't count. I mean good, fun gambling, like blackjack and poker.