With the economy heading south and unemployment continuing to rise, consumers have been pulling back on their spending in order to have more money available for day to day necessities.  Certain areas of the economy are more susceptible to the downturn than others; and as spending has dried up, manufacturers and retailers in those segments have started offering big discounts to entice buyers. 

The Bureau of Economic Analysis recently identified a number of different areas where spending has fallen off.  If you’re in the market for goods in one of these areas, you can likely find some pretty good bargains.  They include:

• Autos – Almost all of the automakers are hurting at the moment; and many are offering large incentives in order to move inventory.  A friend of mine recently picked up a $17,000 Ford pickup for just over $10,000.  Not bad.
• Boats – Considered by many to be a leisure expenditure, boat makers are facing not only an economic downturn, but the end of the boating season as well. 
• Furniture – Many people tend to buy new furniture when they move into a new home; and with housing in the dumps, furniture makers are feeling the pain. 
• Appliances – Like furniture, appliance manufacturers aren’t moving as many products due to the slowdown in housing.  In fact, Whirlpool just announced that they plan to layoff 5,000 workers.
• Clothing – Apparel purchases are down close to 12%; and retailers have been running sales like mad to try and make up for the shortfall in revenue.
• Vacations – According to the conference board, the number of families with plans to vacation in the next 6 months has fallen by 10.4%.  As a result, a number of resorts, casinos, and airlines have begun to run promotions.
• Dining – Off by about 4%, dining has not dried up as much as some other sectors of the economy.  However, places like restaurant.com have been offering deeper discounts on a more frequent basis.
• Sporting Equipment – Like boats, sporting equipment is considered by many to be a leisure expenditure.  Spending in this area is off by 6%
• Jewelry – Spending is off by 5.3%.  And with gold prices down and the dollar quickly strengthening against the euro, it may be a great time to buy that fine watch or other jewelry that you’ve had your eye on.

Readers of Fiscal Zen probably know by now that I am a fan of Pandora.  By using a system that analyzes the various components of a song (melody, rhythm, vocals, etc.), Pandora is able to automatically pick out songs that you may enjoy listening to, based upon your preferences.

Over the years, I’ve amassed quite a collection of MP3s that I’ve ripped from my CD collection. And while I’ve used iTunes, Windows Media Player and others like WinAmp, they have always struck me as fairly basic and uninspired.

Last week, I downloaded iTunes 8 and have been playing with the new “Genius” feature.  Similar to the suggestion functionality available with Pandora, the Genius feature will automatically build a play-list from your existing music collection.  It does not appear to be as robust as Pandora, but seems to work well in its initial incarnation.   The biggest problem I have encountered is that it has issues with more obscure music.   That being said, I have been happy with the results so far, as it has allowed me to rediscover music that is already in my collection.

If you have the opportunity, check it out.

This weekend, I was looking for a copy of The Art of War when I stumbled across Project Gutenberg; which, it turns out, is quite a treasure trove if you like to read.

Project Gutenberg is a collection of over 25,000 free eBooks that have been compiled over time by thousands of volunteers since its inception in nearly 40 years ago.  While you won't find recent NY Times bestsellers, you will find many of the classics:  Pride and Prejudice, Ulysses, Alice's Adventures in Wonderland, and many more. 

So, if you enjoy reading, or need to find a classic text for a class, check it out!

As a kid, I used to enjoy making and flying paper airplanes, so I couldn’t help but smile when I happened across this compilation of hundreds of paper airplanes, models and origami plans.  Poking through the list, I found something for just about everyone:  flying airplanes, paper dolls, origami, cartoon characters, builds, boats, and more.  So, if you’re looking for something to keep the kids occupied on a rainy day, or feel like building a few yourself, go check it out!

• CBS News talks about where jobs can be found during the current downturn.
• Nouriel Roubini argues that the United States economy is at risk of imploding.
• The Motley Fool explains why current high yields make it a great time to consider buying dividend stocks.
• Gary Krakow argues that Netflix’s recent flubs create a real opportunity for Apple’s video product.
• CNN Money offers up 6 Fuel Sipping Alternatives to Hybrids.

And finally, Stephen Colbert explains why you should fear your iPhone:

Click to view the video after the jump...

At an average price of $2.49, ringtones have always been a big money-maker for cell phone service providers.  While during some research, I ran across a cool little site called Make Your Own Ringtones that allows you to create ringtones for free by uploading a song, selecting a clip, and then downloading the result.

Using an MP3 of History Repeating by the Propeller Heads, I created a short seven second ringtone in about 5 minutes and the results were pretty respectable.

Sound interesting?  Check it out here.

National Public Radio recently reported that people are turning to libraries during the downturn in order to use the computers and to save on book expenditures.  Rob Stevenson points out that there are lots of ways to save beyond books and computers.  Additional ways in which you can derive value from your local library include access to audiobooks, DVDs, magazines, and more. 

Sound interesting?  You can read the full article here.

Pets are wonderful additions to the family; but as they age, they can begin to experience health issues that require attention and treatment.  My wife and I recently experienced this when our dog was diagnosed with cancer.  While researching her illness, I ran across four free sites that offer information to help you care for your pets and keep them healthy.

They include:

1. PetEducation.com – Run by two vets, the website covers a range of health, nutrition, and care topics for common family pets.
2. Pet Place – A portal for dog and cat owners, the site includes a database of over 10,000 veterinarian-written articles.  The site also allows users to view and share photos and videos.
3. Petside – Similar to Pet Place, Petside is a portal for  lovers that includes a healthcare database of common dog and cat illnesses, as well as tips on how to care for your pet.
4. Webvet.com – A relative newcomer, Webvet just launched, but covers a number of healthcare and wellness topics for dogs, cats, birds, and other small pets.

With the economy in the doldrums and summer dragging on, here suggestions for ten frugal things you might consider for the upcoming weekend:

• Read a book:  Reading a great, inexpensive way to stimulate your mind, as it exercises several parts of the brain simultaneously.  Have you ever wanted to dig into a great novel by Steinbeck or Hemmingway?  Here’s your chance!
• Take a hike or go camping:  Head over to a nearby park or nature preserve to go get some exercise and fresh air.
• Cook:  And no, I am not suggesting that you pull out and prepare a box of Mac ‘n Cheese or Hamburger Helper.  Instead, stretch yourself and try making something new and different:  fresh artisan bread, pizza, or coq au vin, perhaps?
• Home Brewing:  If you enjoy beer or wine, then why not try brewing your own?  Admittedly, you will need to make a small up-front investment for the fermentor, carboy, and other supplies.  But once you have the necessary tools, home brewing can be a very cost-effective way of satisfying your adult beverage cravings.
• Find a swimming hole:  With the hottest part of summer now upon us, it’s a great time to head out to a local creek or lake for a refreshing dip.
• Hit the museum:  When was the last time you enjoyed your local art or science museum?  If you have got kids, children’s museums are a great way of keeping the kids entertained while learning.
• Play a game:  Pull out a board game or video game and enjoy some fun competition.  Like reading, gaming is a great, inexpensive way to exercise your mind while having fun.
• Visit a “Pick-Your-Own” Farm:  Instead of buying your fruits and veggies at the local grocery store, find a local farm that allows you to pick your own fresh produce.
• Volunteer:  Give back to the community by volunteering.  You can do so through your church or a local non-profit.
• Enjoy a Picnic:  Pack a lunch and head to a local park for some quality time outside.

In a previous article about travel tips, I mentioned that you can stretch your travel budget through currency arbitrage...the idea being that you choose a destination where the US dollar is relatively strong.  It turns out that you can leverage currency arbitrage in other ways, as well.  Main Street recently had an article where they profiled 10 nice wines that are available for $10 or less.

It's no surprise that many of their picks are from destinations where the dollar still has some strength: South Africa, Argentina, and Spain are well represented on the list.

Among their picks:

• Real Companhia Velha Porca de Murca 2005
• Adega Condes de Albarel Albarino Salneval 2006
• Gascon Don Miguel Malbec 2006
• Yalumba Y Series Viognier 2006

Venture over to Main Street if you want to see the full list...