US Postal Service Reports Huge $1.9 Billion Second Quarter 2009 Loss


The U.S. Postal Service reported that despite actions to reduce its costs and increase its revenue, it sustained a net loss of $1.9 billion during the second quarter (January 1 - March 31 2009).

The economic recession, as well as other factors such as electronic alternatives to letter mail (alternatives such as e-mail, instant messaging, texting and the like), continue to reduce mail volume and revenues generated by the U.S.P.S., and it is likely the U.S.P.S. will face a huge cash shortfall at the end of its fiscal year.

A significant amount of the Postal Service losses can be attributed to an unprecedented downturn in mail volume, which declined 14.7 % when compared to the same period a year ago.

The U.S.P.S. has suffered net losses from operations in 10 of the last 11 fiscal quarters, so the second-quarter 2009 loss is not a surprise. But this quarter's loss is several orders of magnitude larger than its losses in the past.

US Postal Service Running Out of Money


The Associated Press is reporting that US Postmaster General John Potter told Congress that the US Postal Service will run out of money unless it gets some help this year from the US government. Potter has also asked to reduce delivery from six days a week to five days a week. His testimony was given at a Federal Workforce, Postal Service and District of Columbia subcommittee hearing on the financial stability of the Postal Service.

The USPS lost almost $3 billion last year and the PMG says it is looking at losing even more this year. According to Potter, if the reduced delivery schedule is approved, the USPS could save up to $3.5 billion each year.

It's hard to believe that cutting delivery by one day could save that much money. But we can think of even more ways the USPS could save: stop printing more than 100 different stamps each year (no country needs that many different stamps, and they're expensive to design and produce), stop advertising on television (that's expensive, and the USPS essentially has a monopoly over many of its services, so why bother advertising!), stop paying people to take surveys about current or proposed postal services and products (sure, I'd take one if they paid ME $10 to do so), stop giving away free boxes and other shipping supplies, and more. The USPS should get lean and mean, not bloated the way it is now, and has been for a long time.

Stamp Collecting is Booming




UK's Oxford Times reports, "...in these gloomy economic times, experts are suggesting stamps could be the answer and the stamps business is booming."



According to reporter Andrew Smith, some stamp dealers have never been busier. Andrew McGavin of UPA is quoted as saying “I have never seen the [stamp] market this firm. While I would not say stay it is recession-proof, there are some good returns.”



He believes there are three things that are keeping stamps popular as the economy suffers.



“Firstly, many stamp collectors tend to be aged over 60, meaning they are less likely to have a mortgage and be affected by day-to-day rises in the cost of living.



“Secondly, stamps tend to hold their value over the long-term. At the moment they are seen by collectors as an enjoyable hobby with profit potential.



“Finally, the Internet has been kind to stamp collecting. Demand is truly international and valuable stamps can be easily shipped worldwide.”