Strip business in decline - the anecdotal evidence

I don't visit enough different clubs to make a judgement one way or another, but the club I visit most frequently is located in Michigan, and yes, over the past year or so, things do seem to be slow. Granted, Michigan's economy is far from robust right now, so that could be the reason, but I think there are other factors also.

I was at the club last Friday night and the place was dead for a Friday. Not only a slim crowd for a Friday night, but the place lacked energy. No excitement. I made a comment to one of the veteran dancers that although the new girls here are OK, they really are not dancer material. I think the lure of "easy money" has enticed too many women into the business that are not really hot enough to be strippers and it has taken the toll with customers. They are tired of going into a strip club and seeing a certain percentage of dancers as "just ordinary". Don't get me wrong, there are still plenty of hotties, but I think the market has been flooded with too many average-looking dancers.

"They are tired of going into a strip club and seeing a certain percentage of dancers as "just ordinary"."

I cannot figured out whether BECAUSE of the slowdown, this problem is getting worse, or will eventually have the opposite effect down the road, as the less attractive girls are forced out of the business, and prettier girls (lacking opportunity elsewhere in the economy) enter the business

Of course my impression is the business itself for years has been staffed by a core group of girls in the 7 or 8 range -which by analysis would typically lets say be the pretty and cute (and perhaps personable girl from high school,) but one who would never win any major beauty contests. One in public that the average guy might notice, but he's not going to spin his head for

However I have to agree, not only are there girls that shouldn't be dancing, there are now a distinct lack of 9 and higher level girls

Yesterday in Club A there was quite a selection of dancers in the 6 to 8 range, with the ATF I was on the looks scale objectively an 8.5 range dancer (subjectively in an attrativeness scale with the accent and down to earth personality higher in my mind). Now with 20 girls working the floor and maybe 50 to 60 guys at that point with the club rapidly getting busier, my ATF had only managed one set (3) dances with one customer in 1.5 hours, and she was standing alone when I came in - having (as she always does)already worked the entire room

Now there were at least two 10 range girls in the room

The first has been "working" (she lounges in the corner most of the time) there 2 or 3 days a week for several years and was waiting for one of her HIGH ROLLER regulars, and that's 90% of entire business - just handling several deep pocket (RIL's I would guess) customers a week, so as usual she wasn't out asking for dances

The second girl, a stunning/head spinning model-like brunette (with augmentation) who flies in from another city 1500 miles away only hits the club once a month and when I was with her in VIP early last summer she(ludicrously) claimed to be routinely pulling in $3000 a night - yesterday I saw her unable to get a single dance in the 20 minutes I saw her working the floor. Saw her on stage for the first time, and she absolutely first rate. My impression is that she's a high level escort of some type, and she does the once-a-month thing to among other things dig up new clients. She happens to work at least part-time with a law firm, so my dance last summer ended up basically just talk

Club A yesterday had customers, just few spending, however I have to agree why should guys go to a club, if the girls are mostly just regular girls? They need more high level girls to draw people to the clubs, something out of the ordinary

That club yesterday was definitely loaded with ROCKS, clenching one of (the 2 min) required drinks tightly in their hand

The ATF at one point, (both of us looking at all these guys standing around with doing nothing but watching the stage) says to another dancer (from her same country) something in her native language; then she interprets it for me

Dancer "I just said, I hope they all get drunk so they will finally buy some dances"

Another comment on that 10 level brunette, she's an absolute no holds barred "wanna dance" type dancer, nothing phases her, she will go up to 15 different guys in a row and not be bothered that she might look like a fool.

Note only a small percentage of girls (as far as I know) in most clubs can stomach that much rejection at one time, but I guess being a 10 and knowing it (very different from an AFT 10 level I know from another club) - is how she handles it. My guess is also that the super large money offsets any issues she might have with that

Now of course as I just mentioned my ATF in Club A does the same thing, goes up to any guys to ask for a dance with no pre-sorting, and she was suggesting or inferring to me that she believed this 10 level girl had some special deal with the manager or owner that allowed her to parachute in like this to the club. This is probably more evidence that this 10 dancer is mixing stripping and high level escorting, maybe including some manager/owner escorting

I was thinking it would be nice if I had more time to analyze and watch all the strippers in strip clubs. I haven't noticed any decline in customers or any decline in the amount of people in strip clubs. I'm wondering though, I heard the carolinas were mostly unaffected by the housing mortgage problems. My house was only appreciating 2 to 3 percent a year and I heard lately prices are still going up in my local area. When I got a mortgage, they wanted proof of everything. About the only thing I didn't have to give was a blood or semen sample.

However I was wondering the other day, I wonder how many dancers got those adjustable rate mortgages and are in danger of losing their homes when rates readjust upwards. I heard some people will have to pay 1,500 more per month for their large homes in many parts of the country. A dancer would have to work a lot more to pay that. Maybe not in some places but around here I think so.

The federal government requiring proof of income would either cut dancers out of home ownership or make them pay taxes on their reported income. I can imagine many dancers won't be happy to learn about new laws being proposed or possibly already on their way to going in effect. However the banks probably have already imposed tougher lending standards.

Maybe customers aren't spending as much in the strip clubs and I just don't know. I heard discretionary spending on food and energy is taking a much bigger bite out of everyone's pocket.

The economists claim that for every dollar decrease in home equity, 9 cents in spending gets cut. Keep in mind that in New England prices have dropped about 10% overall and most think that is just the beginning

What's being hit first per the economists is discretionary luxury type spending mostly be middle and upper middle class - for example elective plastis surgery per recent data, has taken quite a hit, so its logical (although no hard numbers are in) that strip clubs being a luxury area are getting some of that same decline

"Stated income" loans which mostly started 10 to 15 yrs back were originally designed to provide loans typically to self employed (Sch C) type people, often in all cash type businesses and they usually required 30% down in cash. Now why the IRS never was interested in these borrowers I never understood, because it was obvious most were evading taxes. However that 30% was so large, that made the odds of default very low

Then for very odd reasons, lenders started letting stated income borrowers (among others) put little if anything down, then they added ARMs and teaser rates on top of this - and the results are now a disaster, however a good portion of the underlying creditors are in effect dollar heavy asian and other foreign based savers, who now in effect are having to buy up various american investment companies who are now taking major losses

Not sure how many strippers used these, but the ones that were marginal to begin wih are sure going to get hit

I heard some of the same news about discretionary spending getting cut in proportion to the percentage of home equity lost. If this is true, states and areas with the greatest home equity lost are getting hit the hardest. However I believe many people don't feel it yet if they aren't trying to move and/or have fixed rates for their mortgages. I certainly don't sense it if I keep hearing housing prices are still increasing in my local area. However if I lived in California and knew my house was devalued by about 200,000 dollars, I would be feeling a lot poorer.

California seems like an extreme example but I believe all the houses cost about 4 times as much as here in South Carolina at a minimum. I can imagine if you told someone in California, take only 25 percent of the perceived value of your house and that is what you can get it for in South Carolina, some might be in shock. Maybe with this mortgage crisis, the ratio is only 2 or 3 times after their house is devalued. Part of the big problem is when the value of your house is a lot less than what you still owe on the loan, there's a chance you might just default on the loan. If a bunch of people do this, the houses may get auctioned off and then the value of all the homes go down farther and farther. I think it helped me that I never thought of my home as a way to make a lot of money. I just thought of it as a place to live and stop throwing money away on rent so I bought a small one that was somewhat energy efficient.

California real estate is in an asinine condition. It's not a "market" as much as a "zone of confidence." What you get for what you pay for isn't as great, but everyone tries to tell each other that it is. Schools are better or worse, on the average, roughly equally; so too public facilities, roads, safety, working conditions, natural hazards, etc. Every place has its ups and downs. But California's real-estate buyers seem to think they don't.

alexa.com

This is a CityVibe.com internet traffic chart - which some (on the pink site) seem to believe is proof that things are getting tighter

In a lot of areas housing was overvalued because there were so many people rolling them over - buying them with no intention of living in them, but to resell them immediatly at an even higher price. When that kind of speculation becomes widespread, the bubble is bound to burst. So the decline in value isn't real because the values weren't real to start with.

In my area housing rpices have declined, especially at the high end, but they're still well above where they were 5 years ago. The only people who have lost any value are those who overpaid to start with or those who bought more house than they could afford with a variable rate mortgage and now can't roll it over because they don't earn enough.

If you look at house prices over a long period of time (eg. 20 years or so), they increase on average at 8-10 percent a year (in nominal terms), with considerable regional variation. But that increase isn't in a straight line, it's more like the stock market with significant ups and downs. It's always been like that and probably always will be because it's so interest rate sensitive. People who buy at a cyclical peak are always going to get burned.

In the short term it's a zero sum game, because they guy who sells the house at possilby a loss is contributing to the future gain of the guy who is buying it.

Two major trends which americans got used to - and now we are seeing the flip side

Over the past 5 to 10 years easy credit in the USA to a large degree financed by by asians awash in dollars - helped lead to one of the most spectacular real estate bubbles in history. Basically foreign savers investing in american consumption,

Another factor one might call the "The Greenspan explanation" which he's spoken about numerous times, but which also is positive overall - was the millions of productive manufacturing workers, technical, engineering etc dumped into the free world economy over the past 10 to 20 year by the unshackling of communism in the Soviet Union, eastern bloc countries, and China - all of which helped keep the cost of capital (i.e. interest rates) down

David, the real estate speculative bubble was strictly residential, primarily at the higher end of the single-family housing market; foreign ownership is primarily commercial, there hasn't been any speculative bubble there in nearly 20 years. The easy credit was created by the Fed in response to the weak economy that appeared during the last 2 years of the Clinton administration. Asians did play a role, but it was primarily due to their exports to the US which have kept inflation low, which in turn allowed the Fed to lower long-term interest rates to near historic lows.

No one mentioned commercial, the issue is obviously residential, something most of us were talking about being a bubble 3 to 4 yrs back, but which the major media today goes 24/7 with today - like its a breaking story.

The last few weeks have seen at least 3 major american investment firms being bought up, typically in the range of 10% of the market cap of such companies - and note the buyers: China (govt related entity), Singapore (govt related entity), and now Dubai - and reason is simple, asian and middle eastern (oil money) interests have been critically important in subsidizing american consumption via their willingness to (among other things) invest in recent years in CDO's dominated in u.s dollars, which are basically repackaged slices of mortgages supposedly covered by safe collateral - so they are now acting in effect as guarantors of last resort.

The Fed in fact had been upping interest rates for a number of years trying to unwind easy credit. The "Greenspan explanation" as I call it, is from comments Greenspan made on multiple occasion to help explain why interest rates and the cost of capital stayed low -despite what the Fed was or wasn't doing

David999 -- I "get" what you're saying but I frankly can't imagine that I'd be able to explain it myself. I just wonder HOW all those Asians GOT TO BE "awash in money" such that they were able to be set up as USA's guarantor of last resort in the first place. Seems to me that THAT is where the opportunity for learning how to be successful in the future would come, from these scenarios. Copy cat what they did back in the FIRST place ...

Your thoughts?

Living below one's means is really how the asians did it, after having first of course massively expanded manufacturing by among other things using huge quantities of engineers and techs (who's talents were mostly being wasted under communist style govts) and then mass amounts of low cost labor - much of it brought to the cities from the rural and farm areas which were becoming much more efficient when capitalist styled reforms began to be introduced (for example in china) over the last 10 to 20 years

Americans not only tend not to NOT want to live below their means, they tend to want to live above their means.

If you happen to read the book titled "The Millionaire Next Door" it turns out that aside from high earnings, living below one's means - is the central factor in gettting to those wealth levels, but people tend to not want to do that.

David, Asians didn't become wealthy by choosing to live below their means, most of them have little means to start with because wage rates are so low. They have the world's greatest income disparity - the rich are fabously wealthy while everyone else is poor. And the rich got that way by investing in manufacturing at home and exporting, mainly to the US (most European countries restrict their imports especially from Asia.) They have a huge economic advantage over western manufacturers not only because of extremely low wages but also because of the total lack of environmental regulations in the countries in which they operate. Now they're investing their money surpluses throughout the world - mainly expanding manufacturing in third world countries, buying real estate in the US. I'm convinced that Asia will dominate the world in the next century if not before, largely because their governments support manufacturing while ours does not, and manufacturing is the key to wealth and power.

"David, Asians didn't become wealthy by choosing to live below their means, most of them have little means to start with because wage rates are so low."

The question in fact asked by BookGuy was "I just wonder HOW all those Asians GOT TO BE "awash in money" such that they were able to be set up as USA's guarantor of last resort in the first place."

The actual question ASKED was clearly referring to the net aggregate savings of asians as a class.

The answer I gave is correct:

"Living below one's means is really how the asians did it, after having first of course massively expanded manufacturing by among other things using huge quantities of engineers and techs (who's talents were mostly being wasted under communist style govts) and then mass amounts of low cost labor - much of it brought to the cities from the rural and farm areas which were becoming much more efficient when capitalist styled reforms began to be introduced (for example in china) over the last 10 to 20 years"

In other words aggregate SAVINGS combined with efficient and low cost PRODUCTION supported by a talented (and previously underlized) labor force

Savings or consumption is a volitional choice, asians (as a class) tend to favor the first, americans tend to favor the second

"Rileyfeme" (Pink site, Hustle Hut, "No money anywhere" thread) posting from Buffalo 3 hours ago: and is generally consistent with what I am hearing from other dancers in various Northeast USA locales

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even the "no fee" doesnt save the night. The girls are getting worse, the guys are a nightmare, and the money is gone, gone, gone. In the 4 yrs ive been dancing (and before that i was a bartender in a strip club for 2 years) i look forward to the day after thanksgiving to the few days before new years. And it sucked. Nothing to look forward to anymore, damn it. Hell, ive been working a 7 hour shift @ one club then going to the other club and working another 7 hour shift, 2-3 times a week... with the only break being my drive there (however, it is a break from my dumbass boyfriend...lol). and the times i dont do a dble, i go in and work at least 8-9 hrs, the rest of the week. I'm getting f-ing bags under my eyes... im 26, f-ing sober bc im trying to get in law enforcem't and...well...you get it, and if it wasnt for my ADD medicine, id be passing out. WTF! still cant make it like i use to, and i was working 4 days a week ( and i mean day shift not night) for 7 hours...

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I think there's a simpler answer. Some Asians got fabulously wealthy by means of greater exploitation of a working class than would be legal in most of the developed West.

In reference to the "strip business in decline" issue, what's interesting is that generally its not a foot traffic issue per se, the clubs can be crowded (particularly pre-holiday last few weeks) but the spending is not happening at the levels people in the business would normally expect

For example, I stopped by a club late Saturday afternoon with 3 hours to go on the shift, and its a time I rarely happen to go by, and a very hard working and (formerly) big earning ATF I know had apparently left her shift early per discussions with her sister. This ATF dancer works 6 shifts a week plus and rarely ever throws in the towel, but today (despite a large crowd) - she apparently couldn't take it anymore

Her sister and her sister's friends, also dancers were stuffing their faces eating a very large meal right at their seats, apparently planning ahead for a long 2nd shift that night, to make up for low earnings on previous shifts

The club was very crowded in fact, however the guys in the club were probably 90% ROCKS or something very close. Now I admire ROCKS sometimes, because they can stick to a budget, however its another sign the patrons are holding back on spending.

"Some Asians got fabulously wealthy by means of greater exploitation of a working class than would be legal in most of the developed West."

way way too simple, as (among other things) it doesn't account for very high average IQs of certain asian groups, doesn't account for a well known work ethic or the historical propensity toward saving by these same groups, nor does it account for the huge amount of talent that was being held off the global marketplace by decades of failed communism -talent which then was unleashed

Someday there will be a billion personal computers operating in China, and one can only imagine the kind of productivity that might produce

Yeah, the level of commitment and productivity is also part of the equation. But I simply can't believe that the working situation is as restrictive as in the USA right now (not necessarily that I oppose human rights regulation, but that's a different issue).

In the case of China, there is no doubt their current environmental rules are not far from USA in the early 20th century - which for the most part was just dumping everything into the rivers

Good quote from daddy313 on this site in a post today

"nothing worse than a bunch of cheap horny bastard looking for a free show"

Reminded me when I was in a club recently, later in the afternoon and the parking lot is probably 3/4th full, which is alot of cars and alot for any afternoon at that club, so I expected the club to be really jumping -however when I entered the club it was only moderately busy, and except for a few girls on stage, there was almost no activity among the dancers, because the guys were not buying dances, instead they were ROCKS sitting stationary watching the entertaining stage show, with the dancers haven apparently made the rounds on these rocks, themselves basically becoming STRIPPER ROCKS

Book guy, you are on the right track. Some Asians got absolutely mind boggling wealthy by offering opportunity to other asians whose only alternative was subsistence farming, and offering to the western companies and consumers costs far below anything they could ever hope for. How and why is a more extensive topic.

To get back to the original topic, I don't think that the strip club business is in decline - seems to me there are more new clubs opening than old ones closing. What probably is in decline is average stripper incomes - the number of strippers is growing faster than the number of customers. So lots of strippers are having a hard time compared to the past but I'm not sure that clubs are.

David, I guess you missed my earlier point - income disparity increases savings and investment, which is why countries like China have so much more than we do. If you concentrate most of a country's income among a few people, much more of it will be saved and invested than in a country like ours where income is distributed much more widely. Years ago when our income was less widely distributed we had a high rate of savings and investment too. Our attempts to redistribute income through higher taxes on higher income people are a major reason why our savings and investment are so low.

The question of exploiting workers is an interesting one. Are workers better off being paid poorly (eg. so-called sweat shops) or to have no jobs at all? An interesting philosophical question. I once raised it on the Pink site and was vilified, which I found interesting - some people apparently don't like to ponder questions where the only possible answers are unpleasant, unfortunately that's often how life is.

AN -- where is the opportunity like that, nowadays? I want to live the parallel equivalent of what was done a half-generation ago by those Asians who "got mind bogglingly wealthy."

In some markets, opening new strip clubs is next to impossible, assuming you want "booze along with the broads" as Frank Sinatra might have said

No doubt the big decline (at this point) is in stripper income, the clubs have ways to mitigate damage over the near term at least. However in the case of a random club in a random market, I don't see how this is a dancer supply problem, when its obvious many customer are either spending less or not spending at all - except maybe for the 2 drink min.

Yes, there might be an overlapping dancer supply issue impacting individual dancer earnings, however it doesn't seem to be the main problem right now.

I don't think there will ever be a "dancer supply" problem, at least not for the foreseeable near future. Young women with few other prospects seem to be increasing daily in number.

Of course the "problem" (from the typical dancer's perspective) being discussed is one of an OVER supply of dancers, thus pushing earnings down. Many girls in fact are working extra optional shifts, to make up for poor earnings in their regular scheduled shifts -however the original cause of their reduced earnings seems more connected to customers spending less vs simply higher quantities of strippers in their clubs or other new clubs being added.

If the girls perceive there being an over-supply of dancers (too much competition) how do they explain the fact that the clubs in the New Orleans central clubbing area mostly cannot fill a full shift, not even on a weekend night? Oddly, it seems, every club can find three girls to work regularly; but not more, or less.

"how do they explain the fact that the clubs in the New Orleans central clubbing area mostly cannot fill a full shift"

The problem I'm continually hearing about pertains to customers spending either less or not spending at all. Except for maybe a few markets with low entry barriers to starting new clubs or expanding old ones, I don't see as an issue of being "the number of strippers ... growing faster than the number of customers" or a supply problem per se

In NOLa the pricing is almost entirely "high end." There are no lap-dance specials, a single rock song (3 minutes) often costs $50 or $60, and the usual arrangement is a private room for half an hour (always cut short) at $350. Each club charges about $10 or $12 for a mixed drink, $9 for a bottled beer, and as much as $30 cover. And yet the clubs can't find girls to work. And there are more and more new clubs, and old clubs closing and changing names and remodeling and becoming new clubs. If you go into most of these places you'll find three customers and three dancers. Or three dancers and, on the weekends, four customers. And eleven waitresses, seven sub-managers, two super-managers, a DJ, three extra DJ wanna-be's hauling audio cable around, some dude who knows how the light system works, and an alcoholic masquerading as a janitor.