Domain Industry’s Prospects Colored by Local Economy — Views of

Domainers’ views of industry are shaped by what’s going on close to home.

I’ve noticed a lot of domainers writing regarding how the world is ending. They think the economy is going to continue tanking and this will continue to hurt the domain industry to the point of a doomsday.

Could it happen? Sure. I worry regarding the U.S. government’s debt, the threat of inflation, etc. But I also think your view of the world is shaped by your local economy.

Here in Texas, if it weren’t for the national media we wouldn’t realize something was wrong. Unemployment is up and so are foreclosures, but it’s nothing more than a typical recession. A friend just entered into a bidding war to buy a home. While car shopping this stretch, I noticed that many of the dealers were almost out of many of the cars I wanted.

The cover of this stretch’s Economist shows a washed up surfer carrying a beat up surfboard in California. In the background is a muscular swimmer carrying a jet ski over his head in Texas.

Many of the domainers who think the world is ending live in Florida and California, two states hit very hard by the recession. This is mostly due to extreme excesses during the past ten years and poor government policy.

Of course, it also matters how you placed your bets this decade. If you bet on massive portfolios of long tail domain names and selling to other investors, you’re hurting more than the firms that have focused on end user sales.

What do you think? Does the local economy color your view of where the domain name market is headed?