Happy families are all alike; every unhappy family is unhappy in its own way.” The opening sentence, from Leo Tolstoy’s “Anna Karenina,” may be about 19th century Russia, but it applies just as much to today’s recession-addled world. Weeks ago, most individuals in the Middle East looked “alike” in so far as they were reaping the benefits of a record oil windfall and impressive regional economic growth. But with a downturn now unfolding, many are now fighting personal financial battles.

There are as many of these stories as there are individuals. For some, living within their means over the years has helped them avoid unnecessary debt exposure. For others, a lifestyle propped up by credit is now taking its toll. Some of the most happening industries have shed excess fat and made people redundant. As the dust settles, austerity is becoming an important virtue. It’s difficult to say who is scaling back on what. But, by and large, changing circumstances seem to be hurting people across the board.

Those who are still buoyant deserve first mention. Elias Fayad belongs to the category of people who refused to participate in the web of consumerism that became synonymous with life in boomtowns such as Dubai. With that phase over, for now, Fayad is waiting for an opportunity to indulge.

“In terms of personal lifestyle, I am planning to travel more this year and benefit from bargains in hotels, airlines tickets as well as shopping,” says a boisterous Fayad, the director of Middle East & Indian Ocean at Danone. “As I avoided tying in my cash to overpriced real estate I am emerging with a better position to catch some bargains, and this will include buying a new car, trips to new places, and maybe buying some investment at a good price. Cash is king now.”

But even financially savvy Fayad would hope for things to get better. The downturn is beginning to manifest itself at a consumer level as the effects of the credit crunch kick in. Consumer confidence in the UAE, for instance, dropped by 3.4 index points in late 2008, its third consecutive decline in a year. A Bayt.com and YouGovSiraj research study says the dip follows continually waning levels of consumer confidence in the UAE throughout 2008. “The picture around the rest of the Gulf region was mixed. Bahrain and Qatar improved by 1.8 and 1.2 points respectively, while Saudi Arabia registered no change. Kuwait and Oman recorded a similar drop to the UAE, falling down the index by 3.3 and 3.4 points respectively,” the report said.

Nassim Ghrayeb, chief executive officer of YouGovSiraj, says although the indicator does not predict economic performance, it does provide a glimpse into how consumers are truly feeling. “The fact that the numbers have dropped in terms of willingness to spend suggests that consumers are exercising caution during this period of instability,” says Ghrayeb.

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