Holiday spending reached the highest level on record last year, but that news isn't as good as it sounds.
The $462 billion in holiday spending reported by a trade group on Friday handily tops the $453 billion peak reached in 2007, before the economy took a nosedive. Take a closer look, though, and you'll find these figures don't tell the whole story.
Just because Americans spent more this holiday season doesn't mean they bought more. That button-down shirt you bought your father in 2010 probably cost more than it would have three years ago. But the government figures on which the National Retail Federation bases its holiday sum do not take into account rising prices. Although inflation has been tame over the past few years, holiday spending would have had to clear $478 billion to signify spending was back to pre-recession levels.
That's not all.
The population of the U.S. has grown by 8 million people since the previous record was set. That means there were millions more shoppers in stores this Christmas, driving up the sales total. But the average spending per person is still lower than it was a few years ago, suggesting consumers are still slower to pull out their wallets.
So what your trying to tell us is that 16 billion dollars in consumer spending is the difference between looming depression and
ReplyDeletehappy days are here again?
Hell man - the fed prints that much chicken feed in a matter of not minutes; but seconds
And then gives it to Portugal
I mean AIG
Umn - no I mean Ireland
or was that Caterpillar ? Mcdonalds ?
No No It was Goldman ! That's right - it was
GM
LOL
People charging up more debt on their credit cards does not a healthy economy make .... we are fucked in 2011 .... store water, food, ammo.
ReplyDeleteYeah ... no shit on both above ! We give Gm 50 billion friggin' dollars and they take a new engine plant offshore, give every employee left a 5,000.00 bonus and stick us with the bill and now this yokel wants us to believe that 16 billion is somehow supposed to make a difference?
ReplyDeleteStock up baby ! She's not far off now!
The true US GDP is 30% lower than official figures .See
ReplyDeletehttp://www.leap2020.eu/The-true-US-GDP-is-30-lower-than-official-figures_a5732.html
quotes:
The United States’ entry into the austerity phase actually started at least two years ago. In fact, the crisis and its consequences in terms of a collapse in earnings and capital, as well as the drastic restriction of consumer credit, are only one step in the process of the impoverishment of the US middle classes which started nearly thirty years ago. Throughout the whole of this period, the frenzy of easy credit had the aim of hiding this impoverishment by compensating for a shortage of income with unlimited debt.
…However, this attempt has a direct impact on US GDP that most economists and experts refuse to acknowledge because they would be a shock of such violence for global economic and financial stability that the so-called « Greek crisis » would look like a simple training exercise. If the Greek authorities’ lie over the amount of the country’s debt and thus the debt/ GDP ratio was able to generate worldwide panic, imagine for one second the discovery that the GDP of the United States is actually 30% lower than the official figures and, therefore, the ratio of public debt/ US GDP in 2009 was 113% and not 83% (1) will cause (because for our team it is a reality that will become obvious during 2011). The difference is simply due to the fact that between 2007 and 2009, the United States took on board more than 4 trillion USD of extra debt for an increase of only just over 200 billion USD in three years (2)….
… But make no mistake! This huge additional public debt is only an attempt to substitute to a « missing » GDP due to the crisis and the end of consumer debt. One could also defend the idea that that this 30% has been nothing more than a fiction of GDP for at least one or two decades.
But our problem is not what happened twenty years ago, but what will happen in the future.