On October 3, the National Retail Federation projected that "sales in the months of November and December" will "marginally increase 3.9 percent to $602.1 billion, over 2012’s actual 3.5 percent holiday season sales growth." But on October 16, it warned that "the average holiday shopper will spend $737.95 on gifts, décor, greeting cards and more, two percent less than the $752.24 they actually spent last year."
Anne D'Innocenzio at the Associated Press, aka the Administration's Press, in a report on the upcoming Christmas shopping season, chose to report the NRF's overall November-December increase, and ignored the obviously more relevant and more recent individual spending expectations. She also held off mentioning the elephant in the room — sharply reduced spending by Obamacare "sticker shock" victims and those who anticipate more of the same during 2014 — until the 19th of her 21 paragraphs (bolds are mine):
AMERICANS NOT WILLING TO SPEND WITHOUT DEALS
This holiday season, Americans may not spend their green unless they see more red.
Despite signs that the economy is improving, big store chains like Wal-Mart and Kohl's don't expect Americans to have much holiday shopping cheer unless they see bold, red signs that offer huge discounts. As a result, shoppers are seeing big sales events earlier and more often than in previous holiday seasons.
... So far, Wal-Mart, Target and Kohl's are among more than two dozen major chains that lowered their profit outlooks for either the quarter or the year. A big reason is the expectation that they'll have to offer huge discounts in order to get shoppers to spend.
... The tempered expectations, earlier discounting and lowered profit outlooks from retailers come even though there are indications that the economy is recovering. The job market is making strides. The housing market is starting to come back. And the stock market keeps hitting new highs. All that would ordinarily lead Americans to spend more.
But so far, those improvements haven't been enough to shore up consumer confidence. In fact, Americans' confidence in the economy is at its lowest level since April.
... Overall, The National Retail Federation expects retail sales to be up 3.9 percent to $602.1 billion during the last two months of the year. That's higher than last year's 3.5 percent growth, but below the 6 percent pace seen before the recession.
... Leslie Lynch, 52, said she won't be buying any holiday gifts because she was laid off from her job in marketing at an insurance company in August 2012 and hasn't been able to find a job since. Lynch, who lives with her wife who works in quality control at a machine shop, said she is behind in mortgage payments and is afraid she will lose her house.
"We will probably have dinner and that's about it," said Lynch, who lives in Glastonbury, Conn. "Hopefully, we will have Christmas next summer."
Though the effect of the shortened shopping season may be partially responsible, I can't recall a time in recent years when retailers' worries about the impact of deep discounting were as prominently voiced before Thanksgiving. So the report's observation that "shoppers are seeing big sales events earlier and more often than in previous holiday seasons" seems accurate to me. What isn't accurate, and is borne out by consumers' tight fists and retailers' deep discounts, are the report's contentions that the job and housing markets are improving by enough to matter.
In unexcerpted material, D'Innocenzio spent a paragraph on impact of the Social Security tax increase which occurred earlier this year when a temporary 2 percent cut in the tax expired. For a household with $50,000 in income, that's only $83 a month, and people have had a whole year to get used to it. The monthly Obamacare premium hits are much higher for those affected, and those who are feeling the impact are upper middle-income households who often splurge — or used to — on Christmas shopping.
Note that of the two individual shoppers D'Innocenzio used for her writeup, one was of a member of a same-sex couple in Connecticut. What are the odds of that? It would not be at all surprising if we learned that our intrepid AP reporter was just looking for an excuse to give the AP's related stylebook revision relating to how to characterize members of a same-sex couple a workout.
Looking at the bright side, the AP reporter at least let someone say "Christmas," which seems to be more than the U.S. Post Office is willing to do.
Cross-posted at BizzyBlog.com.
