‘Tis the season once again, but not just the season for hanging stockings and getting together with loved ones. It’s the season for shopping because manufacturers have successfully commercialized Christmas to the point where we even have special shopping holidays. Black Friday, Small Business Saturday, Cyber Monday… you get the drift. And according to the latest data from CNBC’s All-America Economic Survey, Americans have been doing a lot of it. So does that mean that our troubles are over and we’re ready to let the good times roll once again? Not really. People are definitely buying a lot of goods for the holidays, but they’re still feeling the inflationary pinch of Bidenomics so it’s costing them much more. And many of those purchases are going on credit cards. (NBC News)
It looks like it’s going to be both a green and a blue Christmas.
The CNBC All-America Economic Survey finds American views on the economy in a continued slump, echoed in increasingly negative views on President Joe Biden‘s job approval, and yet holiday spending plans are buoyant.
The survey shows intended holiday spending per person rocketed up to $1,300 this year, 31% above last year. While the number was driven by a small number of respondents saying they will spend large sums, the gains still amount to double digits when those answers are removed. What’s more, 18% say they will spend more, up from just 11% last year and the highest since 2019.
When asked why they were spending more, fully a quarter of respondents directly blamed inflation. A fair number of them (32%) said they were earning more than in the previous year, but those gains are not keeping up with rising prices. An even larger number, (37%) said they were actually spending less because of inflation. They’re just buying fewer gifts.
The economic analysis echos many mainstream media reporters who continually pretend to be puzzled by “the increasing divide between dour American economic sentiment and upbeat economic data.” Some of the data may appear “upbeat” to economists, but that doesn’t matter if the reality that greets customers when they go out to shop doesn’t live up to such hype. 80% of respondents in this survey rated the economy as “fair” or “poor.” Compare that to the same survey prior to the pandemic under the Trump administration when 53% said the economy was either “good” or “excellent.”
People are aware of when they have emptied out whatever savings they managed to scrape together. They know if they were compelled to cash in part of their retirement. They see the credit card bills that come in every month and which direction the balance is going as the interest rates rise. They don’t need a financial analyst on television to explain any of this to them. And they remember these things when they go out to purchase gifts for their loved ones, which most still feel obligated to do. But that doesn’t mean they have to feel happy about it.
Optimism is not gone from the country yet, however. This survey found that 24% said that they expect the economy to improve at least somewhat next year. That’s still a fairly low number, but it’s higher than the 19% who said that in October. Drawing the same comparison as we did above, in 2019, 54% said they expected the economy to be even better in 2020. (At least until the pandemic hit, of course.)
When it comes to the price of everything mentioned above, these interviews did reveal one shift. Previously the public was very concerned about the speed at which prices were rising. Now, far more people are concerned that even if the situation appears to be stabilizing, they are concerned that prices already rose in an unaffordable fashion and now they are failing to decrease significantly. In other words, they aren’t fearful that life will become unaffordable in the future. They are distressed that it already is.
So Christmas may be bright as the songs remind us, but not everyone’s mood is. The media is conducting a ham-handed sales pitch trying to convince everyone that things aren’t so bad because we’re heading into a heated election cycle where the current administration may be in a lot of trouble. While they remain fearful of the Bad Orange Man making a return next season, it sounds as if some of these poll respondents are engaging in some wistful wishing for a return to the “good old days” of 2019.
