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Black Friday Shopping Like There Is No Tomorrow?

Zero Hedge [1]
Monday, November 28, 2011

By now the broader population has been inundated with reports of what a stunning retail experience Black Friday was. And for those who haven’t just head over to CNBC [2]: “Sales rose an estimated 6.6 percent to a record $11.4 billion on Black Friday, typically the busiest shopping day of the year for Americans, while the traffic at stores rose 5.1 percent, according to ShopperTrak. The day’s sales growth was the strongest percentage gain since 2007, when sales rose 8.3 percent on the day after Thanksgiving, said Ed Marcheselli, chief marketing officer at ShopperTrak, which monitors retail traffic.” This is happening despite the savings rate recently dropping to pre-Depressionary level [3], and despite revolving consumer credit (as in not cars and colleges), continuing to contract [4]. That there is more than enough fine print will be largely irrelevant for the mainstream media which will naturally trumpet this as the next best thing to the S&P actually rising for once: “More than 120 stores at the Mall of America opened at midnight. The crowd at that point was about 15,000 people. Mall operators estimated that it was the largest crowd ever at the mall, which is big enough to hold seven Yankee Stadiums. While eager shoppers emerged from stores around the country lugging big-screen TVs and bags full of video games and toys, it was far from certain that people will pull out their wallets for much more than the best deals this year. Shoppers with limited budgets started using layaway at chains such as Walmart as early as October. Retail shares fell more than the overall market on Friday. “Americans are still worried about jobs, still worried about the economy,” said Mike Thielmann, group executive vice president at J.C. Penney, who noted that shoppers were buying gifts and for themselves, and said jewelry was selling well.” Yet what really caught our attention was the Retail Group comparison of this “record” black Friday Weekend. From Bloomberg: ‘RETAIL GROUP SAYS SECOND-BEST BLACK FRIDAY WEEKEND WAS IN 2008.” As a reminder, Thanksgiving 2008 happened just after a nearly 400 point plunge in the S&P in two months as can be seen in the chart below. Which begs the question: with the world on the verge every single day once again, is it a coincidence that people spent more than they did only compared to 2008 when the world was once again ending. In other words, did Americans really spend “like there is no tomorrow” (more so than ever that is)… and what happens when the bill (because there is no doubt the purchasing was entirely on credit) is in the mailbox?

S&P heading into Thanksgiving 2008: must have done miracles for consumer confidence and desire to spend…


And for those who like comparative charting, is the action in 2008 predicting something very ugly for the immediate future, now that Joe Sixpack has spent themselves broke?


And some other indicative headlines from the Retail Federation courtesy of Bloomberg: