There are still eleven days to go before the official holiday season kicks off on "Black Friday," and yet, the lobby of my office here in midtown New York is already festooned with gleaming Christmas decorations. It's the kind of indicator that my co-host Jeff Macke and I find ourselves contemplating as we continuously try to assess various inputs in order to assemble a holiday forecast.
To be sure, the lateness of Thanksgiving has shortened the traditional shopping season by a week, or 25%, which will probably make things more hectic, but not more expensive. At the same time, we've had a number of mixed signals coming in lately that, if taken in isolation, could be used to argue one way or the other that Christmas 2013 is going to be a boom or bust.
As Macke and I debate in the attached video, if you were to take these snippets of sentiment and dump them all into a huge proverbial blender, what would the ensuing Christmas Cocktail be like?
The first ingredients that Macke pours in, so to speak, are a recent Gallop poll (which declared that shoppers say they plan to spend 10% less this year) followed by a shot of hard evidence which shows a million people actually rushed out to buy the new Sony PS4.
"It's as discretionary as a dog sweater," Macke roars about the frenzy of people willing to drop $500 to $800 on Sony's (SNE) new gaming system. "No one on earth needs a PS4. They just want one."
It's certainly not the kind of indicator, or ingredient, that would sour the brew and suggest the vaunted U.S. consumer is going into hiding.
At the same, we not only had offsetting earnings reports from two of the most Christmas-leveraged businesses on earth (Macy's and Walmart), but we found ourselves in a game of brinkmanship, as to which retailed dared to open its stores earliest on Thanksgving afternoon.
For its part, the National Retail Federation calls this Turkeyday shopping trend "a new tradition" that is being embraced by more and more people. In fact, they say 35 million people ate then shopped last year, and millions more will likely do so this year. Love it or hate, "Black Friday Eve" appears to be here to stay. For the record, the NRF predicts sales will increase by 3.9% this year.
We would be remiss if we failed to add in simple sentiment and confidence barometers, as well as a climatic report, given the fast-fading memory of our dysfunctional government. If that's not enough to top-off our holiday hopper, investors would be wise to acknowledge the improved "wealth effect," which reflects households being in a better money mood due to record-high stocks and an improving real estate market.
And finally, if you garnish the whole thing off with the recent slump in gasoline prices, you can't help but want to refill your cup 'o Christmas cocktail, maybe even more than once.
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