Black Friday, the Fiscal Cliff and a Blue Christmas?Theodore Iacobuzio |
Are all those crowds on the news enjoying (and misbehaving on) Black Friday dancing on the edge of a volcano, or, rather, a cliff?
Not that there’s anything to complain about in the numbers coming back from Black Friday; though, as MasterCard’s Michael McNamara points out, the hype around “Cyber Monday” as a date is perhaps misplaced, since increasingly every day is cyber Monday, or Tuesday, or Saturday night (we’ll see the results of this year’s Monday classic soon enough).
The most trenchant commentary on all this is from the Washington Post’s Robert Samuelson, who adduces at least in part the larger economic recovery’s weakness to the Great Recession’s having “scared the wits out of most Americans.” They don’t look too scared in the video above, do they? At least not of the economy.
The question is, were they scared smart, or, less baldly, to any effect? Or is their exuberance over the last couple of days a function of their not paying attention?
The White House is paying attention, having just warned Congress that a buzz-cut in middle-class disposable income could effectively stifle the recovery, such as it is (see Samuelson).
Your agent’s best guess is that the U.S. consumer is well aware of what’s happening in Washington. But what we have referred to in this space as the remarkable resilience of the American consumer might just meet its match in the Fiscal Cliff (see chart). At the very least, bad or mixed signals coming out of the negotiating process might dampen some of the high spirits on view last week and weaken Christmas sales, even if the cliff is finally averted before the ball drops.
If I’m right, then consumers’ robust performance over the past couple of days is a reflection of their confidence that their elected representatives can be trusted to do the right thing.