Data for Thanksgiving weekend shows consumers shopped at encouraging levels, but underlying details about spending patterns suggest this may not have been the economic boon the administration believes.
According to Adobe Analytics, U.S. consumers spent $6.4 billion on Thanksgiving Day and $11.8 billion online on Black Friday, both record highs and up significantly compared to last year.
But Salesforce data, cited by Forbes, found that order volume fell by about 1% year over year, while average selling prices were up 7%—indicating that much of the growth was caused by inflation rather than any uptick in shopping enthusiasm.
…consumers shopped at encouraging levels…
I love the euphemism, but hate the system that makes it necessary.
Tracy Schuchart, a senior economist at NinjaTrader, called BNPL [Buy Now, Pay Later] the “elephant in the room” of consumer spending, noting high levels of usage among high earners for discretionary purchases and among lower-income groups for essential items.
PEOPLE SHOULDN’T NEED TO FINANCE ESSENTIAL ITEMS.
What’s the difference between the buy now pay later thing and regular credit card usage?
BNPL is generally for people who are too high a risk to put it on their normal credit card. It’s also normally configured to auto draft from the relevant bank making it hard to default on. Americans needing BNPL is an indication of the weakness of the economy.
Speaking as someone who does use the BNPL from time to time for discretionary spending: If you pay it in 4, then its 0% interest and a much smaller piece of your pay check.
Spending $25 over 4 pay checks is a lot easier to do than $100 all at once. But this only works if you A - Only have 1 BNPL plan going at a time, & B - Actually pay off your BNPL in 4.
I don’t have any personal experience, and the story doesn’t go into detail.
LOL… Like most things involving the economy they only see what they want to. If companies made things unaffordable for most people 364 days out of the year, but on the one day they didn’t, they’d say, “Look how great the economy is, people spent a record amount of money one day out of the year.”
So, creative accounting huh?
I’ve seen posts about buy now pay later services showing up on rent and utility sites. Creative must be a new word for ignoring the sinking ship.
We don’t have hoovervilles right now because most cities are hiding them or destroying them. The economy is effectively (increasingly) running on “off the books” credit while credit usage and defaults are running away.
If this were an old kung fu movie this is the part where you would hear “youre already dead”
