Press "Enter" to skip to content

Spending Outpaces Sentiment; Personal Debt Down

Preliminary data suggest that holiday spending at brick-and-mortar stores is rather mellow, in part because shoppers already found a lot of the deals they wanted in earlier fall sales. But we are spending record amounts online, with Black Friday posting $9.8 billion in online sales, up 7.5% from last year. And consumer spending has been stronger than predicted throughout this year.

Such buoyant expenditures seem to run counter to sagging consumer sentiment, but columnist John Tsitrian says we should look at what shoppers do, not what they say:

…When I was making markets (1978-1990) at the Chicago Board Options Exchange, my competitors and I on the trading floor typically shrugged off sentiment numbers when they were reported. They were considered pretty much irrelevant as reads for the state or direction of the economy.

It was behavior numbers that mattered, and one of the most reliable set of numbers were those that produced hard evidence of where and how much consumers were actually spending [John Tsitrian, “So Far Consumers Are Defying GOP Gloom-and-Doom About the Economy. Holiday Shoppers Are Buying Like Crazy,” South Dakota Standard, 2023.11.27].

Part of me still wants to contend that we’d all be better off if we all bought a lot less stuff, but as we know quite vividly from the scary pre-stimulus days of the pandemic, everyone getting off the “Consume, Citizen!” treadmill at once will crash the economy. One reason Tsitrian says shoppers will still outspend their bad vibes is lower personal debt:

Here are some findings from a Northwestern Mutual Life/Harris Poll study conducted last Spring and published last August: On average, Americans are in substantially less personal debt (debt that does not include mortgages) than they were in 2022. In fact, average personal debt this year is $8,000 lower than it was in 2019.

This is why, as I noted earlier, the NRF says that “overall household finances remain in good shape and will continue to support the consumer’s ability to spend” [Tsitrian, 2023.11.27].

Talk is cheap, and so are Motorola flip phones and DeWalt drills. Keep consuming and charging it, citizens!


  1. O 2023-11-27 09:05

    Unfortunately, what they say is the indication of how happy they are with the administration — again in defiance of the facts. The Right’s misery campaign continues — even when the Democrats help to relieve that misery.

  2. Mike Lee Zitterich 2023-11-27 11:33

    IF people only buy online, then do not get mad when wages drop locally, by not supporting small businesses. Pretty disturbed by the amount of things people buy online, its sad, and it will have a divestating effect on our local economy. I think it is funny how people are willing to pay Uber or Lyft or Door Dash $10 dollars to go pick up their food at fast food stores, or other stores, paying MORE money rather than save their money to go the store themselves. I will never understand this wackadoodle economy led by a bunch of homebodies.

  3. O 2023-11-27 15:01

    The “Walmart-ification” of the US is real. Not only have employers pressured wages downward, businesses such as WalMart and Dollar Stores have made cheap goods available to workers so that there feels to be less pressure on spending limits from wages (driving out competitors). That is what is responsible for this downward or wages without the revolt that should accompany that spiral. However, those cheap goods have also applied downward pressure on wages and suppliers. The good of the economy or the nation is not a concern for these profit mega-corporations. There was a time that corporations could only exist IF they established they were needed for a public good. We must go back to that thinking to save this nation, its workers, and its consumers from the vampirism of capitalism. The current business cycle is a downward spiral. Income inequality proves this spiral.

  4. Donald Pay 2023-11-27 15:54

    I think the debt situation depends on a lot of things. Tsitrian is reporting average numbers, but we are all not average. I think its a bifurcated public. The better off will spend. The lower middle class are going to pinch pennies.

    The people who paid off debt during the pandemic probably are doing fine and can spend. These may be the settle middle class and upper middle class. Data show that younger folks and lower income people are pinched more by debt. Some reluctance to spend in the younger folks is student debt, which now has to be paid as the pandemic pause was lifted. Some of the increased debt pinch in the younger folks is buying stuff and doing things after the pandemic that they couldn’t during the pandemic. I think they went on a bit of a spending binge and are now pulling back.

  5. John Tsitrian 2023-11-27 17:30

    Given the macro nature of the discussion, I was comfortable using averages, Don.

  6. Todd Epp 2023-11-27 19:14

    Black Friday now begins on the 4th of July.

  7. ABC 2023-11-28 00:56

    You can face down Walmart and Walmart will blink!

    It’s only a 500 billion dollar in sales corporation. You have 35 trillion body cells in your human body. Why are you afraid of Walmart?

    You are a Divine Light! Just a few of us, and the whole thing will change! Be a leader!

Comments are closed.