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CNN Live At Daybreak

Will Consumer Holiday Shopping Trends Boost Economy?

Aired November 26, 2001 - 05:53   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CATHERINE CALLAWAY, CNN ANCHOR: Well retailers are banking on consumers to help boost this sagging economy this holiday season. And the shopping trends set this Thanksgiving weekend will help determine whether consumers are still leery.

Here is CNN's Brian Palmer with more on the tricky business of forecasting consumer spending.

(BEGIN VIDEOTAPE)

BRIAN PALMER, CNN CORRESPONDENT (voice-over): This holiday shopping season is unique and some say vital for the economy. In these first few days, some shoppers say they're seeking bargains and a return to normal. Others say they're being patriotic.

Have you done holiday shopping yet?

UNIDENTIFIED FEMALE: And I wasn't planning on it. We spent a lot of money.

PALMER: For retailers, there was some good news and some bad news about post-Thanksgiving shopping. Sales were up slightly compared to last year, but there were fewer shoppers in the nation's mall.

Retail sales are up but mall traffic is down. What does that mean?

KURT BARNARD, RETAIL ANALYST: Yes, but you have to remember retail sales are up only by about 2.5 percent on a same store basis and that is exactly the rate of inflation. So basically, we're ending up with nothing. There's no improvement over last year.

PALMER: It's the sagging economy, say analysts like Kurt Barnard. Last year, retail sales were stronger after Thanksgiving, stronger than this year, leading some analysts to predict a banner year for retailers. That didn't happen. Instead, many consumers decided to tighten their belts. This year could bring more of the same.

Sam McKinnon (ph) says he'll spend 30 percent less.

SAM MCKINNON: All in all, we have to see how the economy goes. I have three kids to feed and a wife and got to hold your pennies now and see what happens.

PALMER: To boost traffic, some stores are running sales and selling off inventory.

BARNARD: Very seldom before have consumers been able to access bargains like the kind they are being able to access now.

PALMER: So far, house wares, toys and computer games have been top sellers. While some may be inclined to save, others have an entirely different philosophy.

UNIDENTIFIED FEMALE: Well people are saying the economy is down, then we'll just help it out by doing our fair share of shopping.

PALMER: And perhaps even more than their fair share.

Brian Palmer, CNN, New York.

(END VIDEOTAPE)

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