Those seeking good economic news in the week after Thanksgiving had to read down to the fine print.
Following the usual tradition of their trade by dramatically announcing what most folks had already figured out, the National Bureau of Economic Research — a private, nonprofit research organization — declared Monday that the U.S. economy has been in a recession since December 2007.
The gross domestic product turned negative in the July-September quarter of this year. So shouldn’t the beginning of the recessing be dated from this summer?
The NBER responds that its dating committee uses broader and more precise measures than the GDP, including employment data. In a news release, the group said its cycle dating committee held a telephone conference call on Friday and made the determination on when the recession began.
Meantime, the Commerce Department reported Monday that construction spending fell by a larger-than-expected 1.2 percent in October, while the Institute for Supply Management said its gauge of manufacturing activity dropped to a 26-year low in November.
On Wall Street, the Dow Jones industrial average, which has been imitating an amusement-park ride for weeks, responded by dropping nearly 700 points, giving up more than half of last week’s big gains. The Standard & Poor 500 index dropped nearly 9 percent.
Here in Nevada, Global Insight, an economic consulting firm hired by the state government, announced it does not foresee the Silver State economy recovering before 2010. The company on Monday projected Nevada will lose 48,400 jobs during 2009 and hit an unemployment rate of nearly 9 percent early in 2010 … before starting slowly to improve.
And now to the good news — such as it is. Preliminary figures released Saturday by ShopperTrak RCT, a research firm that tracks total retail sales at more than 50,000 outlets, showed that — compared to last year — retail sales rose 3 percent to $10.6 billion on the Friday after Thanksgiving, the traditional kickoff of the Christmas shopping season.
On the other hand, John Morris, an analyst at Wachovia Capital Markets, wrote in a note published Monday that while traffic and business were strong on “Black Friday” — so named because many retailers count on the day’s business to put them in the black for the year — that “strength did not carry through the remainder of the weekend as business fell off sharply on Saturday.”
Karen MacDonald, a spokeswoman at mall operator Taubman Centers Inc., similarly reported that weekend sales fizzled after a spike on Friday.
Retailers hope some of that business has merely shifted to their Web sites. On Monday, traffic at online retailer eBags.com was up 12 percent compared with the Monday after Thanksgiving last year and sales were up 10 percent as of 1 p.m., said co-founder Peter Cobb — about what he expected.
Internet research company comScore said Sunday that online spending on Thanksgiving Day and Friday was up 2 percent compared with a year ago. While slightly better than the flat growth comScore has predicted for the holidays, the increase is still drastically lower than the 19 percent growth last year, and total fall sales are still off last year’s marks.
Of course, while it’s understandable that retailers want to see new money flowing onto their balance sheets, the change that would really benefit the American economy would be an enhanced personal savings rate. So, are those holiday shoppers a) out spending cash that they’ve saved out of their paychecks, this year — or b) simply running up the credit cards again?
That wasn’t immediately clear. We’re almost afraid to ask.