The Christmas shopping season is about to begin, and the executives at Wal-Mart, Target, Amazon, Best Buy, J.C. Penny, Sears, Macy’s, and hundreds of other big retailers are ready to offer us all bargains that are absolutely irresistible, even in these tough times. You won’t see this, or anything like it, in Moscow or Beijing or anywhere else. It’s the magic of free-market capitalism. Yes, it has its flaws, but no one in all recorded history has ever found a better system for distributing wealth. You offer customers a better deal, you win; you don’t, you lose. Over the next month, we’ll see a lot of deals, and we’ll vote with our wallets.
This year there’s a different spin: The customers are hurting, but the retailers are hurting, too. In a nearby mall (see my blog “Overmalled”) the latest casualty is Lowe’s. That closure follows the shuttering of Old Navy, Chili’s, TGI Friday’s, and Linens and Things. It’s only a matter of time before other stores in that unneeded mall throw in the towel. So there will be signs of desperation in the sale prices. Sony and Panasonic have already cut back TV production under withering competition from Korea, and the pressure will be on to slash TV inventories.
Some say the national sport is baseball; some say it’s football. I say it’s shopping, and my guess is that, recession or no, this will be a barnburner of a Christmas season. The retailers’ bottom lines may not look pretty (free shipping costs money), but their top lines will look fabulous.
Will a robust Christmas season kick-start the economy? It’s possible. Pessimism about the economic outlook is sky-high right now, and a jolt of good news might be just the tonic we need.