Yesterday, I linked out to a Gallup poll which detailed self-reported average daily spending by income bracket. The poll showed wealthy Americans reporting a 14% fall in spend in November while middle- and lower-income Americans reported a 7% increase. The poll went on to detail spending across other demographics like age and geography. In toto consumer spending was reported as 20% lower than a year ago. For me, the interesting bit was the dichotomy in spend by the wealthy and everyone else.
Gallup concluded:
Still, consumer spending by both income groups continues to trail year-ago levels by 20%, even as those comparables have gotten easier to match — possibly dashing hopes that upscale retailers and big-ticket-item sales will do better this year.
Of course, this self-reported data is suspect, because we all know that consumer spending is not down 20% year-on-year. In fact, retail sales for November today came in better than anticipated. Moreover, consumer sentiment is up as well, according to the University of Michigan consumer confidence index. I see this as evidence that the holiday season may not be a bust after all, contrary to the results of the Gallup Poll.
CNBC did its own survey called the CNBC Wealth in America poll (the questions for which are here) and the results show a skew that is completely different from the Gallup poll, with the wealthy up 54% in ‘intended’ buying for the 2009 holiday season, while everyone else is down 15%. You can spin this however you want (trickle down will work or the rich get richer); these numbers are supportive of recovery for the near-term (and I stress near-term). I tend to see this – as Steve Liesman presents it below – as a tale of two cities. It was interesting to hear the way the other CNBC presenters question the numbers. It reminds me of the book Plutonomics and the term Plutonomy.
Below, CNBC discusses it on air. See the companion written piece linked below.
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