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Thursday, October 22, 2009

Spending Surge -- Credit Payday, the Weekend, Jobs, or the DOW?

We saw a definite surge in consumer spending over the weekend -- with our three-day rolling average of Americans' self-reported daily spending hitting the triple-digits for only the second time this year. Keep in mind, we ask Americans how much money they spent "yesterday," so Sunday's $100 figure reflects money spent on Saturday. But we're already down to nearly half of that.

So the key question is -- when does spending surge, albeit briefly? We know spending is highest on the weekends and lower in the first few days of the week. In this week's Gallup Economic Weekly, our Chief Economist Dennis Jacobe discusses last week's numbers in relation to both improved jobs numbers and the recent uptick in the DOW. He also discusses the potential impact of holidays and paydays and will explore Americans' spending patterns further in our lead story tomorrow morning. (Update: Read the full story.)

One key gauge of whether Americans are really ready to spend are their Christmas spending projections. So far, Americans' estimates for how much they'll spend this holiday season are down from last October, but up from last November and December. We'll ask this question again in November and December -- to see how estimates move as the holiday gets closer. What Americans ultimately spend is, of course, of critical importance to the nation's retailers and, in turn, the economy.

The reality at the moment is that while economic confidence has improved compared to earlier this year and last year, a majority of Americans still see the economy"getting worse." We've long been reporting a "new normal" where Americans, despite feeling better about the economy overall, seem resistant to get back to spending at the pace they were in the past. Each of the economic trends Gallup monitors provides a behavioral economic gauge of the true economic realities of the here and now. That is -- not whether it makes sense to get back to spending, but whether real Americans are actually doing it.

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