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Michelle Holmes

October 31 , 2016

Ghosts and Goblins of Inflation

Ghosts and Goblins of Inflation

The tradition of Halloween originated in the Celtic holiday of Samhain. The Samhain holiday celebrated the end of the harvest season and the beginning of winter. The Celtics believed this transition was also a bridge to the world of the dead. The modern version of Halloween is more about community-based celebrations, costumes and candy and less about actual ghosts and goblins.

 

As the children dress in costumes and prepare to gather a feast of candy, retail companies are looking  beyond Halloween to the Christmas holiday shopping season. Traditionally the holiday shopping season kicks off with Black Friday shopping the day after Thanksgiving, but stores are preparing for the holiday shopping season now. Christmas sections are popping up in stores all over the area.

 

Many retailers earn a large portion of their profits during the holiday shopping season. Companies rely on the consumer to spend more each holiday season. In fact, consumer spending still accounts for the majority of the economic growth in the U.S. So how are consumers doing this year?

 

Consumer spending climbed in the month of September, up 0.5% after declining 0.1% in August. However, disposable income (income after inflation and taxes) was flat the last two months. Inflation acts as a counter to increased wages. As inflation rises, the things we purchase go up in price, which in turn means less money for consumers to spend on things that are not necessities. In order for consumers to increase spending, employment growth and higher wages for those already employed must grow faster than inflation. This means more people working with more money in their pockets to spend.

 

Companies are hopeful the inflation “goblins” do not eat into the holiday shopping season profits.

 

If you want to learn more about inflation or consumer spending, give Security National Bank a call today.

 

Happy Halloween!

 

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