Tuesday, November 27, 2012

Spoiling The Grinch's Christmas

As we noted on Monday, there are a whole lot of topics that deserve more attention than the non-scandal of Benghazi.

From the dishonesty some in Congress keep displaying about the 'fiscal cliff', to the Republican Party's civil war - including the battle for continued relevance by Grover Norquist -  to the continued attacks on and implementation of Obamacare, to the crafty and questionable decisions being made by the Supreme Court, nearly every direction we turned seemed to be haunted by negativity.

So, we did what many Americans were doing yesterday, and took a break to see what holiday deals were online and what holiday stories we might find. In retrospect, that may have been an even worse idea.

From stampedes by stupid 'Black Friday' shoppers, to shootings over parking spaces, to worries of holiday debt, our staff members felt like the Grinch himself had come to visit our computer screens - especially when articles like "5 tips to steer clear of debt in holiday shopping" or "Debt-free for the holidays: 6 steps to less stress" kept appearing.

The solution, of course, was to step back from our attempt to help a friend find Bert & Ernie dolls for a little tyke, and remember some key economic points about the holiday season.

As consumer credit giant Equifax pointed out early this month, total U.S. consumer debt actually fell in the third quarter, even as American consumers remained cautiously optimistic. In fact, as we've noted recently, the U.S. economic recovery appears to be picking up steam. As the recovery is gaining strength, the biggest share of debt for Americans - mortgage debt - has continued to shrink.

That isn't the case with non-mortgage debt, though - hence all the warnings.

Traditionally, the pattern is one that Americans have repeated many times. As the economy begins to recover, people feel like their own personal economy is better than it is - so instead of taking care of the mess they're still sitting in the middle of, they begin to spend again, beyond their means. As Annie Lowery pointed out in the New York Times recently, this time may be different, when it comes to U.S. consumer debt. Truthfully, there isn't enough economic data yet for economists - or journalists - to make any definitive claims about what our U.S. consumer debt levels reflect about the ongoing recovery.

With that in mind, we don't plan to play grinches ourselves this holiday season, so we'll only say this much: holidays aren't about the dollar value of the gifts. They're about the value of the thought you put into the gift. That may mean spending more time than money, or finding unusual methods of shopping - for example, searching E-bay with a pack of your friends to find old Bert & Ernie dolls at fair prices. The gift itself won't really be the dolls, but the time spent hunting as a group, which will bring you all closer together, even though you're separated by hundreds of miles.

What's even better about a gift of your time to a friend is that unlike going into severe debt, there won't be any strings attached.

We hope the holidays are good for the U.S. economy - and early signs say that's likely to be the case this year. That said, we also hope you stay smart, so the holidays are also good for your personal economy, in January, Februrary, and beyond.

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