Your morning retail report

By Megan McArdle

I'm up in my mother's hometown for the holidays, a sleepy country village in western New York. Due to a sudden surplus of holiday iPods, we went to the outlet mall yesterday to pick out something else for my sister.

The place was eerily abandoned. Even Harry and David, which is normally crammed with shoppers stocking up for holiday parties, had more staff than shoppers.

The housewares stores seemed the most deserted, which makes sense: it's easier to make one's plates go another year than the ratty old sweater with a hole in it. I secured some fantastic bargains at the Mikasa store closing sale--four champagne flutes for $4, that sort of thing. I suspect anyone who retails china or pots is having a very grim Christmas indeed.

Western New York is already economically depressed of course, so your results may vary . . . but a friend found the same phenomenon in the Ohio malls, right down to the underemployed store clerks stalking her through the aisles. And nationally, it's been clear for a while that this Christmas season was bringing in some aggressive pricing policies; even Bose, which makes it a point of corporate policy to never discount, is "discounting" by offering freebies with its products.

I've been waiting for a recession to hit for over a year now, so perhaps I'm just suffering from confirmation bias, but I think it's pretty clear that consumers are massively retrenching. Since many retailers don't swing into profit until the fourth quarter, that sector, at least, probably qualifies for the r-word. As for the rest of us, I guess we'll have to see. But I'd say that P(Democrats win 2008 election) is solidly in the 95%+ range.

This article available online at:

http://www.theatlantic.com/business/archive/2007/12/your-morning-retail-report/2422/