The Federal Reserve Board’s Beige Book report for December 2010 states the economy is improving. Market Watch reports the survey of all 12 Federal Reserve districts states the service sector has had a large effect on the improving economy. Auto sales were also a bright spot.
Other economic indicators seem to point toward an improving economy as well. CNN reports retail sales for the holiday shopping season are up, as a month’s worth of cheaper goods has spurred more spending. Companies such as Abercrombie & Fitch have enjoyed a 32 percent increase in sales versus this time last year.
Car sales rose 17 percent in November as compared to a year ago, marking a turnaround in the auto industry. It’s the second straight month car makers have reported significant gains in sales. Even though dealers haven’t offered as many incentives, consumers bought new cars to replace their older models.
The stock market soared on Dec. 1, taking in all the good economic news. The Los Angeles Times reports stocks were up nearly 250 points or 2.3 percent on Wednesday. It was the biggest percentage gain since Sept. 1. The rise came despite concerns over European debt.
With consumer spending seemingly on the rebound this holiday shopping season and more money is in the hands of consumers, the economic rebound seems to be moving forward much like the Federal Reserve Board indicates. What that means for average Americans can be several things.
I have been employed with the retail sector since I was a teenager in St. Louis. Sales have definitely picked up this year at the office supply store in which I am currently working. For me, that means more hours, a more stable work force, and perhaps extra bonuses and incentives after the holiday shopping season.
Gas prices have risen over the past week, and for my family that also means more money will be set aside for travel. We drive from Branson, Missouri, to Springfield at least twice a month. Plus we make trips to St. Louis about once every six months to visit family. We’ll likely pay more to make these trips, but we won’t curtail our travel unless gas gets above $3 a gallon here in Missouri. Right now, gas is about $2.70 per gallon.
For my family, adding 10 cents per gallon onto fuel bills will add about an extra 10 dollars in expenses. When gas prices go up, so does the price of national brands of food. We may start to spend more money on locally produced products should things such as milk, eggs and bread start to become more expensive.
Another good thing for my family is that prices of gifts for the holiday season are remarkably low. We’ve saved over $300 on our big-ticket items so far. As long as retailers are willing to offer lower prices, we’ll keep buying.
I can definitely say for certain my family’s economy is doing better right now. Hopefully that means the rest of the United States is getting a holiday boost as well. With so many things going right, the government and the economy can hopefully keep moving forward in 2011 to make the quality of life better in America after a tumultuous two-year plight.
Federal Reserve Board, “Beige Book–Summary–December 1, 2010.”
Robb, Greg, “U.S. economy showing signs of improvement: Beige Book,” Market Watch.
Kavilanz, Parija, “Hot deals juice up retailers’ holiday sales,” CNN.
Los Angeles Times, “Stock surge on economic data and relief in Europe.”