The 2009 holiday season is fast approaching, and many American consumers are anxious to begin the shopping frenzy that can be almost cathartic for some. This year, however, consumers are likely to be accompanied by much more stress than in the previous two years, even though the 2007 and 2008 holiday seasons were two of the worst in history. Our national unemployment level is prepared to surpass 10% before the end of the year, so some investors have decided to invest instead of spend. Retailers have denounced this strategy by mimicking the government's claims of economic recovery, but at least one US economist believes that Americans' holiday spending budget is far too large already.
Joel Wadfogel is a professor of economics at Wharton, and he believes that the $70 billion that Americans spend every year must be reduced substantially if consumers ever want to see the light at the end of this economic tunnel. “Christmas...has givers shooting in the dark about what you like. To make matters worse, we do much of this spending with credit, going into hock using money we don’t yet have to buy things that recipients don’t really want.” Wadfogel has been called a Scrooge by some shoppers, but there are some savvy Americans who share his beliefs.
Some investors have decided to buy gold and take physical delivery of their metal. Many investors prefer to buy gold and take physical delivery because it provides an extra layer of security for unprotected portfolios. Physical gold and silver do not come with a flurry of bells and whistles, like so many toys and electronics that disappear from the shelves faster than the temp employees can restock them. Precious metals could depreciate over time, but many of our nation's shoppers subscribe to the idea that devalued precious metals are still a much better gifting option than a polka-dot tie, coffee mug, or word-of-the-day calendar.
Steven Martin
Senior Gold Specialist - Buy-Gold.org
