Thursday, December 10, 2009

The New Normal

Spending may not be where it was, but it looks like we are inching up ever so slightly with upper incomes leading the pack as would be expected. Apparently we are now in the "new normal".
You can see this Gallup research here: http://www.gallup.com/poll/124634/Upper-Income-Spending-Reverts-New-Normal.aspx They are not especially optimistic, saying this may be the look of things to come for some time.
For retailers, small businesses, and the companies that supply and support them, a new normal spending pattern can mean complex changes involving downscaling, upselling (people taking advantage to buy upscale for less), inventory management, and people-related adjustments. The U.S. economy is designed to allow the private sector to make such adjustments in order to optimize performance when faced with such a rapidly changing business environment. Of course, the same does not apply to maintaining the social safety net, particularly in the face of double-digit unemployment and even higher underemployment.

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