UNC Economist Optimistic About Holiday Spending
Posted November 21, 2001 2:48 a.m. EST
CHAPEL HILL, N.C. — A big question remains for economists and retailers alike: What will consumer spending be like this holiday season?
The Friday after Thanksgiving is typically one of the busiest shopping days of the year. This year, some experts are predicting that a lot of people will stay away from stores. A leading economist in the Triangle said the opposite is true.
UNC economist James Smith has built a career on being right.
"I have been right more often than any other available forecaster for the last 12 years," he said.
This year, Smith is going against the popular belief that America is in a recession.
article polled 49 economists; only Smith and two other economists said that the U.S. is
in a recession. Smith believes consumer spending backs up his prediction.
"For example, it's the best month for motor vehicle sales in the history of the United States," he said.
Smith said that this year's record-breaking housing sales is another indicator.
"There's never been a recession in the history of the United States with a strong housing market, so if we're in a recession, it's the most unusual one ever," he said.
Highly-publicized layoffs by large companies dominate the media, but Smith said that small companies are doing well. He said that those companies account for half of the overall economy and are continuing to hire.
Smith predicted a "record-breaking shopping season this year."
Since Thanksgiving comes early, this will be the longest holiday shopping season since 1990. Telecheck Services predicted a 2 percent increase in sales over last year.