You'll see news outlets furiously try to persuade us that consumer spending was up for Xmas '09 over Xmas '08, but you can't argue with sales tax receipts.
And they were down 7.7% Dec '09 from Dec '08.
"Month to date tax receipts are now in for the entire month of December. They’re down 7.7% from December 2008, which is exactly the same rate of decline as November’s. We know that the TBAC and Treasury officials were not anticipating that in their debt sales forecast for the first quarter. They had assumed that a recovery was taking root and would continue to do so. That spells trouble for both bonds and stocks."
Contrast that with the Pollyanna NY Times:
"Despite a weak start to the holiday shopping season and snowstorms on historically big spending days, the nation’s retailers managed to have a better Christmas than in 2008, according to the latest data.
Mr. McNamara*, however, estimated that the retailing industry turned in a 1.7 percent sales increase in November and December compared with the period a year earlier."
Economists who actually saw the real estate bubble and coming crash have worse news for us:
"The recession is not over," said Michael Intriligator, professor of economics at the University of California, Los Angeles. He predicted economic output would not return to pre-crisis levels until 2013, while the job market would not fully recover until 2016.
[Joseph] Stiglitz^ said, what has so far emerged in terms of regulatory reform proposals is far too meek to have any effects. "The regulatory reforms on the table are totally inadequate," he said.
*Vice president for research and analysis at SpendingPulse, an information service of MasterCard Advisors.
^Joe Stiglitz was an economic advisor to Pres. Obama during his presidential campaign.