Record unemployment. Gas prices at over $3.50 a gallon. Housing market trashed.
Record breaking “Black Friday”?
I’m having a hard time with paying bills and keeping my kids fed and I’m doing well compared to some. I can’t afford to go shopping for tvs and tablets. Christmas is going to be a little light this year. How is everyone else doing it?
Heh. In my family we call it “going Scrooge” - when I talked to my parents last weekend the conversation went something like this:
Mom&Dad: “So, are we doing presents this year? What should we get?”
Me: “I don’t know - lots of med bills this year. I’m thinking of going Scrooge again like a few years ago”
Dad: “Yeah, good idea! Let’s all go Scrooge!”
I hope we get rid of the holidays altogether! Or at least do them alphabetically. You know, A-C will celebrate in January, D-F in February, etc. That should put The Locrians around June.
Think of the steady airline and presents sales! 
This year it’s even tighter for me, so I hope gift cards are appropriate.
During the depths of the great Depression, unemployment was 25%. Said another way, 3/4ths of people had a job. And probably 1/2-3/4ths of them were earning just as much as they did before the Depression started.
At least in the US, recession is much more a matter of some folks are screwed, most folks are completely unaffected, rather than everybody takes a minor hit.
If you’re one of the screwed ones, that makes it feel particularly unfair. And it is. But if you’re one of the large unaffected majority, it just means everything is on sale.
Part of what makes a recession is that the people who have money are afraid to spend it. There are large sectors of the economy that weren’t hit very hard. People with decent incomes are (justifiably) afraid that they might lose their jobs, so they stuff their money under the proverbial mattress rather than spend it. Even the people who don’t have much to worry about – doctors, software engineers at Google, people that are still relatively wealthy even after the market crashes – don’t spend as much money as they did before the recession.
The less-well-off, but not quite desperate, put more of their money into paying down debts, and spend less on consumer goods.
Once these people regain their confidence (they have comfortable savings, their debt under control, and the economy seems to be improving) they spend again.
People (or at least Americans with no memory of truly hard times) also can’t maintain a bunker mentality for long.
There are plenty of people who didn’t lose their job back in 2008 but who got scared in 2008. They held back throughout 2009 & part of 2010. When the big bad unemployment wolf seems to have passed them by, they (mostly) go back to old habits.
Their job is probably as much or more in jeopardy today & over the next 6 months as it was in 2009. But now that feels “normal.” So they go back to spending.
For lots of people, gifts are a way to rationalize spending: people don’t have $100 bucks to spend on themselves, but it’s okay if they spend (charge) $100 on someone else because that’s not selfish, it’s a gift. And then that other person does the same, but it’s also okay, because it’s a gift. So people get what they want without guilt. And then they feel helpless in the face of their debt, because they never spend any money on themselves, there is no where else to cut!
Other people are under tremendous social pressure to buy gifts, and not doing so would be unthinkable: to admit to being too poor for Christmas is really humiliating in some families and social circles, and in others is simply not believed: the assumption is that you are being cheap, and it’s taken as a lack of respect/affection and is a serious black mark.
Christmas may be good for the economy on a macro level, but it really screws up individuals. I am very grateful we don’t do Christmas gifts in my family, and haven’t since we were children. I shudder when I see how it often destroys a year of financial planning/recovery for people.