From Darkness to Boom: A Holiday Shopping Journey
American consumers often express their gloomy moods in surprising ways.
For months, they’ve reported feeling that the economy is unstable and that they can’t afford to buy anything; in fact, they claim purchasing conditions are the worst they’ve ever experienced. Yet last weekend, they completely defied those sentiments by opening their wallets, shopping online, and flocking to malls.
The University of Michigan’s November Consumer Sentiment Survey paints a bleak picture. Sentiment has dropped to its lowest point since June 2022, with the Current Conditions Index hitting an all-time low. Particularly noteworthy is that purchases of large durable goods—like cars, electronics, and furniture—have reached the lowest levels recorded in the survey’s history.
Economists at Bank of America have identified a growing pessimism regarding personal finances, and affordability appears to be a pressing concern across the board. Both Democrats and Republicans share this negative outlook. Many low-income consumers feel “a lot worse about the economy.” The survey indicates that Americans perceive prices as too high, uncertainty as overwhelming, and the current situation as too volatile for making significant purchases.
So, you might wonder, how do these sentiments translate into action? Well, Americans went out and bought cars. Vehicle sales in November surged to a seasonally adjusted rate of 15.6 million units, increasing from 15.32 million in October. This was an uptick of 1.8% compared to the previous month. Surprisingly, this all took place during a time when consumers believed that buying conditions for durable goods had never been worse. While car sales are down compared to last year, this bounce-back doesn’t quite fit the narrative of a struggling household sector.
Money Speaks Louder Than Research
Thanksgiving weekend shopping data reinforces the idea that consumers are rebelling against their own pessimism. According to the National Retail Federation, a record-breaking 203 million shoppers visited stores during the five days from Thanksgiving to Cyber Monday. This figure surpasses last year’s count of 197 million and exceeds the previous record of 204 million set in 2023. Moreover, the number of shoppers exceeded NRF’s own projections by about 16 million.
These weren’t just casual browsers; a staggering 96% made holiday-related purchases, with an average spend of $337.86—up from $315.56 last year and the highest since 2019. Two-thirds of this spending went toward gifts.
Both brick-and-mortar and online sales saw increases. Physical stores attracted 129.5 million shoppers, which is a 3% rise from last year, while online shopping attendance jumped 9% to 134.9 million. Black Friday remains the biggest shopping day, drawing in 80.3 million people in stores and 85.7 million online. But the real spikes took place on days when shopping wasn’t expected. On Saturday, for instance, 62.7 million people shopped in-store and 63 million online. Foot traffic in stores on the Sunday after Thanksgiving rose by 27%, reaching a record 32.6 million shoppers.
Cyber Monday drew in 75.9 million online shoppers, up from 64.4 million the previous year, largely driven by mobile devices. In fact, 46.9 million consumers shopped via mobile, an increase from 40.4 million in 2024.
People purchased clothing and accessories (51% of shoppers), toys (32%), books and media (28%), and gift cards (26%). Notably, these are discretionary purchases rather than essentials for household survival amidst fears of inflation.
By the end of Thanksgiving weekend, 84% of consumers had started their holiday shopping, though I still had about half of mine left to do. The National Retail Federation forecasts that holiday spending will surpass $1 trillion for the first time, expecting growth of between 3.7% and 4.2% in 2024.
This trend isn’t new, yet it remains underappreciated. The consumer sentiment survey is increasingly disconnected from consumer behavior. What people express about the economy doesn’t always match how they actually spend their money.
Several factors contribute to this disconnect. Sentiment research captures emotional responses that are often swayed by media coverage, political divides, and general concerns about “the economy.” On the other hand, spending reflects individual circumstances.
This doesn’t imply that the economy is flawless or that genuine affordability issues don’t exist. Rather, it suggests that consumer sentiment surveys have proven to be a poor predictor of actual consumer behavior. Although Americans might tell pollsters they’re worried about high prices and bad purchasing conditions, they continue to buy.
This gap is significant because policymakers, investors, and analysts usually view sentiment surveys as indicators of future spending. It’s commonly understood that when consumers turn pessimistic, they often tighten their belts. Yet, they don’t seem to follow that pattern. They keep spending, breaking records while grumbling about the economy and asserting that purchasing conditions are dismal.
