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Signs that spending may be picking up

A Target customer shops for back-to-school supplies at a Target store in Daly City, Calif.

TEXT OF STORY

BILL RADKE: Numbers out today show we are opening our wallets a teeny bit more than we did over the summer. Marketplace's Eve Troeh is here live to tell us more. Hi Eve.

EVE TROEH: Hi.

RADKE: So we're going to get a a clearer picture of September spending tomorrow when the big retailers release their numbers. But there are some hopeful signs today?

TROEH: Yes, hope in the form of MasterCard. Well, specifically their Spending Pulse report, and that tracks card swipes as well as cash transactions. It shows people bought lots of school supplies, clothes for kids and teenagers, and small electronics last month -- that makes sense for back-to-school season. Costco also reported a 10 percent increase in sales for September and that helped them report a better-than-expected profit for the fourth quarter. So Costco, socks, calculators -- we're mostly buying basics here, not luxuries. But economists are happy to see any signs of growth at all.

RADKE: Yeah, I imagine. What about Santa suit sales? That's what's really making them smile, right?

TROEH: Well, a bunch of economists in Santa suits would make me smile. But yes, investors and retailers are flipping the calendar ahead to November and December and they hope the little bitty growth we're seeing right now will mean a stronger holiday shopping season. The National Retail Federation expects a boost of about 2 percent in holiday sales from last year. That doesn't sound like much, but that would make this the best holiday season since 2006. And stores could hire more people to work there as well.

RADKE: Let's hope so. Marketplace's Eve Troeh, thank you.

TROEH: Thanks.

About the author

Eve Troeh is News Director at WWNO-FM in New Orleans, La., helping build the first public radio news department in the station’s 40-year history. She reported for the Marketplace Sustainability Desk from 2010 to 2013.
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Folks: take another look at the purchases. Costco, BJ, Sam's Club are doing land office business in high volume purchase of foodstuffs with long shelf life: peanut butter, canned meat, canned anything. Perishables sales and high end or inflated items (e.g.: refrigerated food, coffee, furniture and large electronics) are not moving at all.

What I see is a burst of people that have reason to believe their pink slips are on the way filling the shelves in their basements to weather what may be the worst economic storm of their lives.

Holiday sales this year will be flat, and worse than flat for clothing and durables. The NRF is whistling in the dark to avoid spooking distribution centers into whining for discount pushes early in the season.

One thing good for retail (bad for consumers): inventories are way off even last year's numbers. Import container freight has fallen off sharply long before the normal Christmas season import period ends, meaning that the transport sector and importers are already battening for bad weather through 2nd quarter 2011, a year that promises to be worse than 2008 for retail, transport and high end household goods.

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