Friday, November 16, 2012

Discussion Topic 11/16/2012;_ylt=AjZAszZlz3RwFUEPdZtTWkfpuYdG;_ylu=X3oDMTN0aDZlbnBtBG1pdANOZXdzIFRvcCBTdG9yeSBMaXN0BHBrZwMyZTcyZWQ4OS00YzZiLTMxODAtOTMxYi01OTcxNjViYzlkYWQEcG9zAzMEc2VjA3RvcF9zdG9yeQR2ZXIDZjJiNDZjYjAtMmYzYy0xMWUyLWJmYmYtOTI5MmU0Njg1OGM4;_ylg=X3oDMTFpcW84dHVuBGludGwDdXMEbGFuZwNlbi11cwRwc3RhaWQDBHBzdGNhdANuZXdzBHB0A3NlY3Rpb25z;_ylv=3
Do you think the coming Christmas will be blue? Why is that?


  1. Tim Shoji
    I believe Obama and the Republicans will be able to come to an agreement by the end of the year. Out of habit, Americans will be buying gifts as usual. Christmas spending not suffer as a result. Even if the government isn't able to reach an agreement, it won't affect consumer behavior until the beginning of 2013.

  2. Pian Li
    i dont think that fiscal cliff will influence the christmas this year. Since the fiscal cliff is the combination of $7 trillion in tax increases and spending cuts over 10 years that is set to begin Jan. 1, 2013, consumers wont think too much about it until next year. Whats more, there are too many uncertainties in this fiscal cliff. Maybe there will be agreements too cancel some laws to prevent fical cliff from happening. Or there will be lower inflation rate, or high salaries..... All the things are uncertain so consumers have no reason to change their consuming behavior at all.

  3. Xiao Zhong
    It is not only current disposable income that determines consumer spending, consumer confidence is playing a part as well. Public pressure is urging President Obama to sit down with Republicans and come up with a solution by the end of this year, and consumers would more or less expect a policy to extend the tax cuts. So it is too early for consumers to start holding back during this year’s Christmas season.

    Also, even without the fiscal cliff, the US economy will still be struggling next year because of long-lasting effects of this recession and ineffectiveness of government's previous rounds of QEs. Even if consumer confidence is adversely affected in next few weeks, it is not just fiscal cliff that causes the effect, but the whole economy is pushing consumers to save more and plan for the upcoming year.

    So I agree with Tim and Pian that the coming Christmas season would not be affected so much by concern over the fiscal cliff.

  4. Mengyao Kong
    everyone is just waiting. However, I don't think the recession will affect the consumer spending of the christmas. Remember the end of 2011, and on Jan, the consumer spending number surprise everyone. I think it is just like christmas will not be affected by the recession. The christmas money is sth we have to spend. It is like our spring festival. It is about to tell each of your friend, relative, parents, I am not a loser.

  5. Amine Bensaid
    I think the uncertainty in the fiscal cliff negotiation will have an effect on consumer spending either in a positive or negative way. If tomorrow's fiscal cliff negotiation starts badly, you can expect consumers to start thinking about their incoming payroll tax cuts in January. I also think that fear will be the most determinant factor in this situation, if people think the fiscal cliff negotiations are moving towards a common goal, the fear levels will be lower and thus consumer spending will increase. On the other hand like I stated earlier, if the negotiations turn sour and there are real reasons for concern I think consumer spending will certainly be affected.

  6. Tian Tan
    I agree with you guys that people are going to continue spending money this Christmas. But American may need to change their consumption model in the future. As the analyst said in the video, people in America are spending too much money on unnecessary things. If people continue spending like this, their financial balance will deteriorate and may cause another credit crisis in this country.

  7. Zhishuo Zhang
    I agree with Pian that there is too much uncertainty about the negotiation. Even the expectation is that the payroll will be horrible next year, people may still be willing to take the chance thinking that things may not be as bad as they thought. Everybody wants a nice Christmas, nobody wants to cut a large portion of spending on this big holiday, and this will result in collective decision. Therefore, my conjecture is that consumers will not change their behavior until the holiday is over.