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<p><strong>Surprise! Americans Plan To Spend More This Holiday</strong> </p>

<p class="textBodyBlack">"Forget the credit crunch, housing recession and slowing economy. Americans plan to open their wallets this holiday season, though maybe not on those cheap Chinese toys.</p>

<p class="textBodyBlack">CNBC’s quarterly “Wealth in America Report” finds that American plan to spend an average of $839 on Christmas gifts, up 17% from November 2006. </p>

<p class="textBodyBlack">Spending plans surged in every region of the country--for white collar and blue-collar workers and for nearly every age group.</p>

<p class="textBodyBlack">The survey of more than 800 Americans, conducted Oct. 4 through 6, helps allay fears that the summer credit squeeze and rising foreclosures could cause consumers to pull back on their spending."</p>

<p class="textBodyBlack">I was a little taken back by headline and the first portions of the article but not completely surprised considering that most Americans spend their way out of bad news and saddness. However the following quote floored me and convinced me that our country is spiraling into "bolivian." </p>

<p class="textBodyBlack"><strong>"In fact, the survey found that 74% of Americans have had no trouble getting a loan and 90% of homeowners think the value of their real estate will either stay the same or increase over the next year."</strong> </p>

<p><a href="http://www.cnbc.com/id/21268631">www.cnbc.com/id/21268631</a></p>
 
I guess I don't understand 90% of homeowners then, because house prices across the country are generally either stagnant or falling.





Goes to show you how out of touch most people are with reality..."But the survey does offer a note of caution if housing prices fall substantially. About a quarter of Americans say <strong>they tend to spend less when the value of their homes</strong> or stock portfolios declines. "





Considering home prices are already falling substantially here, we should probably take that into account. I also like how the article says "The survey of more than 800 Americans...helps allay fears that the summer credit squeeze and rising foreclosures could cause consumers to pull back on their spending." What, do 800 people now talk for the entire country? I thought all real estate was local
 
This just shows how irresponsible and out of touch some people are about the economy and markets. Not saying they're stupid, but just not informed. The survey results are in the PDF file in the story.





Question 11a asks about how much money they have invested in stocks, mutual funds, 401k's and IRAs...





73% have less than 100K and another 11% answered not sure or refused. Yet 74% said they had no trouble getting a loan? I'm surprised that out of 800 participants that so many had actually applied for a loan. I guess a car loan would qualify, and that these weren't mortgages.





I must be a cheap-ass because I'm not spending $839 on christmas gifts this year.
 
A country that sits on its ass all day watching, desperate housewives, top chef, Flip that House, and reads OK magazine, doesn't understand the concept of reality. Our reality is tv, and unfortunately people will eventually learn that TV isn't reality.
 
<p>Dont believe everything you read, it is all a marketing campaign by the few people who run this country (and I am not talking about the government) .... Many of the people I know are hurting really bad...</p>

<p> </p>

<p> </p>
 
I can't wait until November when Real Housewives of OC & Project runway return. Property ladder is much better than Flip that house.





As for reality, I think the banks are more complicit than the stupid consumer. The banks should, in theory, know what they're doing with all of their MBAs and PHD economists they hire.





I can't believe that only 74% of people said they had no trouble getting a loan, I suppose it depends upon the zip code where you live. When I was 19, working part-time for minimum wage, I applied for my first credit card. They gave me a $10,000 limit. Perhaps they thought my yearly income was my hourly wage.
 
<p><em>"The banks should, in theory, know what they're doing with all of their MBAs and PHD economists they hire."</em></p>

<p>I wish I had some facts to back up this next statement that I am abou to make, but really it is just my thoughts and speculations. I doubt there is even <strong>1</strong>, yes <strong>1</strong>, Phd economist who can make money in the markets.


</p>
 
awgee-I can tell you there are PhD economists who are making good money in the markets. I've seen the portfolios of some of them. Remember 1) law of large numbers - there are a lot of economists out there and 2) What really kills people when investing is trading fees. Several PhD economists I know are actually fairly aggressive in their investments since their incomes are rather uncorrelated with the market since they work in academia and have tenure so getting fired because the stock market is down is more difficult. The reason women tend to outperform guys in investments is mainly related to the guys who are busy daytrading their portfolios and/or loosing their shirts trading forex. PhD economists who have over $1M in their Fidelity/TIAA-CREF 401k accounts tend to follow the simple principles that stocks tend to outperform bonds and don't sell your portfolio on a down month/year. If you have had a high emerging markets portfolio in your 401k in 2007 you have not done too badly - I know one PhD economist whose portfolio is up 50% YTD in 2007 as a result.
 
Well maybe that is the explanation. I don't actually personally know any Phd economists and the only folks I personally know who share their portfolios with me are my clients. And if someone did tell me how they were doing, I might be a bit skeptical. I guess the only contact I have had with Phd economists are the articles I have read, and most of the time, ie. Bernanke, I find them laughable.
 
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