Christmas spending has always been considered an indicator of consumer confidence, the Christmas retail season produces a huge percentage of retail profits for the year, it is an important indicator.
It was obvious about 2 weeks ago that tax cuts were coming, my guess is that some consumers spent a little more anticipating their taxes coming down and would apply those savings against their Christmas credit card debt.
Another area that creates confidence going in to the Christmas retail season is for consumers to see their retirement accounts up substantially, and other invested savings to be up substantially, although increases in investment account values may not be realized, consumers feel more confident about spending because their emergency funds have grown and they feel more confident they can weather an unexpected expense.
Bottom line people do not increase discretionary spending unless they feel more confident about their financial future.
