Economy Watch: Consumers More Chipper Ahead of the Holidays
- Dec 13, 2010
December 13, 2010
By Dees Stribling, Contributing Editor
Consumer sentiment turned more positive unexpectedly in early December, according to the latest Reuters/University of Michigan’s consumer sentiment index published on Friday. The index came in at 74.2, compared with the first half of November, when it was 71.6, putting it at its highest level since January of this year.
Why are consumers seemingly more peppy toward the end of 2010, a miserable year for consumer sentiment for the most part? November’s employment numbers weren’t very good, but except for that hiring has been trending upward lately. Also, wages have been going up for the employed, though that too leveled off in the most recent reports. Or maybe it’s just Christmas cheer. Retailers certainly hope that whatever it is, it extends to shopping behavior in the run up to Christmas itself.
But if economic indicators don’t start improving again, sentiment will probably go down early in 2011. Consumer sentiment likewise had a small bounce upward in the second quarter of 2010, only to crumple during the third quarter when job growth mulishly refused to pick up.
Bank of America Ramps Up Foreclosures
Bank of America has said that it is re-starting foreclosure sales, which it stopped in October. The banking giant was careful to add–perhaps in the spirit of not appearing too Scrooge-like in mid-December–that it’s starting with vacant and non-owner-occupied properties.
Holiday season or not, the bank has been preparing to ramp up its foreclosure efforts for a while now. Bank of America previously announced that it was restarting the process for submitting affidavits of indebtedness in the judicial foreclosure states, and, based on resulting court judgments, foreclosure sales will proceed too. The bank has given foreclosure attorneys the green light to go ahead with 16,000 foreclosure cases this month.
“We have identified areas of our process that can be improved, and while we make these improvements, it’s important that we move ahead with efforts to reduce the number of abandoned properties across the country,” Barbara Desoer, president of Bank of America Home Loans, said in a statement on Friday.
A&P Files Chapter 11
The storied retailer A&P, the very first coast-to-coast supermarket chain early in the 20th century as the Great Atlantic & Pacific Tea Co., has filed for Chapter 11 bankruptcy. According to the filing, the Montvale, N.J.-based chain, which operates nearly 400 stores, has total debts of more than $3.2 billion and assets of about $2.5 billion.
“While we have made substantial progress on the operational and merchandising aspects of our turnaround plan, we concluded that we could not complete our turnaround without availing ourselves of Chapter 11,” said A&P CEO Sam Martin–the latest among four CEOs in about a year for the company–in a statement. He did not say, though other observers have, that the likes of warehouse stores (Costco et al.) and discounters (WalMart et al.) have eaten his company’s lunch.
Wall Street saw an upward bounce on Dec. 10. The Dow Jones Industrial Average gained 40.26 points, or 0.35 percent. The S&P 500, reaching its highest level since before the Panic of 2008, was up 0.6 percent, and the Nasdaq advanced 0.8 percent.