Financial forecasters predict decreased holiday sales

FROM HOUSTON COMMUNITY NEWSPAPERS

By Valerie L. Clifton
12/13/2007

From rising gas costs to wary consumers steering clear of toys that may be recalled, it's not looking good for retailers this season.

But College of Business Administration at Northeastern University Professor Tony Gao said that reports of increased Web spending shouldn't boost consumer confidence in the economy.

Conservative forces are influencing holiday spending behaviors, he said, driving consumers to comparison shop, a task that can be easily accomplished from behind the monitor.

"Most people are doing this from their home via high speed Internet," Gao said. "I suspect that households with high speed connections tend to have higher income."

Lower income families tend to do more shopping in store, he said. Gao said in addition to the rising price of gas and oil the economy is taking hits because of the depreciation of the US dollar which is causing a loss of confidence in overseas investors.

"Foreign investors aren't as confident as before in the US economy," Gao said. "This realization might lead them to take their investments away from the US market."

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