In a survey by the International Council of Shopping Centers and Goldman Sachs, 8% of respondents said they are likely to increase holiday spending, thanks to the historic election of Sen. Obama to the White House. By contrast, only 5% said they would have increased spending if Sen. John McCain had been elected.
While Michael Niemira, director-research at ICSC, admits those figures don't represent the bulk of consumers, he said it still offers a reason for optimism. "It does say on the margin that getting the election behind us will help," he said. "Now things may change, and that's what we're counting on, even if it's in the margin."
Overall, consumers surveyed by ICSC and Goldman Sachs placed an unusually high emphasis on this election, saying that it was more important than the declining stock market and tanking personal investments as well as job security. "That was a surprising result," Mr. Niemira said. "It may be that the election captured so many different aspects of where consumers felt problems were and how they could be corrected."
Mr. Niemira expects consumer confidence could also begin to recover in the coming months. And a study out from Big Research late last month supports that notion, with 34% of likely voters saying their confidence in the economy would increase with the election of Mr. Obama. By contrast, 26% said their confidence in the economy would increase if Mr. McCain were elected.
"The month of October was a roller coaster. Everybody was anxious," pointed out Phil Rist, VP-strategy at Big Research. "As of 10 p.m. last night, at least half of them are happy."
But don't look for an immediate recovery. There's still plenty of dismal economic news, after all. Tomorrow, retailers are expected to report disastrous same-store sales for October. Projections range from down 0.3% to up 0.25%; results could be the worst on record for the month since 1969.
"It's not totally clear that any new president at this point in time will have a huge impact right away on the economy and the retail sector," said Mr. Niemira. "But to the extent that Obama is a good speaker, I think he can certainly lift spirits, lift expectations and ultimately maybe speed some of the recovery from the consumer side."
Another round of stimulus?
With the election over, retailers are now eager to see whether a proposed lame-duck session to introduce new stimulus legislation will come to fruition. House Speaker Nancy Pelosi said in October that the House was considering such a session. The Senate is already scheduled to return Nov. 17. Democrats, emboldened by new majorities, could move quickly to push through legislation. However, they could just as easily wait until Mr. Obama takes office, and it's certain the legislation won't be vetoed.
"It's going to be very difficult in this environment, in a short period of time to engage in the give and take that would be necessary when there's a lot of raw nerves post-election," Steve Pfister, senior VP-government relations at the NRF said. "Republicans could say we're not going for any of this. You've got the [Democratic] majority ... They could pass something and have [President] Bush veto it."
Still, if a new stimulus package was pushed through before the holidays, retailers could get more than coal in their stockings. The ICSC-Goldman Sachs survey showed that 39% of respondents would spend the rebate, while 38% would save it and 18% would use it to repay loans. The $100 billion tax stimulus that went out to consumers earlier this year was widely applauded by retailers who reported sales jumps. ICSC said that 34% of consumers spent the earlier rebate money, while 29% saved it and 37% used it to pay down debt.