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Does the fiscal fight dampen holiday shopping?

6:41 PM, Dec 24, 2012   |    comments
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It's a lot of activity, but experts are a little less optimistic about what will happen to sales figures this season.

Retail analysts firm ShopperTrak revised its holiday shopping estimates down. The group expects sales to add 2.5 percent to last year's holiday shopping figures. It had previously predicted growth of 3.3 percent.

That may seem like a small revision, but it represents about $2 billion in lost economic activity.

It's hard to pin the late-season revision on any one thing, but you can't ignore the fact that Congress went home last week without reaching a deal to avoid going over the so-called "fiscal cliff."

That's a series of automatic tax increases and spending cuts that take effect next year if Congress doesn't act.

Shoppers, many of whom could face smaller paychecks next year, are thinking about the lack of Congressional action as they walk the malls.

"[I'm] Just kind of worried about what the year's going to bring with the economy," Luana Schmidt, a shopper at the Cherry Creek Shopping Center, said.

Schmidt was visiting from Houston and chose not to haul a bunch of gifts in her luggage. She says she's not spending more on gifts than last year.

Retailers would much prefer everyone approach this year's holiday shopping with the attitude of Cory Wendling, a local teacher who says he's spending more this year than last.

"I'm trying to take a running leap over the fiscal cliff. That's why I'm out here today," Wendling said. "I think it's best to laugh in the face of cliffs."

The wide range of reaction to the fiscal battle in Congress causes ShopperTrak to hesitate to draw solid conclusions about how much the issue is affecting sales.

"I think it's really too early to say," said Teresa Kruger with ShopperTrak.

(KUSA-TV © 2012 Multimedia Holdings Corporation)

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