Thursday, November 06, 2008

Only 39% say they would shop for holidays with stimulus check

Some members of Congress are considering sending out another economic stimulus check in time for Americans to do some holiday shopping.

But a shopping center industry survey released Tuesday said that while 39 percent of consumers expect to spend the extra cash, 38 percent said they would save it and 18 percent said they would pay down debt.

The results are from a survey of 1,000 consumers commissioned by the International Council of Shopping Centers and Goldman Sachs. It was conducted Thursday through Saturday by Opinion Research Corp.

Retailers worried about the newfound tightfistedness of U.S. consumers have been pushing for a rebate in time for holiday shopping. Forecasts call for the weakest sales gains in the November-December period since the 1990-91 recession.

Among consumers who would spend a tax rebate, 21 percent said they would use it on holiday gifts and 18 percent would spend it on themselves and their families, but not on holiday gifts.

Regarding the tax rebate earlier this year, 29.3 percent of consumers reported that they saved it, 37.1 percent used the money to pay down debt and 33.5 percent spent it.

Last month, J.C. Penney chairman and chief executive Myron "Mike" Ullman said he favored the government sending out stimulus funds to consumers in the form of gift cards, similar to those Hurricane Katrina victims were issued for emergency purchases in 2005. Last summer's economic stimulus checks were absorbed by higher fuel prices, he said.

On Thursday, Penney expects to report that it had another steep decline in October sales. It cut its earnings estimate for the third quarter after it reported a worse-than-expected 12.4 percent drop in September same-store sales.

In the shopping center poll, consumers also were asked to rank the importance of the election and other factors on holiday spending on a 1-to-10 scale, with 10 being the most important.

The outcome of the presidential election received an average reading of 6.2, but the high cost of living ranked highest at 6.9.

The next-most-important factor was the declining stock market at 5.5. Job security scored 4.3.

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