Holiday merchandise has been out in stores for more than a month, and some retailers say they hope stretching the season will improve their bottom line. University of Northern Iowa economic professor Fred Abraham isn’t banking on any retail records, though. He says people don’t like uncertainty, and there’s a lot of uncertainty right now about terrorism and what we’ll do in Iraq, which could make consumers spend less than normal. In addition to those worries, Doctor Abraham says the economy’s still sluggish. He said the Federal Reserve must think the economy needs stimulating, since a couple weeks ago it lowered the trargeted fed-funds rate half a percentage point. Combine the sluggish economy with the uncertainty, and he thinks we could see disappointing holiday sales. The economist says this holiday shopping season could be critical to many small businesses. In some businesses, as much as 25-percent of the annual profits come in the holiday season, so if it’s not a good one, they could be forced to close. Thanksgiving falls very late in Novemebr this year, leaving barely three weeks in the traditional shopping season before Christmas.
