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US Consumer Confidence Still Low as Holiday Shopping Season Begins


As the beginning of the traditional U.S. holiday shopping frenzy approaches, there are deep concerns about how the faltering economy might affect spending choices. As VOA's Catherine Cannon reports from Washington, the economic crisis has hurt consumer confidence in the United States and left both retail store owners and shoppers skittish this holiday season.

Economists say confidence in the U.S. economy has improved since the financial crisis began, but it is still at a very low level. This week, the New York-based Conference board said its consumer confidence is about half of what it was this time last year. As people struggle to deal with job losses and dwindling retirement funds, their outlook of the country's economic situation remains pessimistic during the biggest consumer spending time of the year.

Claire Rusk, a shopper in Alexandria, Virginia, says she is changing her holiday spending habits this year because of the economic crisis, even though her nine-year-old son expects Christmas as usual.

"His list is longer than ever, so I was listening to how you tell him that his list better be shorter this year," she said.

Rusk says the crisis is forcing her to think hard about her purchases.

"I'm just going to be more careful. I'm going to make a list. I'm not going to randomly shop," she noted. "I usually just go out and shop, but I'm going to have a plan before I go out this year."

And Rusk is not alone. Kilmer Caban, a shopper at the Pentagon City Mall outside Washington, D.C., says he is going to try to spend the same amount for gifts as last year, but he knows some of his family members are cutting back.

"My sister and her husband say they will not be spending as much, due to the cost of gas and the economy and everything," he explained.

Some retail store owners, who normally make the bulk of their profits this time of year, are hopeful that the holiday shopping season will still be able to pull them out of the recent slump. Victoria Birkett, the owner of Embellishments, a gift store in Alexandria, Virginia, says she a little worried, but she is looking forward to the holiday rush.

"In this retail business I have cut my order down a little bit from prior years, but I can see people are being a little more cautious in their spending," she said. "I'm a little concerned, but it is just before Thanksgiving, so I'm hopeful that things will pick up just after Thanksgiving."

Birkett says her gift shop has not felt the effects of the economic crisis as much as other store owners she knows because it is close to Washington D.C. and benefits from tourism.

Alexander McCall, a manager at Game Stop, in the Pentagon City Mall remains optimistic as well.

"People are a little bit more careful with their money now, the spending has gone down a little, but I think all in all its going to be a good business holiday for everybody," he said.

Despite the slump in consumer confidence McCall still expects demand for some items to rise next month.