xmas sales update

In a previous blog i wrote about my shopping impressions from NYC. I've also done a bit of research for Europe and things are looking surprisingly strong.

Here in the UK i visited the newly opened Westfield Mall in West London. Tons of people was my first impression. I spoke to a couple of people in the shops. Luxury brands are finding it tough (but that might also be the location - anyone who's been to Shepherds Bush will know what i mean) but "normal" retailers said that they were quite happy with Xmas business so far. I will put the queue in front of the UGG store into the "fashion faux pas" category rather than good xmas biz. Oxford street is also buzzing and judging from the number of people out there things seem to be going OK - possibly also thanks to the VAT cut by Mr Darling. This impression was also confirmed in some chats with friendly staff at Nike Town, Waterstone, Selfridges and a couple of other shops.

Europe's largest economy, Germany, also seems to be going in line-ish with last year's great result. This is an article from the Guardian about how things are going http://www.guardian.co.uk/business/feedarticle/8132545. "Major German retailers said on Monday (Dec 8th)they were satisfied with the Christmas season trade so far, and that consumers were continuing to shop despite the global economic downturn."

Finally in my home country of Austria news are also that sales are on track to at least meet last year's good results. Electronics and books seem to be the laggards this season vs last (electronics possibly due to large ticket item and lack of killer product).

I think the consumer is being underestimated. Yes, the effects on the real economy are lagging developments in the capital markets but i think we in banking are missing how little the average consumer understands and cares about the banking crisis. And while house owners are facing scary times with property prices coming down and some locked into expensive fixed rate mortgages it is important to keep in mind that large parts of Europe are nowhere near as leveraged as the UK, Spain and the US. And with regards to the UK the Bank of England has reacted very quickly to lower rates and alleviate the pressure on mortgage owners.