Explaining Southern California's economy

Why Black Friday can't save us from the fiscal cliff

"Black Friday" Marks Start Of Holiday Shopping Season

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Marking the start of the holiday shopping season, 'Black Friday' is one of American retailers' busiest days of the year.

Now that Black Friday 2012 is in the history books, we can all start arguing over whether it lived up to the hype. Forbes' Tom Van Riper cites a Deutsche Bank analyst who says that the results were basically flat compared with last year. CBS News sees it a little differently.

Regardless of how the big day ultimately works out, there are some inevtiable questions — given our continued sluggish recovery from the Great Recession — about whether the consumer can somehow rescue the economy. That could be too much to ask of the retail sector, which makes up less than 10 percent of U.S. GDP, as I noted on "AirTalk" ahead of Black Friday and its more recent offspring, Black Thursday. 

Others disagree. Last week, the L.A. Times ran a macro/microeconomics-mash-up-story about the Black Friday shopping frenzy and what it might mean for the overall economy, beyond the bottom line of retailers. Here are the critical paragraphs:


A Patagonia jacket that will never pay off its debt to the environment

A colleague here at KPCC passed this full-page New York Times Black Friday ad along to me. It's from Patagonia, and the title says it all. Well, OK, it's not that Patagonia doesn't want you to buy its products. But it does want you to know that the R2 jacket shown is like "all the things we can make and you can buy" because "it comes with an environmental cost higher than it's price." 

What I'm wondering about this conclusion — which Patagonia lays out very convincingly in the ad's copy, confessing to gobbling up 135 liters of water and generating 20 pounds of carbon dioxide creating and marketing just one R2 jacket — is whether Patagonia has done a truly full lifetime analysis of the garment.

And here's why (this is where I go anecdotal): Patagonia products are of ridiculously high quality. Patagonia says the R2 is "exceptionally durable, so you won't have to replace it as often" — and even then they'll take it back and recycle it — but what if you...never replace it? 


It's Black Friday versus the eurozone crisis

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Black Friday at Macy's in Manhattan: Shoppers lined up.

Welcome back! I hope everyone had a happy Thanksgiving. In fact, it appears as though many of you did enjoy the holiday — enough to hit the malls in force on Black Friday. According to the LA Times, retail activity was up 16 percent over last year. And the markets are responding: all the major stock indexes have climbed this morning. 

Meanwhile, the neverending eurozone crisis appears to have entered a new phase. We keep waiting for an endgame here, with the likely demise of the euro single currency. But then Germany and France get together to pull the eurozone back from the brink. This dynamic has caused predictable volatility in world markets for months now. But in the U.S., there's at least some improving news, giving markets the chance to rally on their own and somewhat ignore Europe.


U.S. GDP growth is revised lower, but that's no reason to panic — yet

Should have gotten to this yesterday, but better late than never. And just in time for Black Friday, the traditional kickoff for the holiday shopping season!

The Bureau of Economic Analysis revised down its data for U.S. GDP growth in the third quarter. What was 2.5 percent, which was pleasantly surprising when it was announced, became 2 percent. So the economy grew in the third quarter, just not as much as was originally thought.

This isn't really a good thing — that 2.5 percent figure caught observers off guard and gave economists firm reason to believe that the economy isn't going to fall into another recession. But under the circumstances, 2 percent isn't terrible. And losing half a percentage point of GDP doesn't mean that we have to gird ourselves for a double-dip. In fact, it means that the economy continues to grow, a sign that if nothing else, unemployment won't climb higher than 9 percent.