Not only that, gift cards are being used to buy basic goods, not luxury items.
WASHINGTON – Here’s a sign of how shaky the economy has become: Wal-Mart says its shoppers are redeeming their holiday gift cards for basic items â€” pasta sauce, diapers, laundry detergent â€” instead of iPods or DVDs.
Merchants had hoped shoppers armed with gift cards would provide a lift after a dismal holiday shopping season â€” partly because shoppers tend to spend even more than the value of the card. But that didn’t seem to happen last month, and retailers are feeling the pain.
On Thursday, the nation’s retailers turned in their worst January in almost four decades as high gas and food prices, a slumping housing market, tighter credit and a tougher job market pushed consumers to the edge.
Personally, I see this as a good sign. People are paying attention to their credit card debt and are deciding that their money is better spent on the necessities. So if a recession is needed to correct our society’s credit card mentality, so be it. It’s about time we tightened our belts and got our collective finances in order. The less we’re in debt and the more we save, the better off we’ll be.