Retailers are already busy as beavers planning their Black Friday promotions for November 28th. But guess what else might arrive on November 28th? Default on the sovereign debt of the United States of America! This could put a bit of a damper on the Black Friday festivities. According to Washington Post, the GOP is going to propose a six-week extension on the debt ceiling talks. That would push the debt ceiling breach deadline from October 17th to the end of November.
Would the default really slow down the frenzy of fighting over $20 toasters and $149 tablets? It just might.
According to Gallup’s Economic Confidence Index, the American consumer confidence tanked from -20 to -35 after the government shutdown started and has not rebounded. It is not clear what would happen to consumer sentiment in case of a sovereign debt default. But it is conceivable that the ensuing chaos may impact sales of new Xbox Ones, iPads, PlayStation 4 consoles and many other gadgets just a tad.
Financial Times reports that one senior executive said his bank was putting 30% more cash than usual in its ATMs. The worst-case scenario has Americans making a run on banks in anticipation of a collapsing economy. This would potentially lead to real steals as unsold inventory builds up at Best Buy throughout December and is then liquidated through deep discounting.