Could Black Friday be a complete bust this year? Let's explore the potential sources of a Black Flag Friday. Black flags are used to denote mourning, as in state funerals, and to warn of danger, for example, black flags posted at beaches mean "don't go in the water."
Drivers in auto races who receive a Black Flag must return to their pit--their race is over.
Exhibit One is the Federal Reserve report which stated the bottom 80% of American households have fewer financial resources than they did pre-pandemic.
The authors project that the cash reserves of this vast cohort would be depleted in the third quarter of 2023, i.e. right now.
Exhibit Two is a report that indicates half of employed consumers have side gigs to earn extra money. Side Gigs Help Ease Paycheck-to-Paycheck Consumers' Financial Stress This Holiday:
According to findings detailed in The Supplemental Income Edition of 'New Reality Check: The Paycheck-to-Paycheck Report' by PYMNTS Intelligence and LendingClub, half of employed consumers now have supplemental income sources in addition to their regular paychecks. This includes side jobs, other types of supplemental income and active side incomes.
This is critical because the holiday season has emerged as the most financially challenging period for a significant number of individuals, according to separate research from PYMNTS Intelligence, with over 20% pointing to vacation costs as a key contributor to their financial stress.
Exhibit Three is the "revenge spending splurges" on vacations and other luxuries have already depleted savings and boosted credit card balances. Vacations are prime examples of "greedflation" in action, as resorts, AirBNB hosts, et al. jacked prices to the moon knowing that households desperate for a splurge vacation would pay any price without question.