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Tuesday, March 1, 2011

Many happy (tax) returns

Over the past few years, many consumers used their tax refund to pay off bills and pare-down consumer debt. A Research Brief that was published yesterday suggests that more people will use their refund as “fun money” this year, replacing home electronics, furniture, or even buying a vacation. That’s according to an NRF study cited by the story, which you can read in full by clicking here.

Implications: We knew that the recession would be followed by a period of pent-up demand, as consumers relaxed a bit from their self-imposed (or economically-forced) policy of restraint. Now that the job market has at least stabilized (it doesn’t seem to be getting any worse), and many people have at least made progress in their decision to control debt… they’re in a position to indulge, at least a bit.

Now… if fuel prices will just not mess things up…

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

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