If clothing prices rise 10 percent as predicted by experts in this Associated Press story, will the price hikes dampen the burgeoning consumer revival?
Consumer spending is finally thawing. Revised numbers released Monday by the Conference Board put consumer confidence at its highest level since March 2008. Last week we learned that shoppers pulled out their credit cards and borrowed money for the first time in 27 months.
My in-box has been filled with surveys that detect growing optimism about personal finance. I even received a pitch about frugal fatigue — the feeling that we've pinched pennies long enough.
Surely there's pent-up demand from employed people who stopped spending for fear of losing their job, but are feeling more confident today. If prices increase, my bet is that these consumers, conditioned to wait for a sale, will just wait a little longer for the price they want to see.
I can't tell you the last time I paid full price for a pair of jeans or a shirt. Even when I'm shopping online I can usually find a promo code that takes 20 percent off an order or gives me free shipping.
Now if retailers stop the deep discounts, I know I'd think twice about some of my purchases. But not all of them.
Take my weekend shopping trip to Target. The discounter told analysts last fall that it is likely to pass cost increases along to consumers, as manufacturing reporter Susan Feyder mentioned in a story she wrote last month on rising materials costs.
Yet on Sunday, I was still able to buy a pair of boys athletic shorts and a t-shirt for just $2.25 a piece, regularly priced at $4.50. A 10 percent price increases wouldn't stop me from buying these already rock-bottom priced items. Even at full price, it's hard to argue that these clothes aren't affordable.
