Dreaming of a cheap Christmas

Mon Dec 1, 2008 8:07pm EST
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By Mark Potter

LONDON (Reuters) - The bright "50 percent off" signs plastered over the windows of London's plush new Westfield shopping center don't hold much sway over Helen Marlow.

"I'm going to spend less this Christmas. More for the children, less for the adults," said the 63-year-old retired nurse, bustling empty-handed through the granite and marble splendor of Europe's newest, and most luxurious, shopping mall.

"People aren't spending. People have lost confidence and they are really saving their money."

Governments and retailers, fearing this attitude may be widespread as the financial crisis deters spending from the United States to Iceland, are dreaming up innovative ways to persuade people to part with cash that bankers won't lend.

Governments are giving away billions of dollars in tax cuts to put money into shoppers' pockets.

On the bright side, for the shopper who has any cash to spare, Christmas looks like being a reasonable deal.

"I've bought a couple of nice jackets, one of which was reduced by 40 percent," said Carmen Sanchez, a shopper at Spanish clothing retailer Cortefiel, also offering discounts of up to 50 percent as it struggles to meet ambitious business targets set in a 2007 leveraged buyout.

The worry is consumers will simply use any extra cash to pay off debts racked up when money was easy. Sensing prices could fall yet further, some shoppers are also holding back in the hope of scooping even bigger bargains later.   Continued...

<p>People look at Macy's annual Christmas windows in New York November 23, 2008. REUTERS/Chip East</p>