This data may show how close to the precipice of recession our economy really is.  The MasterCard Advisors Spending Pulse Report issued on Chistmas day said that sales in the two months before Christmas increased 0.7 percent,
compared with last year. Many analysts had expected holiday sales to
grow 3 to 4 percent.

The Spending Pulse data include sales by retailers in key holiday
spending categories such as electronics, clothing, jewelry, luxury
goods, furniture and other home goods between Oct. 28 and Dec. 24. They
include sales across all payment methods, including cards, cash and

Many retailers and consumer goods manufacturers generate about 40-60% of their annual sales during the two months prior to Christmas, and a weak holiday season translates into lower than expected sales that cannot be recouped until next year.

U.S. holiday retail sales this year were the weakest since 2008, when the nation was in a deep recession. In 2012, the shopping season was disrupted by bad weather and consumers’ rising uncertainty about the economy.

In 2008, sales declined by between 2 percent and 4 percent as the financial crisis that crested that fall dragged the economy into recession. Last year, by contrast, retail sales in November and December rose between 4 percent and 5 percent, according to ShopperTrak, a separate market research firm. A 4 percent increase is considered a healthy season.

Shoppers were buffeted this year by a string of events that made them less likely to spend: Superstorm Sandy and other bad weather, the distraction of the presidential election and grief about the massacre of schoolchildren in Newtown, Connecticut.

The numbers also show how Washington’s current budget impasse is trickling down to Main Street and unsettling consumers. If Americans remain reluctant to spend, analysts say, economic growth could falter next year.

The results were weakest in areas affected by Sandy and a more recent winter storm in the Midwest. Sales declined by 3.9 percent in the mid-Atlantic and 1.4 percent in the Northeast compared with last year. They rose 0.9 percent in the north central part of the country.

The real bottom line from this report is that many companies, industries and/or areas of the country are closer to recession than we might have originally thought.  And should the President keep trying to make the fiscal cliff a political victory, this nation’s economy will fall quickly.