My Home About Me

That’s right friends, the official start of the holiday shopping season is right around the corner. For years the day after Thanksgiving has been known as a day when retailers offer the best deals of the year and shoppers flood into malls across the country to take advantage of the low prices.

While shoppers are bound to leave stores this Friday feeling satisfied with the fact that they took advantage of the great sales, one has to wonder who benefits more… stores or shoppers? The fact that these sales start at 6 a.m. (or earlier), last for a very limited time (usually just a few hours), involve large crowds and limited quantities as well as an abundance of holiday decorations, Black Friday serves to create an atmosphere that thrives on impulse buys. Sure shoppers are paying less for the newest electronic goods and latest fashions, but this savings is offset by the high pressure environment that inevitably accompanies Black Friday.

In thinking about this day, I began to wonder where we got the term “Black Friday.” Like so many other traditions, I think many of us take the name for granted, without really knowing the meaning behind it. Wikipedia offers two possible origins for the name. One directly relates back to the stress shoppers face when dealing with large crowds, pointing to the possibility that this day can be a negative experience.

The other possible explanation points to the traditional accounting practice that financial losses are indicated in red ink in their records while financial gains are written in black ink. Since many retailers are believed to operate at a loss throughout much of the year, the holiday season marks a time when stores can make up for the difficulties they face throughout the year and turn a significant profit (which would be indicated by black ink).

Ironically, while stores profit from the sharp increase in spending many consumers (which receive no increase in income except for a possible Christmas bonus), will undoubtedly shop their way into debt. My advice is to approach Black Friday, and holiday shopping in general, the same way you do your investments decisions – plan ahead! Use the pre-holiday advertisements and the fairly recent emergence of Cyber Monday (the online holiday shopping season which starts the Monday after Thanksgiving) to help you plan your purchases and reduce your susceptibility to impulse buying.

On a side note, another color that will be prevalent in the coming weeks is red, as the Salvation Army recently launched its annual Red Kettle Campaign. So if you are one of the brave souls that will be heading to the malls this Friday, take a minute to drop some change into one of the kettles.

Investor Term of the Day: Rate of Exchange
Rate at which one currency may be converted into another. Generally, one unit of the home currency is expressed in terms of another currency. For example, an American bank may quote the exchange rate between the dollar and the Yen as the number of dollars needed to buy one yen. Also called exchange rate or foreign exchange rate or currency exchange rate. 22Dollars.com - Financial Investment Commentary
22Dollars.com is your online source for advice on how to grow your personal wealth by managing your own money. Here you will find investment ideas, stock quotes, charts, business news, market research and a learning center for all things financial because in the end, no one cares more about your money than you.

iShares Hong Kong (EWH)   Technical chart patterns   support/resistance levels   ETFs (exchange traded funds)   Deron Wagner   S&P 500 chart pattern   emini's S&P 500   earnings   economic data   Biotech HOLDR (BBH)   Emini's Nas 100   Short selling ETFs   exchange traded funds   sector rotation   etfs   corn futures   selling options   commodities   mcio   minecore