My wife and I took a trip to three different Mall's in our area (On the Saturday after Black Friday), and this is what we saw;

1) Considering it was a holiday weekend, the largest Mall in our area had very few shoppers. The shoppers we did see were not loaded down with purchases, they were basically walking around.

2) The second Mall was more upscale, in an upscale area. The parking lot was full, and people were buying. Women and young adults were the buyers while the men were eating, drinking, and sitting in the massage chairs at Sharper Image (me included).

3) The third Mall was pretty nice. American Eagle was busy (selling their Salvation Army look-a-like clothing), Abercrombie & Fitch (more expensive Salvation Army look-a-likes) had browsers but not a lot of buyers. Panera Bread was jammed.

Is it just me, or are all of the clothes that you and I threw away (holes in pants, severely worn) as kids now being sold at places like American Eagle, Abercrombie & Fitch, and Gap?

I quickly concluded that our economy (gas prices and inflation) has taken a toll on people with lower-lower middle class incomes. Arm chair economists know that consumption accounts for about 70% of GDP growth. So, if 70% of GDP is the consumer, I would like to know what percentage of the 70% the various income classes represent.

Weaker sales at Wal-Mart this weekend was one of the catalysts for today's sell-off in the market. Given the reaction, I would guess that the lower-lower middle class income group carries a pretty big stick. I've been telling you for quite some time that the CPI numbers do not reflect what is happening in the real world. The average consumer is seeing their incomes evaporate because of a higher cost of living and massive inflation. Many of a consumer’s daily expense are not properly accounted for in the CPI data.

Today, we are finally seeing a small dose of reality.