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Huge Increase in Credit Card Use Over Black Friday Weekend

Black Friday of 2011 far exceeded expectations for both retailers and analysts. The National Retail Federation said that consumers spent over $52 billion over the Black Friday weekend. Subsequent surveys show that credit cards were used far more frequently than expected. In fact, credit looks to be the fuel that drove the stronger than expected sales.

cash-back-cardsSurveys conducted prior to the Black Friday weekend indicated there would be only a slight increase in the number of consumers that planned on using credit cards as their primary purchasing tool. It appears that the surveys missed the mark by underestimating the true number of those choosing to put their purchases on plastic.

Another telltale sign that proved to be quite interesting was the fact that 14% of people questioned in a Discover Financial Services survey said that they were going to exceed their allotted Christmas budgets this year. Compare that with 10% in the year 2010 and you can see that shoppers are quite intent on spending this year.

The problem is that none of the economic conditions have actually improved to warrant this increase in spending. The unemployment rate still hovers at 9% nationwide and that figure is much higher in many urban areas across the country.

So what does it all mean? Well, in the past couple many years Americans did a nice job in paying down their credit card debt. That looks like a trend that has come to an end. At least in the short term. I would suspect that people are tired of their own personal austerity programs and are aching to get out there and spend money again.

That, of course, means that more consumers will be saddled with more debt. The credit card companies love it, but the overall strength of the economy will certainly take a hit because of it.

Retailers played their role as well by offering some very, very attractive deals across the board. Apparently many of them were just too hard to resist. But that’s their job isn’t it? Can’t really blame them. They are in business to sell their goods and services.

Of course we will have to wait until the holiday season is over before we find out the true extent and breadth of credit card use nationwide. It should be very interesting to see how the final numbers come in and we here at www.creditcardcandor.com will let you know exactly how it plays out.

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