Friday, November 26, 2010

Black or Red Friday?

It Depends.....

This day after Thanksgiving has two theories of its meaning, I venture to say it has also two outcomes. Consummerism and its behavior will play out as usual on this day. The masses are driven by a media chaotic and frenzy way to boost sales. This is very good for the economy, but as we have learned it is really bad for consumers that spend beyond their means and place these purchases TODAY on a high interest bearing Credit Card. So, is it Black or Red?, it may help retailers go from red to black today-a good thing; but it will certainly will take many consumers into the red. Usually into many years to come. Shopping is an experience and a thrill containing euphoria and excitement. An art actually; to shop for the best bargain and the smell of new; Yes we deserve it this year.... we have gone thorugh a lot, yes we deserve to treat ourselves and buy something we want...

But consumers seldom have the big picture in mind during shopping and or a clear budget analysis. Black Friday depends on consumer behavior and impulse buying. Yes, today you can get really great deals today and you should. But ask this question: "Do I need it or is it nice to have? or Am I paying it so I can own it today or am I going to pay premium prices if I put it with a credit card?" Basic math: look at your credit card's interest rate you will owe. Consider if you can pay it before 30 days. Consider your bank's interest rate of your account. So if you still want to use your credit card you should have that money in the bank at the very least. One more question to ask oneself: "How safe is my job? what would I do if I get laid off? Do I have one year of savings to cover my expenses; btw, a year is what is taking someone to find a comparable job.

Here are the two theories of Black Friday:

The first theory about the meaning behind "Black Friday" relates to accounting and the practice of recording losses in red and profits in black. Since the sales extravaganza is often considered one of the busiest shopping days of the year, stores go from being in the red to being in the black.

The second theory about the meaning behind "Black Friday" is a much more simple, and a much more likely origin. In terms of history, a day is referred to as black if a great disaster occurred, such as the black day in the 1920s when the stock market crashed. However black doesn't always have to be a negative term and can also refer to a basically chaotic day. As shoppers mob stores on the big sale day, it is definitely a chaotic time.

For more information or to request a BUDGET CASH FLOW ANALYSIS PROGRAM visit our website and send for a quote.

Happy Holidays Everyone

No comments: