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Well I have been through five gift openings at four locations so far and just two more to go. The last will be back home when we finally return. I do not remember all this house-to-house gift opening as a child, but, then again, I don't remember this many gifts either. Anyhoo, it will be nice to get home. I enjoy seeing family, but there is a lot to be said for home-sweet-home.

Santa Scrooge

Despite all the gifts I saw, it appears that this was a rather slow season for retailers. Despite massive discounts, the customers were just not coming in the doors. I know this is bad news for retailers, but they will have to get used to lean times for some time to come. Those that can survive it will do well in the long run, those that cannot, well, cannot, which apparently explains some predictions for massive bankruptcies in 2009 and 2010 in the retail sector. If you have returns to do, the sooner the better as January is a big month for retailers filing bankruptcy. Undoubtedly they are waiting to see if a good holiday season helps bail them out. Well, this year it ain't likely, so get ready.

The good news is that at least some U.S. consumers are hunkering down and doing some deleveraging. Consumer debt reached an all time high a few months back in relation to income and we must, I repeat must, stay within our incomes. Americans need to pay down personal debt and increase savings. Doing so will be a painful exercise for both the consumer and retailer, but it is a necessary evil.

Now I am not saying all these consumers suddenly woke up and learned how to be frugal overnight. I suspect most simply are at a point where they are given no choice. Credit card limits are being reduced, home equity lines are gone and incomes are being reduced. Without credit or cash you are really given no choice but to spend less. Some day folks may thank the credit card companies for reducing their credit lines or their mortgage company for eliminating the home equity line. That may be hard to imagine now, but some day they will be better off because of it. Until then, most will have a few choice words for their banks.

Then again, the market was up Friday, so go figure. Bloomberg attributes it in part to GMAC qualifying as a bank and, accordingly, qualifying for government aid. Given the very thin trading volume Friday, I would try to avoid reading too much into this either way.

Disclosures: None.

Source: Expect Retail Bankruptcies in January