In his introductory comments regarding the nascent economic recovery, Kyle said:
Gone (hopefully) are the days of conspicuous consumption as sound personal finance principles come back in fashion.
While I am equally as hopeful that the economy has indeed turned the corner, I'm not so sure that we, the people, have really changed.
When surfing TV last night, I noticed there are as many silly shopping channels as ever. Surely, if we had mended our spendthrift ways and sworn off late night calls to buy the latest in vegetable-fashioning technology, there would be fewer channels hawking the stuff.
I decided to create a metric for conspicuous consumption, or at least, The Index of Completely Useless Stuff (TICUS) comparing total revenue at QVC to the S&P 500 index over the last few years.
I pulled the QVC data from the annual reports of its parent company, Liberty Media (NASDAQ:LINTA) for the years 2004 - 2009 and normalized it to the 2004 revenue. I did the same for the S&P 500 index. QVC sales track the S&P remarkably well for the good years of 2004-2007. It looks like we spent 2008 doing a little shopping therapy.
Full disclosure: No positions. And should you buy the QVC tennis bracelet (I don't know why you would), I do not receive a commission.
Tip of the hat, also to Ironman at Political Calculations who picked my post on Dollar Cost Averaging as The Best Post of the Week, Anywhere! Grazie.