China's Impact on U.S. Retail
Although the initial picture emerging from the Chinese indicates that the outlook for China to lead a global recovery is good, there are key issues that have emerged among trading partners that could impact a broader recovery. Primary concerns include the Yuan's value, trade protectionism, slumping demand worldwide and the U.S. savings rates.
The darker side of global trade, particularly for the CE industry, includes shifting consumer attitudes and their tolerance for debt. It's important to note that consumer-spending adjustments create disruptive ripples throughout the world economy. While China has enjoyed a domestic boom, based on such items as household appliances, many consumers in countries such as the U.S. have become more cautious and conservative in their buying habits.
What is of paramount interest now is the American consumer's shift to higher savings rates. There has been exhaustive study of U.S. consumption patterns, particularly in the CE sector, and many of the results have focused on product price and quality, access to credit, and consumer confidence. Adding the U.S. saving rates and impact on the China-U.S. to that equation yields interesting new data.