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Not So Merry Christmas

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Based on checkwriting, which represents about one-third of all retail spending, shoppers continue to hold back and remain value conscious. For the 24 shopping days of the 27-day holiday shopping period American consumers are spending about 50 basis points more this year than 1996. The data are based on same-store sales as reported this morning by TeleCheck Services. TeleCheck says the Northeast leads with a 4.4% gain while spending is off 2.1% in the Southwest.

FULL STORY:
With 24 days of the 27-day shopping period completed, consumer spending rose slightly over the same 24-day period a year ago, resulting in a same-store sales increase of 0.5 percent, according to TeleCheck Services, the world’s leading check-acceptance company.

Data are based on a year-over-year, same-store comparison of the dollar volume of authorized checks written by consumers at more than 27,000 of TeleCheck’s 167,000 subscribing locations. Checks account for more than one-third of retail spending. TeleCheck is a subsidiary of First Data Corp. (NYSE:FDC).

“In spite of vibrant economic conditions, holiday shoppers continued to hold back and remained very value conscious, taking advantage of retail promotions and deep discounts. With only three days remaining in the traditional shopping season, we would have to see a surge to significantly improve on last year’s same-store sales.

“With both Christmas and Hanukkah coming late in the week, and considering that two of last year’s top four shopping days fell immediately before Christmas, it is still possible that we will see a boost in spending,” said Dr. William Ford, TeleCheck’s senior economic adviser.

The Northeast led with a 4.4 percent gain. Sales rose 5.1 percent in New York, but New York City was down 2.0 percent. Massachusetts was up 2.9 percent, with Boston up 3.4 percent.

Sales in the Southeast rose 1.3 percent, with gains of 1.9 percent in Florida, 1.8 percent in Georgia, 0.8 percent in the Carolinas and 0.6 percent in Tennessee. Louisiana’s sales dropped 0.8 percent. Orlando’s sales gained 2.7 percent and Miami/Fort Lauderdale’s grew 0.1 percent, while Tampa’s dropped 0.3 percent. Atlanta’s sales rose 2.9 percent and Nashville’s increased 0.7 percent, but Memphis’ dropped 6.0 percent and New Orleans’ declined 2.3 percent.

The Midwest’s sales rose 0.7 percent, with Wisconsin up 2.1 percent, Ohio up 1.1 percent, Michigan up 0.7 percent, Minnesota up 0.5 percent and Illinois up 0.3 percent. Milwaukee’s sales gained 0.8 percent, Cleveland’s rose 2.9 percent and Detroit’s gained 1.7 percent. Sales dropped 0.5 percent in Minneapolis/St. Paul and rose 1.8 percent in Chicago.

The Mid-Atlantic rose 0.4 percent, with New Jersey up 0.4 percent. Sales dropped 0.7 percent in Pennsylvania, 1.0 percent in Virginia and 1.4 percent in Maryland. The District of Columbia`s decreased 1.6 percent. Sales dropped 1.4 percent in Philadelphia, 2.0 percent in Pittsburgh and 1.2 percent in Baltimore.

Sales in the West dropped 1.1 percent. Sales rose by 3.8 percent in Arizona, 1.4 percent in Hawaii and 1.2 percent in Colorado. Oregon’s sales dropped 0.8 percent, Washington’s decreased 1.0 percent and California’s dropped 1.3 percent. Sales rose 4.6 percent in Phoenix, 1.0 percent in Denver and 0.9 percent in Portland, but dropped 1.1 percent in Seattle. San Diego’s sales were up 1.7 percent and Los Angeles’ rose 0.2 percent, while the Bay Area’s dropped 1.1 percent.

The Southwest was down 2.1 percent. Missouri’s sales rose 0.4 percent and Oklahoma’s gained 0.1 percent, while Texas’ were down 2.0 percent. Sales were up 0.4 percent in St. Louis, but fell 4.0 percent in Kansas City. Oklahoma City’s sales rose 0.4 percent while Tulsa’s fell 4.2 percent. Sales rose 2.4 percent in Austin, 1.4 percent in Houston and 1.2 percent in Dallas/Fort Worth, but dropped 2.3 percent in San Antonio.

TeleCheck’s index is compiled on a calendar basis and is based on the total sales volume of check-writing consumers at a broad cross-section of retailers. Figures are not adjusted for inflation. Checks account for 37 percent of retail spending. In 1996, TeleCheck authorized more than $40.2 billion in checks and processed more than 645 million check inquiries.

Founded in 1992, Hackensack, N.J.-based First Data is a global leader in payment systems, electronic commerce and information management products and services. First Data and its principal operating units process the information that allows millions of consumers to pay for goods or services by credit, debit or smart card at the point of sale or over the Internet; by check, or wire money — seamlessly and effortlessly.

For more information about First Data, visit the company on the Internet at http://www.firstdatacorp.com.

Ford holds the Weatherford Chair of Finance at Middle Tennessee State University. Earlier in his career he was president of the Federal Reserve Bank of Atlanta and served on former Fed Chairman Paul Volcker’s Federal Open Market Committee.

             TeleCheck National Holiday Retail Sales Index
             Holiday Sales Index (Period:  11/28-12/21/97)
                              Dec. 23, 1997

NATIONAL                   0.5%

SOUTHEAST                  1.3%       WEST                  -1.1%
Florida                    1.9%       Arizona                3.8%
  Miami/Fort Lauderdale    0.1%         Phoenix              4.6%
  Orlando                  2.7%       California            -1.3%
  Tampa                   -0.3%         Bay Area            -1.1%
Louisiana                 -0.8%         Los Angeles          0.2%
  New Orleans             -2.3%         San Diego            1.7%
Georgia                    1.8%       Oregon                -0.8%
  Atlanta                  2.9%         Portland             0.9%
Tennessee                  0.6%       Washington            -1.0%
  Memphis                 -6.0%         Seattle             -1.1%
  Nashville                0.7%       Colorado               1.2%
The Carolinas              0.8%         Denver               1.0%
                                      Hawaii                 1.4%
SOUTHWEST                 -2.1%
Texas                     -2.0%       NORTHEAST              4.4%
  Austin                   2.4%       Massachusetts          2.9%
  Dallas/Fort Worth        1.2%         Boston               3.4%
  Houston                  1.4%       New York               5.1%
  San Antonio             -2.3%         New York City       -2.0%
Missouri                   0.4%
  Kansas City             -4.0%
  St. Louis                0.4%
Oklahoma                   0.1%
  Oklahoma City            0.4%
  Tulsa                   -4.2%

MIDWEST                    0.7%
Illinois                   0.3%
  Chicago                  1.8%
Michigan                   0.7%
  Detroit                  1.7%
Minnesota                  0.5%
  Minneapolis/St. Paul    -0.5%
Wisconsin                  2.1%
  Milwaukee                0.8%
Ohio                       1.1%
  Cleveland                2.9%

MID-ATLANTIC               0.4%
District of Columbia      -1.6%
Pennsylvania              -0.7%
  Philadelphia            -1.4%
  Pittsburgh              -2.0%
New Jersey                 0.4%
Virginia                  -1.0%
Maryland                  -1.4%
  Baltimore               -1.2%

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