Published on December 13, 2023

Black Friday Sets Consumer Spending Records

Despite continued pessimistic forecasts and surveys suggesting that consumer confidence is waning, recent data suggests the U.S. consumer is continuing to splurge. With a growing disconnect between spending and confidence, what’s next for U.S. consumer spending?

Consumers are still spending

Black Friday sales surpassed last year’s record numbers and analyst expectations despite conflicting reports about consumer sentiment.

A significant portion of consumer spending in the United States occurs from Thanksgiving to Christmas. Kicked off by Black Friday and Cyber Monday sales, this period is crucial for retailers. It is characterized by increased consumer spending on gifts, decorations, food, travel, and various other holiday-related expenses.

This year was no exception. Beginning on Thanksgiving through Cyber Monday, over 200 million U.S. consumers indulged, surpassing last year’s record of 196.7 million and exceeding the initial expectations by over 18 million shoppers. Brick-and-mortar shopping returned, with approximately 121.4 million people shopping in person and 134.2 million purchasing online.1

Expectations for this holiday season are for record sales close to $1 trillion, and with this growth comes a need for more workers. Expectations are for retailers to hire between 345,000 and 450,000 seasonal workers for the season.1

More shoppers, more spending.
Thanksgiving Weekend Shopping Over the Years

Consumer Spending: Thanksgiving

Source: National Retail Federation (NRF) and Prosper Insights & Analytics, Nov. 28, 2023.

Consumers are doing more than spending; they’re splurging

As evidenced by the mania over the Taylor Swift tour, which could become the highest-grossing tour of all time,2 U.S. consumers have increasingly spent more money on going out and experiencing attractions and destinations. Per the chart below, the share of retail sales (excluding autos and gas) spent on restaurants made up 15% of retail spending during the October-December holiday period in 2022 vs. a low of 11% in 2020 and the pre-pandemic average of 13%.3

Share of SpendingPulseTM US retail sales (excluding auto and gas), October - December

Consumer Spending: Retail

Source: MasterCard. Holiday Spending 2023.

A mixed consumer picture

Given the increased amount of spending, one would expect heightened confidence and sentiment. However, Americans are increasingly concerned about inflation — according to one survey, 50% of U.S. adults said their overall financial situation was worse than it was three years ago.

These findings aligned with the University of Michigan Surveys of Consumers4, Consumer Sentiment Index. In November, consumer sentiment fell by 2.5 index points, or 4%, from October, marking the fourth consecutive month of declines. But November's reading also reflects more favorable current assessments and expectations of personal finances, which were offset by a notable deterioration in expected business conditions. Consumers seem to be most concerned with long-run business conditions, which fell by 15%, the lowest since July 2022.

Index of Consumer Sentiment
(Monthly and 3 month moving average)

Consumer Spending: Sentiment

Source: University of Michigan, 2023.

Another commonly followed consumer index is the Conference Board Consumer Confidence Index®5, or CCI. The CCI is based on a survey of 5,000 U.S. households, as opposed to the smaller set from the University of Michigan Consumer Sentiment Index, which surveys around 500 consumers. The Present Situation Index assesses current economic conditions, and the Expectations Index gauges consumers' outlook for the future.

The headline numbers showed a positive picture, but a deeper look is more concerning. While the Consumer Confidence Index rose in November, the Present Situation Index dropped slightly, and the Expectations Index remained below 80 for a third consecutive month—a level that historically signals a recession within the next year. However, the Expectations Index rose to 77.8 in November from 72.7 in October.

Are U.S. consumers going into debt to continue splurging? A new buzz phrase — “doom spending” — has emerged to describe Americans shopping to cope with the anxiety and stresses of the economy. A survey of 1,000 adults showed that approximately 32% had taken on more debt in the last six months due to their spending habits.

The consumer’s impact on the economy

U.S. consumer spending is the driving force of the American economy, comprising two-thirds of the U.S. economy on average. Consumer spending is a key influence on this growth, propelling the economy’s annualized growth rate for the third quarter to 5.2%, higher than the initial estimate of 4.9% and more than double the 2.1% seen in the second quarter.6

For the third quarter, personal consumption increased at an annual rate of 3.6% compared to the preceding quarter, representing nearly 68% of the nation’s GDP. Much of that spending requires financing, some for bigger ticket items like homes, automobiles, and higher education and some in the form of credit card debt for day-to-day purchases.

With the potential for a Goldilocks recovery, consumers may continue to keep spending. And while certain sentiment indices are pointing down, a deeper dive shows that consumer purchasing power has improved.

Debt service ratio measures debt payments as a percent of disposable income. Looking at this ratio for U.S. households shows debt service levels returning to normal after a very low level last year.

While the typical U.S. consumer’s balance sheet is slightly less favorable than last year’s holiday shopper, it is still a healthy backdrop. Indeed, on aggregate, their debt service ratios are back at levels seen from 2010 - 2019.

US household debt service ratio (%)

Consumer Spending: Adapting to a Changing Regulatory Environment

Source: Federal Reserve Board, Haver Analytics.

Investing in consumer spending


  • Consumer discretionary stocks include retail, automotive, travel and leisure, and entertainment companies. Consumer discretionary spending tends to be more sensitive to economic conditions, and these stocks are often more susceptible to economic cycles.
  • Consumer staples stocks produce essential goods and services that consumers typically buy regularly, regardless of economic conditions, including companies in the food and beverage, household products, and healthcare industries.
  • Consumer credit stocks include banks, credit unions, credit card companies, and fintech providers that specialize in providing financing solutions for consumers, particularly in auto loans, personal loans, and installment financing.


Aside from traditional equities, fixed income issues of consumer discretionary companies or other companies levered to the U.S. consumer are another way to invest in U.S. consumer spending.

  • Asset-backed securities (ABS), such as credit card-backed securities and auto loan-backed securities, where investors receive payments based on underlying consumer debt.
  • Real estate bonds for retail spaces or malls.
  • Corporate bonds from consumer finance companies, collateralized loan obligations (CLOs), and mortgage-backed securities (MBS) with consumer-related loans.


Despite record consumer spending, sentiment on the consumer remains mixed. In environments with a divergence between data and public perception, there are likely compelling investment opportunities and mispriced securities. Crystal Capital Partner’s Platform offers their clients the opportunity to construct a diversified portfolio of institutional hedge fund managers that can invest along these consumer themes and potentially uncover mispriced securities or private market managers that can offer capital or financing to consumer businesses.


  1. NRF. 2023 Holiday to Remember, Nov. 2, 2023.
  2. Billboard. Taylor Swift's Eras Tour. Nov. 29, 2023.
  3. Mastercard. Holiday spending 2023.
  4. University of Michigan Consumer Surveys. Nov. 2023.
  5. U.S. Consumer Confidence. Nov. 2023.
  6. Gross domestic product. Q3. 2023.

See the private funds investing in the U.S. consumer.

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