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Fall Forecast: The Consumer

If you drive, it’s hard not to notice that as your gas gauge moves toward full your wallet goes toward empty. Even with the recent drop in prices, gas remains a solid 33% higher than it was just one year ago.

But it doesn't stop there. The skyrocketing cost of fuel creates a ripple effect that leaves none of us unscathed. The price of an airline ticket jumped 11% between last November and February with fewer flights and oil surcharges.

And don’t forget what’s happening with food costs. Earlier in the month the U.S. Department of Agriculture said consumers should brace for the biggest increase in food prices in nearly 20 years!

So it comes as no surprise that many Americans are pinching pennies. According to a recent survey from Stifel Nicolaus more of us are feeling a significant impact from prices at the pump.

And as a result we’re spending less on DVD’s, home décor, jewelry and a number of other discretionary items, as the economists would say.

"I’m concerned about the consumer," says Stifel Nicolaus retail analyst David Schick on Fast Money. "Retail makes at least 40% of their profit during Holiday time and the best indicator of Holiday business is back-to-school sales, he adds. "Right now, it looks like back-to-school is going to be weak."

-(scroll down to learn where Americans are spending more)-

However, that survey contains a surprise. We’re planning to spend more on some things including big ticket items such as HDTV’s and computers.

If you want to trade that trend, Best Buy is probably the way to play it, explains Schick.

What do you think. Answer the Charles Schwab Question of the Day!

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Trader disclosure: On Aug 27, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (BTU), (C), (GS), (INTC), (MSFT), (NUE); Jon Najarian Owns (C), (JPM); Jon Najarian Owns (AAPL) And (AAPL) Calls; Jon Najarian Owns (ALF) Calls, (NTAP) Calls, (RMBS) Calls, (EWH) Calls, (UNG) Calls; Tatro Owns (C); Quint Tatro Is The Principal Of Tatro Capital; Tatro Capital Owns (FXI), (SHLD), (XHB), (XLF), (SMN); Tatro Capital Is Short (MON), (MOS), (POT), (RIMM); Terranova Owns (POT), (NOV), (SA), (GS), (KOL), (EOG), (VLO), (FCX), (RIMM), (AAPL), (X); Terranova Owns (AIG) Puts; Terranova Owns Dec. 2008 RBOB Gasoline Crack Futures

Terranova Is Chief Alternatives Strategist Of Phoenix Investment Partners, Ltd.; Phoenix Investment Partners Owns More Than 1% Of (ABD), (ARE), (BRE), (CNTY), (CLB), (OFC), (DLR), (ESS), (EXR), (FL), (IAT), (IGE), (LNET), (MAC), (OIIM), (PSPT), (DBC), (DBV), (SLB), (SKT), (BLV);

Terranova Is Co-Portfolio Manager Of The Phoenix Diversifier PHOLIO; Phoenix Diversifier PHOLIO Owns (IGE), (DBC), (DBV)

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