Tale Of Two Christmases

(CBS)  It's a Charles Dickens Christmas -- a Tale of Two Economies.

High-end retailers such as Neiman Marcus and Tiffany are thriving, while discount chains such as Wal-Mart are suffering, reports CBS News Correspondent Trish Regan.

Recent sales figures from the nation's largest retailers underscore the growing gap between the haves and the have-nots.

Wal-Mart missed its November sales numbers, posting a meager seven-tenths-of-a-percent gain over November, 2003. The company had expected 3 to 4 percent sales growth. City saw a 3 percent decline in sales last month, and K-Mart's sales are likely to drop 10 percent.

"You have wealthy consumers spending in unprecedented proportions and the cash and credit starved consumers are suffering," says retail analyst Burt Fleckinger of the Strategic Resource Group.

Why are lower income consumers suffering? Gas prices and home heating costs are up 30 percent from last year, Regan points out, taking $1 billion from Americans' pocketbooks every week. And with interest rates at their highest level in three years, consumers are feeling the pinch.

One K-Mart customer told Regan, "Things are tighter this year." Another said, "I'm watching what I spend."

"Consumers are tapped out," Fleckinger says. "They're spending about 20 percent more to cover their credit interest rates. They've spent the money on home refinancing and they are not getting several hundreds dollars back from the government this year."

With those extra cash infusions such as tax rebates gone now, it's only the wealthy who have real spending power, Regan observes.

One Shopper at Tiffany summed it up simply to Regan: "I've spent a lot of money this year."

Thanks to high-end shoppers, overall retail sales are expected to increase 4.5 percent this year, to $220 billion — good news for luxury stores, but this year, just coal in the discounters' stockings.