One is that we are having to become accustomed to saving a higher proportion of our income partly because of greater job insecurity and

One is that we are having to become accustomed to saving a higher proportion of our income, partly because of greater job insecurity and the changing age structure of the population These changes have been widely discussed. This is the new normality.Quite aside from the forces noted above, there are two big changes taking place at the moment in the way we organise our finances. Sure, we can explain this oddity whereby decent growth in retail sales does not show in crowded shops But there may be a further message. This Christmas may seem different: but so will Christmases in general in the future. Eventually, most Lottery money will be recycled into the economy, but for the moment, it has the effect of cutting our spending and increasing our saving.This prompts a further thought.

Some of that maycome out of savings; some may have been diverted from the pools or the horses And some of the winnings will be spent straight away. But the weekly "take" rose during the first two weeks of this month and, according to the investment bankers Goldman Sachs, if this growth is maintained, retail sales in December could be as much as 1.7 per cent below the level they would otherwise have been. That is enough to have an enormous effect on the profitability of shops. But it also translates into insecurity among retailers: what new ideas must they come up with to secure the punters' interest? That is new for this part of the cycle. Forgive the traders if they do not feel like celebrating.All this would be enough to account for a "feel-bad" Christmas as far as the shops are concerned, but there is a further new factor operating at the moment: the National Lottery The Lottery was taking around £50m a week during November. This translates most obviously into the pre-Christmas label saying"40 per cent off", or "free credit".

Certainly, in consumer electronics not only is quality racing forward, prices are plunging, too. At any rate, the changes in price are now so small that consumers need feel no rush to buy, and may benefit from holding back.This changes the relationship between buyers and sellers. If buyers feel no need to rush, sellers must do more to entice them: they have to work harder to obtain the same volume of sales. Retail prices overall may be rising at 2 per cent, but if you allow for improvements in quality that is just about equivalent to no price increase at all. Result? Less crowded shops again.Third, there is the complex (and still not properly understood) impact of zero inflation. Much has been made of the fact that new out-of-town shopping centres kill shops in the high street, and they do certainly take custom away. But it takes a while for such shops to decide to close and since sites may be re-let, it takes even longer for existing retail space to be taken out of commission So much of the new space is additional space.