Best Buy Co. (NYSE: BBY), which recently gave a dire prediction about the state of its future sales, has decided to cut back on the amount of inventory carried in each store during this holiday season, as it weathers the consumer spending downturn caused by the current economic recession.

Many industry titans have indicated that this is the worst retail environment they've ever seen, and that list now includes Best Buy President Brian Dunn. Dunn indicated that the speed and depth of the recession caught the consumer electronics retailer off guard and by surprise. As a result, the retailer is curbing television commercials and is doing more to pump its lower prices through email and cheaper marketing methods.

Although Best Buy is now offering zero interest for 18 months on all purchases $499 and up, that's not good enough. If Best Buy really wants to get feet in the doors -- even in a recession -- it should offer no interest financing for all purchases above $19.99.

That's right, anything from the price of a new DVD on up. Trying to push sales of its recently-unveiled and overpriced Blue Label goods won't cut it. It should pull those goods until the recession has ended and re-introduce them. Customers aren't looking for products created with their opinions in mind. Right now, it's all about price.

Almost everyone expected that September was a rough month, but a survey from Mastercard (NYSE:MA) shows that it was much worse than expected.

According to Reuters, "Not one spending category posted positive gains over last year, according to the report by SpendingPulse, the retail data service of MasterCard Advisors." The poll looks at everything from clothing to furniture sales.

The hardest hit sector may have been electronics and appliance sales, which were off almost 14% for the month.

While the news is likely to put further pressure on retail stocks and may lead to layoffs in that industry, it also shows how slow the federal government was to get into the act of helping the economy. But refusing to cut interest rates or increase the amount of money being pushed out to banks through its emergency funding window, the Fed made it almost certain that consumer credit would be undermined. The Fed's new program to expand the aid it give to banks comes too late.

The holidays will be hard for retailers, perhaps the worst they have been in decades. The Fed may not have saved Christmas but it could have gone a long way to soften the blow.

Douglas A. McIntyre is an editor at 247wallst.com.

Gone are the days of holiday shopping in crowded malls and retail stores, it's all about point-n-click these days. Well, at least somewhat. With there still only being 24 hours in a single day and more stuff than ever to keep us all busy, online shopping is turning into a mainstream mode of buying products and services for people globally. Online shopping has been around for a while, you might say. You're right but in Britain, online shopping is expected to explode even further, tripling by 2011 according to a new survey.

Will that prediction come true in the U.S.?

Hard to tell, but online spending is speeding up by all measurements. Although the social aspect of shopping in person has quite a bit of weight behind it, online shopping is more conducive to the "time" variable these days since we have less of it than ever before. There are some retail purchases that will always require a personal visit -- but for quite a bit of shopping, nothing beats the convenience (and sales tax avoidance, if that's your thing) of online shopping.

One area that still has not taken off in the U.S. is food retailing over the web. Sure, you can buy quite a few items from Amazon's grocery section, but the experience is nothing like grocery shopping in person and fresh items like produce and meat aren't offered. Once that can be duplicated and the logistics can work -- which is a COO's nightmare -- nationwide online grocery shopping may become a reality. In my world, that's one of the last bastions left standing right now that still has not been fully attacked.

Wasn't eBay Inc. (NASDAQ:EBAY) supposed to be driven out of business by now by a combination of Google Inc. (NASDAQ:GOOG) and sellers irate about fee increases?

Guess what? eBay isn't going anywhere. Reports of the demise of the world's largest Internet auction site were GREATLY exaggerated.

Google, which has been heavily promoting Google Checkout, has proven at least for now not to be much of a threat. PayPal's revenue rose 37 percent, helped by the rebates and free shipping offers. Listings were even up which got me wondering what happened to the mad sellers. Did they leave and get replaced or did they leave and come back?

eBay not only posted better-than-expected fourth quarter results and boosted its profit forecast, it also announced plans to buy back as many as $2 billion in stock. Meg Whitman has sure got some nerve having a good quarter instead of selling off eBay to the highest bidder.

Wall Street missed the boat on eBay's popularity with gamers and its growth prospects in Europe. The company was smart to buy StubHub, a deal which makes tons more sense than the acquisition of Skype.

But shareholders shouldn't breathe easy just quite yet. Google may eventually figure a way to compete against eBay which will drive the company into the arms of a suitor. eBay, though, doesn't seem like it's in that situation yet, not be a long shot.

Check out some other earnings reports that we're following, and let us know what you're expecting.