Taylor Swift may go back to December all the time, but this particular December could be even more poignant than a break-up for her.

This weekend will mark the final shows of the pop star’s globetrotting Eras tour, which has lasted a marathon 21 months. It’s a sad week for Swifties, but a good time to reflect back on the sheer economic heft of the tour, which wielded the power to single-handedly drive up nations’ inflation rates.

Everything Has Changed

The scale of the Eras tour is unprecedented. It smashed records a full 12 months ago when it became the first music tour ever to gross more than $1 billion, according to Pollstar. On top of that, the accompanying Eras tour movie that came out in October 2023 became the highest-grossing concert film of all time, breaking a record set by Michael Jackson in 2009. 

Beyond filling the pockets of Tay Tay and her collaborators on the tour, Eras exerted an economic center of gravity wherever it went. In September 2024, six British members of parliament put forward a motion to recognise the impact of the Eras tour on the UK economy. “This House acknowledges the substantial economic impact of Taylor Swift’s Eras tour on the UK economy, with an estimated boost of nearly £1 billion ($1.3 billion),” the motion reads, adding that it: “notes the concept of Swiftonomics as a demonstration of how cultural events can drive significant economic activity across multiple sectors, including hospitality, retail, and transportation.” 

But Swiftonomics did come with a downside for some countries. Wherever Swift went, inflation followed in her wake:

• Swift’s arrival in Sweden in May of this year caused the country’s core inflation rate to tick up for the first time in a year. The inflation wasn’t contained to strictly concert-adjacent sectors like hotel rates or air fares; it hit the price of clothing and food as well.
• Tourflation isn’t a purely Swiftian phenomenon, as tours by Beyoncé and Bruce Springsteen have also shown signs of bloating price growth.

Bullseye: At least one retailer is praying there’s still some juice left in the Eras tour. Target is exclusively selling the official Eras Tour book, at $39.99 a pop. The combination of the two economic forces that are Taylor Swift and Black Friday is potent — and perfect timing for Target, which suffered a dizzying 21% drop in its share price in mid-November following some severely underwhelming third-quarter earnings. 

For practical economic reasons related to his being a mythical figure, Santa’s generosity is capped by consumer sentiment. This year, his North Pole workshop is mighty busy.

Initial data from Adobe and Salesforce suggest, despite fears of skittishness, US consumers poured a record amount of cash into online retail on Black Friday. Coupled with other indicators, that suggests financial markets are poised to close the year with a bounteous holiday spirit.

Fairy Retail

Adobe estimates Americans spent $10.8 billion on online Black Friday purchases, up 10.2% year-over-year – and that’s on top of $6.1 billion spent online on Thanksgiving Day, which was up 9% over the same period. Salesforce estimates an even greater $17.5 billion spend on Friday, up 7% YoY. Sales growth at brick-and-mortar stores was more muted, at just 0.7% YoY, according to preliminary estimates by Mastercard.

Overall, the numbers bode well for the National Retail Federation’s forecast that winter holiday spending will grow 2.5% to 3.5% this year — to between $979.5 billion and $989 billion, compared with last year’s $955.6 billion. It’s also a good sign for retailers who will welcome the news — like Walmart, which topped Wall Street’s revenue estimates in the third quarter and saw its share price rise 11.8% in the last month — and others who needed the news — like Target, which missed analysts’ expectations in the third quarter and saw its shares fall 11.4% in the past month. The markets will also appreciate the apparent consumer optimism after a blockbuster November:

• The S&P 500 and Dow Jones Industrial Average scored record closing highs during the shortened Black Friday session, their respective 53rd and 47th record closes of the year. The S&P 500 gained 5.7% and the Dow 7.5% in November in one of the best months of the year for investors.
• It’s not just the Blue Chip indexes in a post-election, pre-Christmas boom: the Russell 2000 small-cap index was up 10% in November, its best month since December 2023, and the S&P Mid Cap 400 rose 8.7% for its best month since June 2023.

Fortune Teller: The S&P 500 has gained 27% this year. In the years where the index has gained more than 20% through November, it has risen 76% of the time in December for a median gain of 2.1%, according to Ned Davis chief US strategist Ed Clissold. In a note to clients last week, Clissold said the last time the S&P declined in the final month of the year after a 20% gain through November was 1996.

Ignore the high-profile exodus of users to BlueSky and Meta’s Threads. Elon Musk’s X, née Twitter, is doing just fine.

At least according to Fidelity, which marked up the value of its X holdings by 32% in October, according to reporting from Axios this weekend. Could it be due to the rise of xAI, a sister company in the Musk empire? 

xAI Marks the Spot

Fidelity helped back Musk’s $44 billion Twitter takeover in 2022, and in the time since, it has continually marked down the valuation of its stake as high-profile advertisers have fled the site for more corporate-safe pastures. Even with the October markup, Fidelity still sees its position in X as worth 72% less than when it first got involved.

But now the tide may be turning. Musk has emerged — for now at least — as a key ally of the Trump 2.0 administration, placing X closer to the center of political culture. Meanwhile, the EV-solar panel-satellite-social media mogul has gone all-in on growing his artificial intelligence firm, xAI. Last month, sources told The Wall Street Journal that the firm scored a $5 billion fundraising round at a $50 billion valuation, more than double its value from earlier this year. And it’s slowly becoming clearer that the fate of X and xAI may be closely intertwined:

• According to Axios, X Holdings itself may have an equity stake in xAI, which could help explain Fidelity’s X markup. Separately, Musk has promised his X backers a 25% stake in xAI — a giant, delicious cherry on top of their melting social media sundae.
• Meanwhile, Musk’s ascent in Washington will likely see major corporate sponsors increasing their ad budget allocations to X as “political leverage,” one marketing consultant told the Financial Times last month. Speculation remains that Musk could ultimately merge X Holdings with Trump Media Technology Group.

Injunction Function: Musk certainly sees the rise of xAI as a race against industry first-mover OpenAI, where he served as an initial backer and member of the board of directors until resigning in 2018. Over the weekend, attorneys representing Musk and xAI filed a preliminary injunction against OpenAI asking a federal court to stop the company from re-organizing as a for-profit organization (xAI is for-profit). Musk’s attorneys also alleged OpenAI engaged in anticompetitive behavior when it asked investors not to back rivals.