Retailers who maintain that we are living in a plastic world point to consumers who plunk down credit cards while uttering the mantra “Buy now, pay later.”

A new study finds that 53 percent of purchases in the nation’s stores are taking place with credit or debit cards, or other forms of plastic. But are consumers getting ready to abandon such spending fervor?

In August, Americans, hard-hit by soaring gasoline prices, cut back on their borrowing by the largest amount in nearly 14 years. The decline was at an annual rate of 1.4 percent.

Which brings us to Friday’s report of September retail sales. Chicago economist Brian Wesbury says consumers aren’t ready to assume the role of shrinking violets. He is looking for a solid gain of 0.7 percent, fed largely by booming sales of cars and light trucks.

“Carmakers had early introductions for some models, and they still were clearing out the last of the “04s,” said Wesbury, of Griffin, Kubik, Stephens & Thompson, an investment firm.

Despite an impression that gasoline prices have slowed activity, the last three months have seen overall buying levels well above those of this year’s second quarter, he said.

“When the results are totaled, we are likely to see a growth rate of gross domestic product for the third quarter above 4 percent and perhaps nearing 5 percent,” Wesbury said. “A main reason: Consumer spending remains remarkably strong.”

Get ready Thursday for a less-than-stellar report on the August trade deficit, after a steep $50 billion shortfall a month earlier.

Chicago economist Robert Dederick is looking for a figure of about $52 billion, evidence that “the trade gap continues to creep higher, in an irregular pattern.”

Exports are growing, providing a modest boost to jobs in manufacturing, but imports are expanding faster, said Dederick, of RGD Economics.

“It’s a difficult situation. It tells us Americans must run to stay even,” he said. “A growing economy gives us a huge propensity to import more goods.”

The question, Dederick added, is whether foreigners will indefinitely remain willing to finance the resulting mountain of debt.

“We are involved in a mutual admiration society with China and Japan,” who are accepting boatloads of American IOUs, he said. However, Europeans are showing a bit of reluctance to stay in the game.

The Federal Reserve will be closely watching Friday’s report of the September producer price index, for further signs that commodity pressures are spilling over in the direction of finished goods.

Huge jumps in the prices of oil, steel, copper and other basic materials have placed members of the Fed on notice.

Economist Robert Gay of Commerzbank Securities is looking for only a modest 0.2 percent advance in the wholesale inflation index, explaining that “rising oil prices should lead the headline PPI higher, but the core rate is likely to reflect that inflation will remain well contained.”

After remaining in low gear through the first nine months of 2004, some analysts are calling for the stock market to shift into the fast lane between now and year’s end.

But first, Wall Street must successfully steer past a mountain of news about third-quarter corporate earnings, due out over the remainder of October.

Chicago investment manager Marshall Front says profits should be up by about 15 percent, with another double-digit increase expected for the fourth quarter.

“While corporate earnings have surged this year, stock prices have failed to follow suit,” said Front, of Front Barnett Associates. “A similar divergence occurred in 2002, only to be corrected by the stock market’s 28 percent rise in 2003, as war fears and corporate scandals receded.”

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(c) 2004, Chicago Tribune.

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