It seems even Amazon's not holding out hope that Christmas will make up for dwindling consumer spending. In its third quarter earnings yesterday, the online retailer predicted fourth quarter revenue would only be $6-7 billion, lower than Wall Street's $7 billion forecast and operating income would only reach $145-305 million.

FT: Tom Szkutak, chief financial officer, said the forecast reflected “appropriately conservative assumptions” and followed slower sales at the end of the quarter in September as consumers reacted to the turmoil on world financial markets.

The slowdown included a fall-off in the number of online purchases worth more than $1,000.

This is down from Amazon's previous Q4 estimate of $7.2 billion. Predictably, the market responded calmly, sending Amazon's shares down 14 percent in after-hours trading.

Meanwhile, even the National Retail Federation is forecasting a smaller increase in holiday sales.

The National Retail Federation is predicting Christmas sales growth of 2.2 per cent, the lowest level since 2002.

So much for those hopes that Christmas will save the economy. Indeed, the BBC notes that across the board, retail's indicating it won't be immune to the economic downturn.

BBC: The firm's warning of weaker trading conditions in the key festive period follows after similar announcements by Apple and eBay.

Taken together it is a growing sign that the crisis in the financial sector is spreading to a wider economic downturn.

"Amazon is definitely signalling much worse returns in the fourth quarter," said analyst Jeffrey Lindsay of Sanford Bernstein.

"This is further confirmation that the economic downturn is much more pervasive than was earlier thought.

"Online retailers were thought to be immune to it, but this is an indication that that is far from true."

We guess it's up to Halloween and Hollywood to save the economy now. So stock up on candy, in and out of the theater.