The Tower Group expects gift card sales to drop 7% from last years sales, which are down from 2008 levels. Even the National Retail Federation reports that gift card spending will drop this holiday season. Most commonly cited reason: gift cards are too impersonal.

And the Wall Street Journal and Time Magazine (among many others) feature articles (WSJ, Time) that advocate giving cash instead of gift cards. Have gift cards peaked? Are consumes getting smarter?

Strangely though, Canadians seem to be giving more gift cards than ever.