iBankCoin
18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
15,629 Blog Posts

Retail Stocks Are Consumed by Misery and Loss

Does anyone shop anymore? I’m fine with the market ignoring this huge blight in the American greatness narrative. After all, consumerism kills more people than cancer, so I’ll never pretend to be a fan. But the trends in front of our faces speak volumes as to where this economic landscape is heading, a place festooned by warlords and rolling balls of hay — amidst tumult, war, death and destruction.

Happy Monday.

Retail stocks are plummeting today, off by 3% on zero new news. For the year, losses are in excess of 15% with some companies down much more.

It’s very convenient to blame $AMZN on everything, idly suggesting that all of the loss revenues have shifted to her.

(Adjusts microphone)

WRONG.

The revenues are simply lost. Americans are consumed by student loans, car loans, and healthcare, beguiled by their stagnant wages.

Prove me wrong.

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16 comments

  1. mx2101

    In addition to your point, I think the folks’ downtime is consumed by social media, and the cost associated with it. No need to be seen at the mall anymore.

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  2. heaterman

    Unfortunately I think your theory is correct and retail is the canary in the coal mine.
    There is very little disposable income for those earning <$100k.
    Given a huge part of the population is even <$50k , general retail will continue circling the drain.

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  3. matt_bear

    every time i step into a TJX or Marshalls the check out line is packed.

    to your point though, the success of TJX comes at the overall expense of the retail sector’s margins.

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    • bob smith

      Most of what I see in brick and mortar stores are EBT people or lazy people. EBT cards cannot be used on Amazon or else they would even steal that shopping cohort. I only buy fresh food (meat, milk, fruit/vegetables) at stores. Everything else is online. No taxes in most cases, no outrageous mark-up, no waiting in lines. Even clothing and shoes… I try them on at stores and buy them online when I know what I want (often at 20% – 80% discounts compared to retail).

      I suspect that when AMZN figures out how to deliver fresh food, even Walmart will go the way of JCP.

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  4. qeinfinity

    Inflation in education and health care have both greatly outpaced general inflation. Meanwhile, median income has gone nowhere in 20 years. I wouldn’t bank on retail recovering anytime soon.

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  5. fryguy15

    It’s a compounding issue… Debt slavery, healthcare costs, expensive housing, and migration back to city centers from suburbs are all contributing. These shifts led to the new trend of minimalist, inexpensive wares. Also agree with @mx above… malls used to be places to hang out and meet with others, and no longer needed for that purpose given social media.

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  6. dragun

    The crazy thing is in Canuckistan they continue to build out power centers.

    Not sure where the cash comes from to support the retailers.

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  7. bruce keller

    DB is rearing its ugly head again. I wonder how much longer it can go before Lehman’n?

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  8. stockslueth

    Consumed by Tweeting, Facebook, gaming, experiences, etc. Retail shopping is so yesterday.

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    • ferd

      I wish. A majority of women feel like they’ve scored when they buy stuff that they touch at a store. They feather nests with junk. They also ‘make’ money by shopping …the math goes like this: ‘it was 30% off, so I made 30%.

      Select clothes and other soft goods stores will do fine after shaking out some of the men’s lines.

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  9. no_logic

    Think the next crisis is brewing on the retail front? The numbers don’t lie, AMZN or not, and retail is a huge employer with regional banks on the hook for a lot of the real estate…..

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  10. soupbone

    Want to see how cheap folks can live? Head to rural. $500 per two years for clothing will more than suffice. Massive freezers with food bought under the radar. Everything is under the radar as barter removes the gov’ment. And in the country nobody narks on their neighbour ever.

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  11. masteroneass

    Right on. All these places can’t give this cheap chinese stuff away. The sad thing is the stuff is so damn cheap now we should be buying more of it. That being said how is Trump going to make a “fair trade” when most of what we are losing on is to Japan / Germany – Cars (we make cars – people just like buying German and Japanese ones) and cheap Chinese consumer stuff (you can’t jack up the price of the product coming in 100 percent because the retailers will either have to take less of a profit or we would just be better off producing them here even though we can’t even afford the stuff in the bargain bin anymore). Plus AMZN / BABA give zero fucks and are just undercutting the hell out of everyone. The rest is a small amount of oil.

    You see the deficit / fair trade is entirely the consumers fault. People can buy American cars, and before Walmart we used to make things that were slightly more expensive but much more durable. Go figure. You are right retail is toast. It was a bubble. Nobody cares about brands here and they only buy when it is deeply discounted. Recovery highly unlikely. But it might give rise to technology where we make the cheap chinese crap with automation. No big deal they weren’t jobs to lose in the first place we already lost them. But it might give rise to technology jobs. Maintanance, Engineers etc. I see the big D is already trying to make automated trinket making machines and clothes for their Magical Worlds.

    Its called JOS A BANK times 50.

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  12. jsal56

    I think Trump wants a trade war, maybe Trump is right to ignore the cucks at National Review, Rush and other places that shout Smoot Hawley endlessly, maybe Smoot was not he cause of the Depression and it may not be a bad idea to tax imports and make everybody dumping their stuff here pay- until we retool to make stuff here.

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