It has been a confusing few weeks for followers of the retail sector. A mix of disappointing earnings (See Best Buy, J.C. Penny’s and Sears) along with pockets of luxury strength plus strongly trending auto sales has created a jumble. Let’s see if we can make some sense of the entire mess.

Let’s start with the tales of the American consumer’s demise. The early read from the National Retail Federation (You remember them) was for retail sales to drop 2.7% on Black Friday, and for gloomy holiday sales.  Well, they reported this week that holiday sales rose 4.6% year-over-year (with the caveat I have no clue what their methodology actually is).  A nearly 5% increase is not exactly a gloomy sales season. This is consistent with Morgan Housel’s claim that everything is doing much better than a few years ago and no one is happy about.


Continues here

Category: Consumer Spending, Data Analysis, Retail

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

3 Responses to “Discounts, Luxury Sales, and the Consumer (JCP, BBY et. al.)”

  1. rd says:

    On the retail side, keep in mind that the average age of a car in the US has increased to over 11 years:

    People may be spending more on Christmas presents because they are not buying cars. One of the big revolutions in cars has been the use of galvanized steel and synthetics in key chassis and body parts. As a result, cars in the Rust Belt are abel to last longer. Since the consumer disposable income has been anemic, consumers are taking advantage fo the increased lifespans by not buying new cars. We almost never replace a car before 10 years now.

    However, your report does indicate that supply side economics is working well. The Ferrari, BMW, and Bentley plants in Michigan and Alabama are at full capacity churning out lots of cars for the 1% thereby keeping the rest of America employed.

  2. thatguydrinksbeer says:

    There was an 11% yoy increase of the search term “gift idea”:

  3. Angryman1 says:

    Looks like the day of the big box retailer is over.