Sunday, December 06, 2009

Growth, the health of the economy depends on consumers, and consumers have taken a hit

SHOOT: Nobody gets this. In a consumer economy you need consumption to feed consumption, and how can that happen when jobs are being lost, energy costs are increasing and inflation is trneding upwards? We're not going to see a return to the way things were, the Happy Motoring lifestyle, the fast food and easy money mindset. What comes next? Contraction. Fewer choices. Less money. And forget about credit. For cars, or homes.
clipped from

America’s holiday shopping season will bring little yuletide cheer to ailing retailers

THINGS had begun to look better. In October, after a bad year for the industry, retail sales began to show signs of improvement, exceeding forecasts and rising 1.4% compared with the previous year. Even one of the most battered retailers, Saks, a luxury department store, announced a small profit for the year to the end of October. This spurred cautious hope of a revival for retailers. Much was pinned on holiday season shopping.

News of November sales, delivered on Thursday December 3rd, dampened any holiday cheer. Sales were up by only 0.7% in November in comparable shops compared to the previous year according to Retail Metrics, a research firm. Sales at Saks and Abercrombie & Fitch, a clothes retailer, were down by 26% and 17% respectively. Even discount stores, such as Target, did not live up to analysts’ forecasts.

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