Excellent article in Market Oracle. Search "The Retail Economic Death Rattle".
- number of visits to retail stores has plummeted by 50% since 2010
- credit card debt outstanding is 7% lower than its level in 2010 and 16% below its peak in 2008
- real median household income 8% lower than it was in 2008
- average gasoline prices in 2013 were the second highest in history
- since 2000, working age population has risen by 16% and the number of employed has risen by only 5.6%
The era of frivolous spending on trinkets and gadgets is over. Much hay is made of young people spending a lot of money on smartphones, but they don't spend much on anything else. Margins will continue to get squeezed until retail chains can no longer sustain themselves and disappear.
Yeah I read it and you can bet the writer is probably short the retail index. At this point there are so many articles in both directions and they are usually pushing their book. When RSH finally folds and other small players disappear BBY may be the last man standing on a national level that's the other side of the story. All stocks are in the grasp of this correction and who knows how long it will last. BBY shares were trying to recover the past few days but sellers and machines took almost everything down today. This may be a tougher short at these levels for now until earnings in about a month. You might figure most of the bad news is in for now but who knows. It did lose more than 35% in the two days after the update. Most of us here knew in our hearts that $44+ in November was a joke but maybe $24 was overdone we will see.