Futures are looking a little higher this morning, but traders are tentative after yesterday's smacking. For those who weren't paying much attention after the long weekend, Monday was all about a reversal of fortune for the battered gold bugs and momentum fliers.
The S&P 500 (^GSPC) was down more than half of a percent but the real pain was in tech. Specifically Apple (AAPL). The most important stock on Earth had its worst day in months, trading in an 8% range and closing more than 3% lower. The whacking put the Nasdaq (^IXIC) under some pressure, at least for the near-term.
This being December the best tell for how serious the pain could get is going to come from the consumer. Yesterday's morning meme was the largely discredited reports of a disastrous Thanksgiving sales week. The economic tourists who come into retail every year were out in force arguing that real consumers are suffering and retailers have shot themselves in the foot.
This raises a delicate point. For a bunch of reasons having to do with the darker urges of the human mind, there's a tangible hunger for proof that other people are suffering. The populist argument is that upper-crust "one-percenters," presumably dressed in top-hats and spats, are doing all the big living while regular Joes suffer.
Class warfare makes for an awesome narrative but the data doesn't really back it up. Two cases in point just from today. First we have a Gallup poll showing the self-reported level of spending in November rose to $95 a day last month. Yes, the fancy-kids spent more, but spending was up in the lower end as well.
We're also going to see signs of optimistic consumers when we get auto sales this morning. Specifically look at the mix of trucks and SUVs over smaller cars. Sales are expected to be stronger than any November since 2001 and 52% of the vehicles sold are trucks. That's up from 47% last year.
Even grouse pieces about the strapped consumer are emphasizing the increase in spending on Internet at home and on devices. Trucks and Netflix (NFLX) are pretty discretionary items for people supposedly so strapped.
The truth is things just aren't so bad. They aren't great, either. When times are generally good and news is slow you get extreme headlines. The trade is to take the other side. In this case that means betting that Santa is eventually going to show up, no matter how naughty you think rich people have been.