From consumer and retailer surveys to quantitative data such as household spending and private jet bookings, ConvergEx's Nick Colas has amassed a collection of 10 clues about this year's holiday shopping season. On the plus side, disposable personal income and consumer spending on discretionary items are rising, and travel to Palm Beach via private jet is quite popular this Christmas season. However, consumer confidence surveys are particularly weak, and consumer debt has ballooned to a 5-year high. Roughly equal parts good and bad, Colas' collection of holiday spending indicators points to a mediocre (at best) 2013 shopping season (as we noted earlier).
... Wait, wait, wait. What do you mean Best Buy isn't releasing the next retinest, fingerprintscanniest, NSA-trackingest, 6-8 inchiest gizmo and instead these people are simply taking a 10 day break from their highly paid, quality jobs just to wait in line for a $98 TV?
- J.P. Morgan, U.S. Reach Historic Settlement (WSJ)
- OECD cuts global growth forecast (AP)
- Guess the profit margin: Wal-Mart Touts $98 TV as Holiday Seen Weakest Since 2009 (BBG)
- Republicans defy threat, block another Obama judicial pick (Reuters)
- Fed Ponders How to Temper Tapering Without Rate Increase (BBG)
- Wall Street uses 'merchant' workaround to cling to commodity assets (Reuters)
- PBOC to ‘Basically’ End Normal Yuan Intervention, Zhou Says (BBG)
- Italy’s leader warns Germany of rise of anti-European sentiment (FT)
- Yellen Nomination for Fed Chairman to Get Vote This Week (BBG)
- As U.S. default threatened, banks took extraordinary steps (Reuters)
- NSA vowed repeatedly to fix its collection errors (AP)
Over the weekend, in "Venezuela Government "Occupies" Electronics Retail Chain, Enforces "Fair" Prices", we reported that unpopular president Nicolas Maduro ordered the "occupation" of a chain of electronic goods stores in a crackdown on what the socialist government views as price-gouging hobbling the country's economy. Various managers of the five-store, 500-employee Daka chain - the local equivalent of Best Buy - have been arrested, and the company would be forced to sell products at "fair prices." Since then things have escalated rapidly. Because as we queried, and many wondered, the first question that arose is how would Maduro i) assure that prices were indeed kept at their "fair values" and ii) how would the cool, calm and orderly social order be preserved when suddenly everyone scrambles to buy all those flatscreens (which may have certain operational problems once the socialist paradise is hit with daily electric brown and blackouts very soon) they have been dreaming of for years. Now we know: with the help of the army.
- Less Tapering Becomes Tightening Credit No Matter What Fed Says (BBG)
- Yellen Is Now Top Fed Hopeful (WSJ)
- Syria - A chemical crime, a complex reaction (Reuters)
- More ECB collateral: Wrecked cruise ship Costa Concordia raised off rocks in Italy (Reuters)
- Aging Boomers Befuddle Marketers Eying $15 Trillion Prize (BBG)
- Abe Turns Pitchman, Says Japan Is Now A Buy (WSJ)
- Ex-JPMorgan Employees Indicted Over $6.2 Billion Loss (BBG)
- Barack Obama blinked first in battle for Lawrence Summers (FT)
- Berlusconi to support Italian government in video message: sources (Reuters)
- How China Lost Its Mojo: One Town's Story (WSJ)
- Opposition figure: major decisions on Syria expected within hours (Al Arabiya)
- Syria challenges U.S. to "produce the evidence" that Assad regime launched chemical attack (CBS)
- British PM says world must act on Syria, weighs response (Reuters)
- U.S. Treasury to Hit Debt Limit in Mid-October (WSJ)
- U.S. could look beyond U.N. Security Council in any Syria strike (Reuters)
- Nasdaq, NYSE at odds on outage cause as SEC seeks facts (Reuters)
- Ackman’s J.C. Penney Sale Ends Failed Saga to Agitate for Change (BBG)
- Zandi, LaVorgna, Blinder, Rattner all is one con puff piece (BBG)
- Best Buy Founder Schulze Plans Stock Sale to Diversify Assets (BBG) - "diversify assets" = dump overpriced junk
- Zero Worship: Credit-Card Firms Compete With No-Interest Transfers (WSJ)
- Len Blavatnik wins $50m in JPMorgan lawsuit (FT)
- Danone Finds Yogurt’s All Greek as Oikos Chases Chobani (BBG)
In Part 1 of this article we documented the insane remedies prescribed by the mad banker scientists presiding over this preposterous fiat experiment since they blew up the lab in 2008. In Part 2 we tried to articulate why the country has allowed itself to be brought to the brink of catastrophe. There is no turning back time. The choices we’ve made and avoided making over the last one hundred years are going to come home to roost over the next fifteen years. We are in the midst of a great Crisis that will not be resolved until the mid-2020s. The appearance of stability is illusory, as the civic fabric of the country continues to tear asunder. Record high stock markets do not trickle down. The masters of propaganda seem baffled that their standard operating procedures are not generating the expected response from the serfs. They have failed to take into account the generational mood changes that occur; propaganda loses its effectiveness in proportion to the pain and distress being experienced by the citizenry.
Following yet another rout in Asia overnight, which since shifted over to Europe, US equity futures have stabilized as a result of a modest buying/short-covering spree in the 10 Year which after threatening to blow out in the 2.90% range and above, instead fell back to 2.81%. Yet algos appear confused by the seeming USD weakness in the past few hours (EURUSD just briefly rose over 1.34) and instead of ploughing head first into stock futures have only modestly bid them up and are keeping the DJIA futs just above the sacred to the vacuum tube world 15,000 mark. A lower USDJPY (heavily correlated to the ES) did not help, after it was pushed south by more comments out of Japan that a sales tax hike is inevitable which then also means a lower budget deficit, less monetization, less Japanese QE and all the other waterfall effect the US Fed is slogging through. Keep an eye on the 10 Year and on the USD: which signal wins out will determine whether equities rise or fall, and with speculation about what tomorrow's minutes bring rife, it is anybody's bet whether we get the 10th red close out of 12 in the S&P500.
The past few weeks have seen the tech and business media abuzz about a not-so-little warehouse in Tennessee. That's because this distribution center, opening its doors with a burst of fanfare and even a few visits from nearby politicians, isn't a jumping-off point for Macy's or Target. Instead, the warehouse is the latest in a series of new locations being opened by retail technology giant Amazon.com. The jobs this new mega-warehouse is purported to create: 5,000. However, as we discuss below, for every job Amazon "creates," four other jobs go away at a company like TJX.
Being poor is like a game of poker where if you lose, the other players get to screw you. And if you win, the dealer screws you. A bunch of you reading this are among the 45 million “working poor” in America, and if you’re not, you know somebody who is. People are quick to tell you to pick yourself up by your bootstraps and just stop being poor. What they don’t understand is the series of intricate financial traps that makes that incredibly difficult...
As previewed previously, one half of the hurdle to enforce a universal online US sales tax has now been crossed, with the Senate voting moments ago to pass a Wal-Mart backed bill 69-27 allowing states to collect taxes on out of state Internet and catalog sales. The bill would end the era of tax-free Internet shopping. During the debate, senators offered examples of consumers who examine products in stores and then shop online to avoid paying sales tax. The pretext? Why fairness of course. “This bill is about fairness,” said Senator Mike Enzi, a Wyoming Republican and co-sponsor of the measure. “It’s about leveling the playing field between the brick-and-mortar and online companies.”
- Euro-Area Unemployment Increases to Record 12.1% Amid Recession (BBG)
- Fed faces calls for radical reform (FT) - Has Jamie Dimon approved of this message? No? Carry on then
- CEO Pay 1,795-to-1 Multiple of Wages Skirts U.S. Law (BBG)
- Ex-UBS Executive Convicted of Paid Sex With Underage Girl (BBG)
- Six months after Sandy, New York fuel supply chain still vulnerable (Reuters)
- Older, richer shoppers lead Japan’s surge in consumer spending (FT)
- Sharp euro zone inflation fall, joblessness point to ECB rate cut (G&M)
- Gold Rush From Dubai to Turkey Saps Supply as Premiums Jump (BBG)
- Japan Industrial Output, Retail Sales Disappoint (MW)
- Gunmen surround Libyan justice ministry (Reuters)
- Insider-Trading Probe Trains Lens on Boards (WSJ)
- Best Buy exits Europe (WSJ)
- Banker Roommates Follow Zuckerberg Not Blankfein With IvyConnect (BBG)
- Helicopter QE will never be reversed (Evans-Pritchard)
- Bank of Japan Launches Easing Campaign under new leadership (WSJ)
- Draghi Considers Plan B as Sentiment Dims After Cyprus Fumble (BBG)
- Spain threatened by resurgent credit crunch (FT)
- U.S. Dials Back on Korean Show of Force (WSJ)
- Gillard Urges Aussie Firms to Emulate German Deutschmark Success (BBG)
- Bank watchdog warns on retail branches (FT)
- Xi's Russia visit confirms continuity of ties (China Daily)
- Portuguese Government Survives No-Confidence Vote (WSJ)
- Mortgage rates set for fall, Bank of England survey shows (Telegraph)
- Russia’s bank chief warns on economy (FT)
- Fed member hints at summer slowing of QE3 (FT)
It is clear now that we must have been wrong about the economy. No more proof is needed than the fact the Dow has gone up 1,500 points. Everyone knows the stock market reflects the true health of the nation – multi-millionaire Jim Cramer and his millionaire CNBC talking head cohorts tell us so. Ignore the fact that the bottom 80% only own 5% of the financial assets in this country and are not benefitted by the stock market in any way. It is time to open your eyes and arise from your stupor. Observe what is happening around you. Look closely. Does the storyline match what you see in your ever day reality? It is them versus us. Whether you call them the invisible government, ruling class, financial overlords, oligarchs, the powers that be, ruling elite, or owners; there are powerful wealthy men who call the shots in this global criminal enterprise. No amount of propaganda can cover up the physical, economic, social, and psychological descent afflicting our world. There’s a bad moon rising and trouble is on the way.
Is "discretionary income" rapidly becoming a thing of the past for most American families? Right now, there are a lot of signs that we are on the verge of a nightmarish consumer spending drought. Incomes are down, taxes are up, many large retail chains are deeply struggling because of the lack of customers, and at this point nearly a quarter of all Americans have more credit card debt than money in the bank. Considering the fact that consumer spending is such a large percentage of the U.S. economy, that is very bad news. How will we ever have a sustained economic recovery if consumers don't have much money to spend? Well, the truth is that we aren't ever going to have a sustained economic recovery. In fact, this debt-fueled bubble of false hope that we are experiencing right now is as good as things are going to get. Things are going to go downhill from here, and if you think that consumer spending is bad now, just wait until you see what happens over the next several years. The following are 16 signs that the middle class is rapidly running out of money...