NRF

• Office Depot Agrees to Buy Officemax for $13.50/Shr in Stock
• Bulgarian Government Resigns Amid Protests (WSJ)
• Rome will burn, regardless of Italian election result (Reuters)
• Abe Says No Need for Foreign Bond Buys Under New BOJ Chief (BBG)
• Rhetoric Turns Harsh as Budget Cuts Loom (WSJ)
• Muddy Waters Secret China Weapon Is on SEC Website (BBG)
• Business Loans Flood the Market (WSJ)
• Staples May Be Winner in Office Depot-OfficeMax Merger (BBG)
• Fortescue Won't Pay Dividend, Profit Falls (WSJ)
• Key Euribor rate on hold after rate cut talk tempered (Reuters)
• FBI Probes Trading in Heinz Options  (WSJ)
• Spain Said to Impose Yield Ceiling on Bond Sales by Regions (BBG)
• BOK’s Kim Signals No Rate Cut Needed Now as Outlook Improves (BBG)

Not surprisingly when wages and salaries are growing at a slower rate there is a corresponding weakness in the level of retail sales.  The peak in wages and salaries occurred in early 2011 with the subsequent growth rate trending weaker.  This corresponds with the economy which has continued to muddle along at a very anemic pace.  While it may be likely that the damage from Hurricane Sandy may have soured some sales, particularly in the North East, it is unlikely to have had much of an effect on the retail sales nation wide.   For majority of America the "fiscal cliff" debate largely goes unnoticed as it remains a battle between the White House and the "rich" - for the rest the country it is more of a distraction from the things that matter like "Honey Boo Boo" and "Housewives Of Whereever".   What does matter though, as stated above, are incomes.  The decline in incomes, which can be seen in the roughly 1.2 million person increase in food stamp participation from June to September, is why retail "holiday" spending is weaker.  With credit limits reduced, incomes stagnant and real costs of living on the rise - it is not surprising that retail sales are far weaker than the NRF's holiday season predictions.

• Here come the low margin products: Apple Tests Designs for TV (WSJ)
• Obama and Republicans Trade Offers to Avert Fiscal Crisis (BBG)
• Carney broaches dumping inflation target (FT)
• Bernanke Critics Can’t Fight Bonds Showing No Inflation (BBG)
• Corporate Taxes on Table in Cliff Talks (WSJ)
• US business chiefs back tax rise (FT)
• Greece Confident Bond Buyback Needed for Aid Succeeded (BBG)
• New Faith in Europe's Banks (WSJ)
• European Bank Sees Little Room for Rate Cuts (WSJ)
• North Korea Claims Success in Rocket Launch (WSJ)

• As this has been priced in since September 13, it should come as no surprise to anyone: Fed Stimulus Likely in 2013 (Hilsenrath)
• Bowles Says Fiscal Cliff Deal Unlikely by End of Year (Bloomberg)
• Argentina debt repayment order frozen (FT)
• Obama Is Flexible on Highest Tax Rates (WSJ)... not really
• Geithner deployed for fiscal cliff talks (FT)
• Audit firms Deloitte and KPMG sued in HP's Autonomy acquisition (Reuters)
• Euro-Zone Budget Proposal Is Unveiled (WSJ)
• EU Nations Clash on Thresholds for Direct ECB Oversight (Bloomberg)
• LDP leader Abe: BOJ must ease until inflation hits 3 percent (Reuters)
• SNB’s Jordan Says High Swiss Franc Burdens Many Companies (Bloomberg)
• EU to launch free trade negotiations with Japan: EU officials (Reuters)

While the common wisdom, espoused by any and all commission-taking wealth manager looking to up his AUM, is that Black Friday sales (and the anecdotal evidence from self-referential store-owners and CEOs) can tell us about the trend in the economy or they offer some divine extrapolated insight into the year's final sales number. The truth; you can't handle the truth.  As BofAML's Michelle Meyer notes, there is no correlation between total holiday sales and Black Friday sales over the past seven years. In fact, we believe that not only are the early estimates of Black Friday sales insignificant, they can send misleading signals. More fundamentally, Black Friday sales can either signal a healthy consumer or a desperate one, depending on the state of the economy. The bottom line is that we advise fading the Black Friday sales reports, but paying attention to the aggregate holiday sales reports.

• Global easing deluge resumes: Bank of Korea Slashes Policy Rate (WSJ)
• And Brazil: Brazil cuts Selic rate to new record low of 7.25 pct (Reuters)
• With Tapes, Authorities Build Criminal Cases Over JPMorgan Loss (NYT) Just don't hold your breath
• IMF snub reveals China’s political priorities (FT)
• Add a dash of trade wars: Revised Duties Imposed by U.S. on Chinese Solar Equipment (Bloomberg)
• IMF calls for action as euro zone crisis festers (Reuters)
• Dubai Losing Billions as Insecure Expats Send Money Abroad (BBG)
• Softbank in Advanced Talks to Acquire Sprint Nextel (WSJ)
• Lagarde calls for brake on austerity (FT)
• EU lambasts Turkey over freedoms (FT)
• Race Tightens in Two States (WSJ)

As America prepares to spend its meager savings (which today were reported to have increased modestly from 4 year lows of 3.3% to 3.5%) and dip even more in debt on yet another epic shopping exodus which begins in just over 24 hours and continues through the end of the year, whereby people are somehow once again fooled into believing they "save money" by "spending money", those with a more pragmatic eye may wonder if this will be the weakest holiday shopping season in a decade, if the economy indeed mimics the stock market (the opposite, not so much), and whether it is now time to finally short consumer discretionary stocks with impunity. Goldman's Zach Pandl answers this question and more with his "Q&A on Holiday Shopping." To wit: "The US consumer looks mixed heading into the holiday season. On the one hand, growth in consumer activity slowed significantly this year. On the other hand, the most recent spending numbers have shown an incremental improvement.  In addition, job growth has been holding up, which should underpin spending. Retail industry groups expect year-over-year growth in holiday sales of 2-3%, down from a 4-5% increase last year. The GS/ICSC 2011 Holiday Spending Intentions Survey also seems consistent with slightly slower growth than last year." Naturally, this being Goldman, if there is a way to take the other side of the bet (or do what GS is doing and not its clients) that is probably not such a bad idea.

All you need to read.

The National Retail Federation has reported that the average Thanksgiving spend has declined from $372 in 2008 to $343 in 2009, as more shoppers sought out rock-bottom 5 am bargains: the estimated number of bargain hunters increased from 172 million to 195 million.

• Apartment vacancies in the U.S. rose to 7.8% - a 23-year high.
• Asian stocks rise on US Services Industries data, higher commodities prices.
• Australia raised its cash rate target by 25 bps - first Group 20 to unwind stimulus.
• Dollar weakens as newspaper says Gulf States may drop greenback for oil trades.
• European, asian stocks advance; BHP Billiton, Dexia, Adidas shares climb
• Gartner sees narrower '09 chip revenue fall but cuts '10 forecast.
• Gold inches up towards $1020 on weak dollar