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Consumer Health Diagnosis "Grim" As Four Out Of Five Spending Indicators Disappoint
Following up on Friday's abysmal consumer income data, we now take look at the spending side of the equation, without much optimism. Not surprisingly, as Bloomberg's Richard Yamarone summarizes, the consumer health picture in January was "grim" and "after adjusting for inflation and taxes, is simply insufficient to sustain the expansion." He adds that "over the last couple of weeks, no fewer than a dozen consumer-related companies made mention of the deterioration in incomes as a risk to business and performances." Yamarone concludes: "Spending on discretionary items has softened in recent months. Four of our ‘Fab Five’ spending barometers fell or were unchanged in January from December. Comments from the Bloomberg Orange Book suggest further deterioration ahead." That this is happening with rates at zero, and with an effective countrywide mortgage payment moratorium allowing millions to live mortgage payment free, means that if and when things normalize, consumption - the driver of 70% of the US economy - will fall off the proverbial cliff.
From Bloomberg Brief:
In recent weeks C-suite executives in the Bloomberg Orange Book have increasingly cited real disposable personal incomes as a concern. In fact, over the last couple of weeks, no fewer than a dozen consumerrelated companies made mention of the deterioration in incomes as a risk to business and performances.
Spending on discretionary items has softened in recent months. Four of our ‘Fab Five’ spending barometers fell or were unchanged in January from December. Comments from the Bloomberg Orange Book suggest further deterioration ahead.
Casino spending fell 1.6 percent in January. Caesar’s Entertainment CEO Gary Loveman said that his company’s performance was executed “against the backdrop of ongoing uncertainty in the macroeconomic picture in this country and consumer weakness in the U.S. economy that negatively affected discretionary consumer spending and ultimately our gaming results.”
While spending on cosmetics inched up 0.6 percent in January, the forwardlooking commentary wasn’t encouraging. Elizabeth Arden CEO Scott Beattie said the consumer continues to face challenges. “These are customers that are living paycheck to paycheck, many of them reliant on government subsidy in food stamps and unemployment insurance and other kinds of government subsidies.”
Jewelry and watch spending was unchanged in January, and dining out registered a 0.1 percent decline.
Weakness in dress sales were mentioned by bebe stores inc., which supported the 1.1 percent monthly decline in spending at women’s and girls’ clothing.
As long as this mindset continues – which is largely a function of dwindling available incomes – spending will remain depressed and the economic recovery weak at best.
But as long as the depression remains strong...
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How can this be? Central banks are printing as fast as they can...
The only answer - MOAR!!!!
DOW 14K.....what's the problem?
It's not at 20,000?
That's the problem.
USA TODAY
Top Story:
The department of treasury has announced that it will auction-off the following aircraft carriers:
Nimitz (CVN-68), Dwight D. Eisenhower (CVN-69), Carl Vinson (CVN-70),Theodore Roosevelt (CVN-71), Abraham Lincoln (CVN-72), George Washington (CVN-73), John C. Stennis (CVN-74), Harry S. Truman (CVN-75), Ronald Reagan (CVN-76), George H.W. Bush (CVN-77).
We are pleased to offer the de-militarized ships to serve for global humanitarian services. The proceeds will be used to upgrade the US infrastructure.
What a wonderfull idea! George Bush can fill our potholes.
New ‘Powerful Force’ to Underpin Stock Rally
Published: Sunday, 3 Mar 2013
A wave of new money coming into equity markets is a "powerful force" to reckon with and means that risks such as the U.S. budget cuts and uncertainty in Italy are unlikely to derail a stellar rally in the markets, one expert told CNBC.
While there has been much talk of a "Great Rotation," a shift by long-term funds into equities from bonds amid improving sentiment, the real driving force behind recent gains in equities has been an inflow of new money that was previously held in cash, said Laura Fitzsimmons, vice president for futures and options at JPMorgan Investment Bank.
http://www.cnbc.com/id/100516038
DR. BERNANKE TO THE PRINTING CONTROL ROOM STAT..
210 NEW DOLLAR BILLIONAIRES IN 2012 ON THE FORBES LIST!!!
at least they feel happy...
And the AAPL still has a long way to fall. :-)
AW! Poor ol' consumer slave!
Printing moar fraud does not create truth.
Anyone saying otherwise is selling fraud.
Stop going to WalMart and go to the casino. Check.
They can't afford to drive to the casinos. The masses are buying lotto scratch offs instead.
http://www.actionnewsjax.com/news/state/story/Florida-Lottery-breaks-Scr...
Accordimg to the latest WalMart memo....they have stopped.
If they're not going to the casino instead.....I'm not really sure where they're going. Haven't checked the latest stats from Disneyland yet....maybe they went there.
http://www.ft.com/intl/cms/s/0/b52386ec-77a8-11e2-b95a-00144feabdc0.html#axzz2MZtmm4eV
As long as the depression remains strong... The Fed will keep buying until it has every investible product available in the US except for equities. There will be no place else to put your money except under your mattress.
I am waiting for the Bernanke Helicopters to fly over my house. Do they only hove over Wall Street?
I would use them drones to drop the money. That's more efficient.
The Irish mob boss who was recently "discovered" living in LA and who used to work for the FBI (not as an informant according to the New York Times) "kept his millions in the wall of his apartment." I think we don' really know with trillions flooding the banks "as deposits" bow much is actually being stolen "so that when someone comes to get their money out" that dollar amount is always there. Something tells menwe will never know...
I think I know the one you are talking about. The FBI granted him immunity from all crimes committed past, present, and future while at the same time not requiring him to be an informant. It would be unbelievable except for 2 things; it happened in the Peoples Republic of Massachusetts and his brother/next door neighbor is a corrupt midget.
rien ne va plus
Yamarone had the audacity to measure this in "real" dollars (i.e. not inflated Benny Bux)? Treason!
Yeah, just as long as Bernanke pumps in $80 billion a month we'll be just fine.
Remember the Zerohedge piece from a while back that analyzed this -- if you consider the average household makes $50,000/ year, Bernanke's pumping is the equivalent labor and economic output of 20,000 families just created out of nowhere.
Bernanke's printing of $85 billion a month is equivalent to 20.4 million families making $50,000 a year not 20,000.
Oops, darn decimal points...... thanks for the correction.
Casino Gambling down 1.6% in January
Surely you are not counting those in New York.
it's not gambling when YOU'RE THE BANK!
Do the casino figures include the Dow, S&P and Nasdaq?
I figured out why there seems to be more traffic on the LA freeways. I passed two cars and one truck that were stopped in the middle lanes on various freeways this weekend. They appeared to have run out of gas.
You can't run out of gas on the LA freeway, some will just push you from behind until you exit for gas. Have you driven in S. cali lately?
The new normalize, move in wit your folks after your removeal from your unpaid dwelling.
If deficits don't matter, either do consumers... Lets just give all the money to Wall Street and Washington! Heck if we can just get a couple trillionaires spending a trillion each...then the "average" spending will be up!
I would try spending a million dollars a day first, it's to easy to steal a trillion these days.
Health Care costs are rising here in MA (but inflation):
http://www.boston.com/business/healthcare/2013/03/04/medical-costs-are-t...
Devalue's got you covered. He has a plan to tax everything that is necessary for existence. And for you people driving electric cars, he is working on a miles driven tax to as the gas tax just isn't bringing in what it used to.
Casino gambling is down and yet my state has built 3 (with 4 more coming) in the past couple years. All have tanked in after a few months of being open. To try to make the most profitable one look good the Assembly even passed a bill allowing it to be open 24 hours so even the drunks and problem gamblers can keep pissing their family's money away without having a few hours to chill out; money which could instead be spent and create real jobs. No end in sight for the ones remaining to be built which will only siphon business from the others. The last one will be constructed in Prince George's County (bordering D.C. on the East) which, if you're not a single mom on welfare you likely work for the government.
The thing is, the State WANTS you to not only gamble your money away, but do so AS the casinos take a side cut (who are in major debt to Wall St). And, they want you to do it with as much volume, and playing as stupid of games (slots/craps) as possible.
They don't like poker because of the fact that it actually goads people to actually try and THINK. They don't like sportsbetting because the leagues want to control that action.
The over-saturization of casinos is also due to the fact that governors, R or D, are under pressure to create jobs...ANY job. So build, build, build.....even if the growth or wages don't reflectsupporting these businesses. Even if after the construction (unionized temp) jobs are done, the jobs created in thee establishments are usually low/minimum wage work.
It's basically China's infastructure model, except under a privatizated model......which means their is more self-interest involved by both eager politicans and oligarchs.
What can possibly go wrong?
Maryland casinos are not profitable because the greedy state takes too high a cut. The National Harbor one should be profitable though, as it is right near DC and has its own exits from the Beltway and I-295. But it doesn't have a direct Metro connection, and that should keep the welfare moms away, and will limit its profit potential.
"Maryland, my Maryland..."
Sad to hear they went down that path, but I'm not surprised.
We are living in Biff's world of "Back to the Future - Part II".
The build more casinos mentality is similar to what is happening in N. Cal - as the price of dope drops, build another greenhouse next to the first one to increase supply...
If Maryland can't figure out fundamental economics, why the hell should a stoned dope grower do any better?
3 ONETHOUSAND, 4 ONETHOUSAND, 5 ONETHOUSAND....
WE'RE LOSING HIM DOCTOR!!! WE LOSING HIM....
okay... let's call... let's call it time for breakfast...
Still blaming Bush?
Sandy... sandy did it...
Still caught up in the two party illusion?
Yes.
Still think anyone can get the world out of the hole he dug?
I didn't think so...
Retail is dead.... D_E_A_D... except for gun shops of course.
I prefer to think of gun shops as criminal safe zones.
They should install one on every college campus as a place to seek refuge.
People begin to realize they do not need more then 85 sweaters....68 dresses....12 iPods....and so on.....
Amazingly, I think the wife is finally figuring it out. We took six garbage bags of T-shirts, shorts, etc out of our three sons rooms last week. They still have enough clothes to go a month without doing laundry. I think (hope) I saw a lightbulb going on over her head.
No surprise here. They are all saving for the new Samsung Galaxy SIV.
Not yet, Bernanke, Evans, Dudley and Yellen have to trigger a currency crisis.
A Zimbabwe moment.
We have much more dollar trashing going forward. The banksters have transfer much more wealth.
Olive garden (smaller plates and cheaper meals) and others trying to gain more from a squeezed consumer.
In the meantime local governments are increasing taxes and fees to keep the public pension and pay Ponzi scheme going.
My fresh swordfish steak is the same size as before, cause he gets cooked at home.
And now it costs at the store what you used to pay at the restaurant!
It must be time for the Owebama/Crazy Uncle Joe summer of recovery tour IV, or whatever number they are on....get the wheels back on the choom bus!
Speaking of healthcare grimness and bait and switch. More hidden taxes rear their ugly head concerning obamacare.
http://communities.washingtontimes.com/neighborhood/stress-and-health-dr...
WASHINGTON, DC, March 3, 2013 - You are going to pay more, much more for healthcare thanks to the new ObamaCare soon to roll out across America.
The Internal Revenue Service (IRS) released its proposal Friday to earn billions of dollars through annual fees on health insurers as part of the Affordable Care Act.
Industry groups are quite upset, arguing that the fees will be passed along to consumers.
America’s Health Insurance Plans (AHIP), the leading trade group for the insurance industry, blasted the fees as a tax that would exceed $100 billion in the next decade and hit average families still struggling to rebound from the economic recession. And if the insurers don’t pay on time they are going to face penalties of $10,000, plus $1,000 for every day they miss deadline.
“This is a new $100 billion tax on health insurance,” AHIP spokesman Robert Zirkelbach said in an interview Friday. “Taxing health insurance is only going to make it more expensive.
The fees, to be collected from most insurers, would register $8 billion next year and rise every year afterward, breaking $14 billion in 2018, according to the IRS. The amount of the fees would depend on an insurer’s net premiums.
The group estimates that an average family’s health insurance would rise by more than $300 next year, with that total surpassing $500 in subsequent years.
With wages stagnant and disposable income and personal savings down $300 - $500 is going to be a big hit on middle class families.
Because unlike consumers, "industry groups" have lobbyists.
So do student loan sharks:
Studen Loans getting so big, it's a spending driver
http://www.nakedcapitalism.com/2013/03/student-loan-bubble-so-big-its-trumping-credit-cards-as-a-spending-driver.html#vPfwMX47u4RdKkR2.99
Is there any such thing as a document that proves one is an illegal immigrant? If so, go get yourself some and you can go to the ER for free. Just don't let anyone know you're really a hard-working, tax-paying responsible citizen, because then you'll be raped financially.
"Yes we can!"
.
Casino Gambling down run for the hills.
Smoke and mirrors can only hide reality for a certain amount of time until reality grows too big and can't be covered up any longer
Reality only has to be hidden until the DHS gets those 2700+ armored vehicles (MRAPs) from which to fire their billions of hollow-points at us.
Does anyone know if it's legal, under the second amendment, to have an anti-tank weapon? After all, a LAW (light anti-tank weapon for those not familiar with the term) can be carried by one person.
We're amearicans,we should be able to come up with a way to neutalize them.Paint on the windshield,that would be horrible if they couldn't see and a 50 gal flaming barrel of gas came their way.
Walmart has a new ad out about where you should shop with your tax return. What a sad state of affairs when the only disposable income is tax return money. Yes! Go to walmart and buy cheap chinese shit with what the statists in Washington have aloud you to have.
What a fuckin mess.
This is the first year when my income tax refund is not already accounted for...
Foolishly, I paid down mortgages & put the money towards new vehicles every time my wife crashed her old one.
Mortgages paid off, no crash this year, looks like the whole refund goes to gold & ammo. Maybe I'll get me a drone...
bullish
What!? You mean, no one has any money!? How can that be, when wages have only been stagnant for 40 years? Cheezus, people, tighten the belt! Live on pink slime, if you have to! Oh, wait...
Is a bag of beans counted as discretionary or disposable? Maybe if the DOD needed less aluminium oxide to spray on us, less to build rockets and drones to kill everyone we'd have more for plastic crap from the slave girls in china and watered down beer from Goldweizerman or petrol from der fuel monopoly that is definitely not gouging according to the just a political contribution bag men.
"spending on cosmetics inched up .06 percent"
This pig takes a lot more lipstick than it used to. Cosmetics is a perfect metaphor for the global economy; bullish cover-up.
Guys: (1) private sector GDP less inventories actually grew healthily in 4Q12 (+3%), and has been for the last year or two. (2) consumption in 4Q12 grew at an annualised +2.2%, up from +1.6% in 3Q. (3) financial stocks across developed markets are going gangbusters. They are usually harbingers of economic recovery and a rising overall market, as Crispin Odey has noted in the past. One can get suicidal with all the other lousy data, but the bears are having their arses soundly kicked. The market is signalling something different to the permabear end of the world view. Yes, long term, what Bernanke is doing is financial terrorism. But might he just be proven right in the short term? Might the economy, despite everything be turning a corner?
You must have coconut sized balls to bring the bullish case up here!!
(I agree by the way....)
So what happens if the EU collapses,Japan or China ? People aren't making more money,my wife hasn't had a raise in 5 years.Then look at Detroit,you think they are the only city in trouble and then on top of all that lets throw in the $4.25 gal gas and rising food prices,it's all yours.The only things I've been spending money on is guns and ammo and the pace of that is about to slow way down.
I note for the record that the ridiculous notions that Glass Steagall was a bad idea and lots of casinos are a good idea became popular at about the same time. Coincidence?
KEEP ON SHOPPING AND WATCHING DANCING WITH STARS WHILE GUZZLING YOUR SUPER SIZED COKES AND JAMMING 241 DOMINOS INTO YOUR BIG FUCKING FAT GUTS YOU STUPID DIABETES RIDDLED AMERICAN ASSHOLES!!!! :)
GREAT NATION ON EARTH???? HAHAHAHAHAHAHAHAHA - BY WHAT MEASURE - MORONS, DONKEYS, CORRUPTION AND OF COURSE GUNS AND AMMO?