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Wal-Mart Cuts Guidance Again, Blames Obamacare
Remember this chart from November, when everyone was predicting a surge in global GDP and "escape velocity" growth for the US economy on the latest burst of irrational hopium that central-planning works (it doesn't)?
Well, yeah....
Also, it just got worse. Moments ago WalMart reported in-line EPS driven by flat comp store sales. Curiously, even Wal-Mart is marginally increasing prices to offset a decline in store traffic:
During the 13-week period, Walmart U.S. comp traffic decreased 1.1 percent, while average ticket increased 1.1 percent.
The CEO's take:
“As it relates to our challenges in the quarter, we wanted to see stronger comps in Walmart U.S. and Sam’s Club, but both reported flat comp sales. Stronger sales in the U.S. businesses would’ve also helped our profit performance.”
And when the best priced retailer in the world is forced to start hiking prices to offset declining volumes, what does that mean for cost-push (not its benign wage-driven, demand-pull cousin) inflation?
But the real message, and what suggests global GDP will continue to deteriorate, was that Wal-Mart just did what it has done so many times in the past several years. It cut guidance.
Walmart updated full year EPS guidance to a range of $4.90 to $5.15, from a previous range of $5.10 to $5.45. This range includes third quarter EPS guidance of $1.10 to $1.20. The new full year guidance reflects incremental investments in e-commerce and higher U.S. health-care costs than previously anticipated. This guidance also assumes the effective tax rate will be around 34 percent for the third quarter. The annual effective tax rate is projected to be between 32 and 34 percent. The actual rate will depend on a number of factors, including our performance, discrete items and pending U.S. Congressional actions regarding the extension of certain tax legislation.
Obamacare's fault.
Oh, and those predicting an imminent CapEx renaissance, please don't look at the 16% Y/Y plunge in WMT CapEx in H1. The good news, for shareholders, free cash flow rose to $6.8 billion from $5.2 billion, thanks to a continue decline in investing in the future.
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First was weather....now Obamacare...what will be next...Russia?
Locusts
Ebola
ISIS..
Oh my!
Polar vortex
Obamacare: Ongoing Disaster With No End In Sight
Next? Inflation - wholesale price increases. Maybe more EBT system glitches.
Vote Hillary, for the common good!
FORWARD SOVIET!
You mean Walmart customers?
Obamacare: The Hidden Agenda
Wal-Mart Cuts Guidance Again
29.5 hr/wk jobs bitchez!
Gonna have to move the heavens to change that fact.
Obamacare: Was the ACA a planned legislative disaster?
Don't be silly. Why would they "plan" legislative disaster. Think Occam's Razor. Obamacare was a successful attempt by health insurance companies to pass a law to force people to buy their products thereby increasing and guarenteeing health insurance company profits in the future. Their lobbyists wrote the bill, and that's what the purpose was.
Healthcare, just like education, is always destined to have ever-increasing costs, ObamaCare-like programs or not. ObamaCare was always positioned to be whatever group wanted it to be. For "lefties", it was about humanizing a cruel and corrupt system by making the system "work" for everyone. For the "righties", it was about prventing the government to have any truly substantive affect on corporate profiteering (ObamaCare actually entrenches more profiteering).
Pretty much F Wal Mart! The place brings in Chinese crap that is junk. Their customers anymore are Obama voters with EBT cards and illegal aliens. It should be called Third World Mart. Shithole store.
The billionaire elites F'ed Amerika and now they cannot understan how they killed the golden goose. F them.
'And when the best priced retailer in the world...'
.
The masses are leaving 'the best priced retailer' and heading to the Dollar Store and Thrift store.
Was dropping off some stuff at a Goodwill store last Saturday and the line for people making back to school purchases was quite long at the register.
Antithesis to that anecdote, my sister is the store manager at Sachs Fifth Avenue in Bal Harbour and her store is experiencing record sales volume.
The polarization of the US economy has reached historic proportions. The unintended consequences are manifesting themselves in seething social unrest as experienced in Ferguson.
http://www.zerohedge.com/news/2014-06-05/rich-get-richest-household-net-...
Bal Harbour = bagel land and Russians.
Unrest in Fegurstan is nothing unusual.
It is the people who make the slum.
If it was a mob of mixed age White people protesting, then there would be a serious message there.
But Blacks burning, looting and rioting?
S.O.P. for such civilized and high class pillars of society.
Best priced? LOL! Wal Mart went to Germany and Aldi kicked their ass so hard that Wal Mart gave up on Germany and most of Europe. Between Aldi and Lidl - Wal Mart never had a chance in Germany and Europe.
Aldi is also Trader Joes.
I think they actually have a wheel at the WMT offices a la The Price is Right where they spin it and whatever "scenario" it lands on, that what they use to blame shitty performance on.
Until they spin "The Public" and then they release the dogs of war on us to squeeze the last little but of borrowing power out of us to keep the system alive. When that no longer works than we are no longer useful and the culling will begin. So as quoted by the head of the Reserve l "shop or die mother fuckers".
Poorly kept greens
Dubaibanker - Higher healthcare costs and skyrocketing premiums definately would impact retail sales. That and much higher food and energy costs this year.
,"if u like ur health insurance, u can keep ur health insurance."
nothing MOAR EBT can't fix. Print, give, spend.
you forget the obvious source of the problem: George W. Bush
;-)
Equities are up, up, up and away. This shit is like Superman. The only thing that can bring it down is a GAAP earnings report, but we killed GAAP in favor of fake performance numbers.
Equities are up, up, up and away.
Print that shit Rick Masters....
https://www.youtube.com/watch?v=6Q6VsR_4PuQ
Wal-Mart can't continue expanding. They're everywhere. CapEx can only be spent on modernization of existing stores.
Au contraire,
They're building a Supermarket Pharmacy in my town of 3000.
They're moving into small rural places that are underserved or with one supermarket with no competition.
20 years ago they wanted to come in with a Supercenter because of the interstate hwy but the local merchants sent em packing.
Their newer stores are either Supermarkets or supermarkets and much smaller merchandise stores. Why? EBT cards. Wal Mart is the food lines of Amerika.
The only good thing is Aldi is expanding along with Aldi's Trader Joes. Aldi and Lidl murdered Wal Mart in Germany and Europe. Aldi will slowly put a real hurtin on WMT in the USSA. Aldi has less GMO food than WMT.
I remember reading that CA kept them out. That's a Hella big market they could expand into...
1.1% doesn't even cover inflation. Wally world blames Obamacare, Obamacare blames the polar vortex, and Hillary says What difference does it make. However, less Wal marts is definately a good thing.
However, less Wal marts is definately a good thing.
Yeah, you can go from having a few low wage jobs in your town to none when people purchase items online instead...
"zerohedge @zerohedge 31s
WMT boosting prices to offset declining traffic means cost-push inflation is around the corner"
Let me see, some people can't afford to go to Walmart.
Walmart raises prices... even more people can't afford to go to Walmart.
Yes I can see the logic behind raising prices /sarc
Can we all say " STAGFLATION" ?
No, it's cost push inflation. The reason so many folks want to call it something different is because true cost push inflation (what we have) only comes about every so often and is less frequent than demand pull (at the very least, certainly not allowed to be discussed on the MSM the same as demand pull). Everyone wants to discover a new species, but this one has been observed for millennia.
Once retailers push producers to the brink, then things get interesting. Right now, most of the battle is between consumers and retailers. If walmart, who has the most leverage of any retailer, cannot push back, then we're getting close.
Inflation hurts everyone (well, Mainstreet...not WallStreet).
Local water and ice cream shop...Mom & Pop operation.
Sell premium ice cream as a niche neart large supermarkets selling regular ice cream.
Premium ice cream supplier raised prices to this small retailer a big jump.
Raised a double scoop in a cup from about $3.50 to $4.50.
I used to take the kids there a couple times a week as a special treat.
But now at $9.00 (and tax)? No more.
Now it is the dollar menu cone at BurgerKing (was $1.00 but now raised to $1.29 plus tax) or nothing.
4th casino in 2014 in Atlantic City to close by Sep 10.
3,000 more jobs gone. How can Wal Mart succeed when it's customers have no jobs? Of course, sales have to keep going down.
In latest setback to Atlantic City, lavish Revel casino to close
This huge casino closing is no small comment about the "real economy" and what is still happening across America. Below is an article about small business failures and how they should receive a lot more attention then they do, we will see a lot of these in the near future as people have started down this path when unable to find a job.
Small business is hard, going into business is risky, and many people are not up to the task. As a property owner that leases space to many start-ups I have a keen interest and knowledge of the microeconomics that occur. Just as important is the effect, long and short term on the economy. With most business start-ups having a very short lifespan of just months or around a year, the short term burst of spending is quickly followed by the longer term negatives. More on the toll taken on all of us when a small business fails in the article below.
http://brucewilds.blogspot.com/2013/03/small-business-failures.html
still, its the wrong casinos closing. Should be the ones on wall st
Actually with each state passing laws allowing casino gambling its getting harder and harder for the major hubs like Las Vegas and Atlantic City to pull in customers.
Pennsylvania passed a law allowing gambling at its race tracks and other venues, so there's no need to drive to Atlantic City anymore. Even though Jersey built a turnpike that runs from Philly down to Atlantic City explicitly for that purpose. And Atlantic City still has to compete with the Indian Casinos in Connecticut.
All in all, people are still gambling, they're just not taking junkets to Las Vegas or Atlantic City, they're spending their money closer to home.
Makes sense anyway, all that money spent on travel and hotel stays can be gambled away instead at the local casino. And, the money you would have gambled anyway can now be spent on booze and drugs.
Mutiple small businesses have failed locally.
Part of the reason is high rents for commercial space.
Here in a small, low traffic town, an est. 15 x50 foot store space in local micromall is about $2,000 per month+utilities+licenses+taxes+wages. Which is hard for small startup businesses to handle.
A friend has a restaurant in a larger city, moderate traffic area, pays a bit over $5,000 per month rent.
Hard to cough that up monthly.
Local military base shut down. Hundreds of houses and many good buildings with commercial potential just sitting idle. Govt could have rented/leased/sold the houses to area working class families and same to small businesses for low cost, helping local people and local economy.
What did the Govt do?
Nothing.
Let all sit idle, let be vandalized.
Gave prime lands and buildings in sweetheart deals to connected real estate developers and the like who tore down the affordable housing and built high-priced housing. Local Govt happy as property tax on new expensive buildings are much higher than old old houses/buildings.
DK
How can Wal Mart succeed when it's customers have no jobs? Of course, sales have to keep going down.
Walmart accepts SNAP... In other words, walmart succeeds the same way everyone else is presently succeeding, by being closeser to the spigot.
Atlantic City and Las Vegas now obsolete.
We have the stock market now.
I'll say Vegas is obsolete. You can lose at a casino. BTFATH, and you'll never be sorry!
NJ voted for this TWICE. Nice job f**ktards. Stay in NJ and stay out of the south and the non-lib parts of Obama's Amerika.
futures still green? check... good thing "investors are focusing on earnings now that geopolitical tensions are easing" I read that on Yahoo Finance...
This just in: investors are shitty are reading comprehension
Much of the economic landscape is beginning to look like something out of "Alice And The Looking Glass" A bizarre and unrecognizable land, a land that is distorted and papered over by ream after ream of paper. This paper has been rolling off the printing presses of central banks all across the world in an attempt to mask reality.
Peter Schiff says, printing money is to the economy what taking drugs is to a drug addict. In the short term it makes the economy feel good, but in the long run it is much worse off. What was once the "long run" or "distant future" may be getting much closer. More on this in the article below.
http://brucewilds.blogspot.com/2013/01/what-happens-after-momentum-ends_...
I'm so tired of this balcony I could spit.
screw'em
The void is increasing.
I hate when people spit from the balcony...except when they miss me.
I remember when Wal Mart used to proudly display the names of the US companies it bought from in 12 inch letters in the front of the store. Eliminate the middle man has finally led to humongus stores filled with worthless chinese crap. Wonder where they went wrong? Duh.
I went to a Walmart recently in a racially 'diverse' area--trust me out of necessity, about 10pm. It was nothing short of complete DISASTER.
There were about 10 lanes open and each one had about 6 in line. There was a white guy in front yelling and screaming at the mgr about not opening more lines, a few cops swarming by, the young punks next to me had 2 carts full of nothing but chips,hot dogs, and top ramen, and a couple security vehicles flashing lights in the parking lot.
It was literally a zoo. Never again. When we went thru the clothing area the wife said why are there tires hanging from the ceiling? I said so the mexicans don't steal them. Of course that immediately drew a couple nasty looks but I don't fucking care.
The walmart by me isn't that bad actually, except for all the fatties and lazy fucks that leave their shopping carts all over the parking lot
I would be 65% of the Wal Marts in Obama's Amerika are like that. Third World EBT stores.
re. shop lifting/theft:
There are two Orchard Supply Hardware stores (large hardware store) in our area.
One in a mostly White area.
One in an almost completely Mexican area.
Though I happen to like Mexicans in general, I have learned to shop at the OSHardware in the White area, and to avoid the OSH in the Mexican area.
Why?
Because when I buy a box of something (i.e. door lock kit, etc) in the Mexican area OSH, too many times there will be missing stuff. Seems when some "folks" need a part, instead of buying the whole unit/box, they just take out and pocket the parts they need and put the now incomplete kit back on the shelf.
Never has happened at the White area OSH.
Nentioned it to the Mexican area OSH manager. he said, yes they have a problem with theft.
DK
So this news should be good for what? At least a 200 point gain.. right?
Party on!
Yes because it means everyone is spending money on higher quality, more expensive merchandise.
Just think in five more years Walmart will be a high end store....wow
Breakfast at Walmart will be an Oscar winning movie.
"Breakfast at Walmart will be an Oscar winning movie."
No, it will not. Audrey Hepburn is dead.
FYI I have 8 dogs and around 10 cats and order all the pet supplies online with free shipping including cat litter, lol. FedX hates me. Literally. I live in a remote area, considering, and am not on their route.
I told them that's their problem not mine. Anymore smashed boxes etc i'll be having your ass hung.
They just need to start renting out floor space: http://www.dailymail.co.uk/news/article-2723858/How-one-14-year-old-boy-...
And I still can never find a box of .22LR in stock at my local Walmart, and they limit sales on their other ammo too. Maybe they need to re-think their logistics, their product mix and their sales policies.
Maybe they dont need to expand anymore?
Dollar Tree is the new WallMart
That's true.....I stood in line for 1/2 hour to buy a bag of chips for a dollar.
I thought the line was going to speed up....but it didn't.
My local Dollar Tree is always full of BMWs and Mercedes in the parking lot.
I know the manager of a Walmart and Obama Care isn't the problem, No customers is the problem just like McDonalds and every other business in the US.
And who was "Everyone" predicting global growth. Isn't that those people no one believes.
My local mall is almost like a ghost mall on weekdays. Even weekends are slow. AAA rated stores are slowly closing one after another to be replaced by an odd assortment of tenants.
A race to the bottom for the 99%. More QE and printing. Doubling of the deficits from $17.7 trillion to $34 trillion.
Yeah, well it's not like Amazon has a problem with cap ex. Wal Mart looks to be going the way of K-mart here. "Make it up on price increases"? They should be singing the praises of good stamps then because those costs get passed right on to the Federal Government.
Americans will start raising their own chickens, "guerrilla gardening" in the Cities for the local restaurants. Wheat, corn, oil, "powerade"...just swimming in everything right now.
I saw the writing on the wall a few years ago. I've downsized as much as I can downsize, and moved out to the country on an acreage to do precisely what you mentioned. If I can reduce my grocery bill with homegrown products, which are far more healthy anyways, I would be stupid not to. Only one of my rural neighbors has a garden, but no livestock. The rest may as well be living in a suburb. I'm preparing for big increases in inflation in the next few years. The plan is to sell or barter any excess produce/meat/honey I make.
Once business tax revenues really tank, I expect the Federal government to impose higher taxes on the population. Seems to be more of a "when" then an "if" at this point.
Just interviewed for a high profile position at HQ.
They think their main competition is Amazon.
They think future growth is in China.
They are a mess of a Company.
May God help the residents of Bentonville & Rogers.
Don't get me wrong - they have plenty of cash, but no vision for the future.
They are at the peak of their life cycle.
I gues you didn't get the job.
I guess you didn't get the job.
Would you hire someone that can't throw to first base?
I'm pretty sure most of the folks in bentonville will be able to get by just fine on their cash reserves... however, as walmart goes, so will northwest arkansas. That area exploded when walmart demanded all its major vendors to have a local presence so walmart could deal with them locally... except that many people didn't see this as a one-off event and got out their ruler.... eventually leading to a housing crash, among other things, due to over building.
Walmart? Too snobby to shop there. I am up scale..j c penny's.
Wal-Mart has more problems than just the economy. Young college-educated idiots in there now fixing shit that ain't broke and pencil whipping numbers to make themselves a name in the hierarchy. Many longtimers that are left throwing up their hands.
So again, it's more than just the economy. Btw a 'little bird' tole me all this...
Just think: Obamacare hasn't kicked in for the majority of people yet. Next year is when we see maximum Obamacare pain on the economy.
WalMart used to be a marvel of logistics--every item was not only stocked, but fully stocked.
And, there used to be plenty of high (or at least adeqate) quality carefully selected products.
That was 10-20 years ago.
No place has been managed into the ground more than WalMart.
I'm sure Sam's family diversified out of their zillion-dollar holdings long ago.
Yesterday I was in grocery store and was walking past the lunch meat section when I noticed that the Ball Park Angus Hot Dogs were priced @ $6.39 per pack. I tend to do most of my family's shopping so I obviously have noticed that most products have increased in price at a rate of 20% over the last year, but $6.39 for a pack of Hot Dogs? If Walmart is doing poorly just imagine how other stores are doing.
you that you shouldn't be eating that bullshit anyway.
Never said I bought them, just shocked at the price. Of course they did have Hot Dogs for $1.29 a pack. Just imagine what they are made of.
Fuck WalMart. Like they are great for the US economy. If they gave a shit they wouldn't suck billions off taxpayers. They make 6 billion a year on food stamps from their own employees.
http://www.forbes.com/sites/clareoconnor/2014/04/15/report-walmart-worke...
Can't hardly walk through my local WM due to the aisles filled with cheap Busch beer at $9.99 a 30 pack.
I have trouble getting past the people with the 30-pack stomachs.
I've noticed more urine on the floor and screaming colored children at my Whole Foods, so I'm sure this is just a reflection of the population's shift from Walmart to Whole Foods that our recovery has enabled.
Grass-fed filet and wild salmon always tastes better when someone else is paying for it. FORWARD!
Mom-in-law had a 2,500 deductible hospital plan with BlueCross California for about $330 a month.
She was grandfathered into it.
Seems though BC wanted her and others like her pushed into ObamaCr*pCare as when the time people had to sign up for Cr*pCare, BC jumped her premium another 21 percent to the point her after tax income from her part time job (used to be full time) would not cover her BC premium.
So we got BC's Cr*pCare Bronze Plan for her. Because you, you and you over there...taxpayers would pay for her Cr*pCare. About $650/month of which she is billed a dollar. It is worth a dollar, but not much more. $5,000 deductible. BC gets about $8,000 per year in premiums (from taxpayers). Copay is hefty. Patient pays aboiut 35 percent. BC only pays 65 percent. And her BC Bronze Plan book is mostly about the wide variety of what they will not cover.
Good deal for BC and the other insurers who get to sell cr*p at gun point to the victims, er citizens. Instead of getting $300 and change for her coverage monthly, BC now gets a check for about $650 per month and she being low income, has a hard time coughing up the $5,000 annual deductible before BC will pay anything, for the limited items they cover, and 35 percent out of pocket is also a lot.
Obama Cr*pCare is kind of like the California Earthquake insurance the Calif Govt (a One Party State) created. The Earthquake insurance is high cost and low coverage, with a large deductible. I read the coverage terms and any reasonable person has to react with "WTF?!" Happily, no gun pointing at my head to buy that manure....yet.
Forced buying of this or that is SO anti-Constitutional. SO dictatorial.
We be the USSA now.
DK
p.s. btw, Mom-in-law got laid off from her part time job. Gets a little unemployment but as soon as benefits run out, she will no longer be unemployed per Ob*ma statistics. May be sitting at home or dumpster diving but at least she will no longer be adding to the official unemployment numbers.
In fact, per Ob*ma statistics, when everyone is permanently unemployed, Ob*ma can report the USSA is 100% employed.
p.s. Here in Mexifornia, the Free Sh*t Army is large. Wife needed some physical therapy for shoulder/upper arm. Local hospital bleeds red ink via the Free Sh*t Army (not all illegals) hits up their Emergency Room for any and all. (bring a book if you need go there...a thick one).
So the hospital has to screw over the paying patients. Wife priced the hospital's outpatient physical therapy service (outpatient, off site clinic)....about $400 for initial eval and about $300 for treatments.
Local independent physical therapy place...$150 for initial eval and $100 for (1 hour) teatments.
Now have to decide which place to go to....
duh?
Who broke the Health Care system? Maybe the Free Sh*t Army?
These people are broke
http://www.peopleofwalmart.com/
The Walton Family gave MILLIONS to the OBONGO campaigns of 2008 and 2012. This shows that often the spawn of truly good men are CRAP-COMMIES.
A walk through Walmarts in New England often show thin or non-existent traffic.
In those stores, Walmart sells groceries but can't seem to do anything with produce. Little offered and what is offered looks awful. Maybe hard to import from China.
Query when will the EBT community get smart and learn to prepare their own meals. When that crowd stops buying pre-packaged foods, the Walmarts of the world will be in deep trouble. Maybe they'll turn their stores into legalized weed outlets.