"Clearly A Negative Signal": BofA Shows Thanksgiving Spending Was Biggest Dud Since Lehman

Tyler Durden's picture

First it was Shoppertrak, then it was the National Retail Federation, then it was IBM, and now, with its own set of internal data, here is Bank of America slamming the door shut on US retail spending as a source of Q4 growth, and proving once and for all that the extended Thanksgiving-weekend, and the start to US holiday spending season, was the biggest dud since Lehman.

From BofA:

The BAC internal data showed a sluggish start to the holiday shopping season. Spending on BAC credit and debit cards over Thanksgiving and Black Friday declined 1.6% yoy. In order to restrict the sample to holiday-related spending, we are measuring “core control” sales, which nets out food services, gasoline, building materials and autos, making it a comparable sample to the Census Bureau’s data. While not as dismal as the 11% yoy decline reported by the National Retail Federation (NRF), our data supports the weak anecdotes.

 

This is how the data looks in context, courtesy of Goldman. As we said: biggest dud since Lehman.

Of course, it wouldn't be a conflicted sell-side firm whose year end bonus is dependent on boosting confidence in a global pyramid scheme if BofA didn't provide at least some silver lining. Which it did.

Although this is clearly a negative signal, it does not mean the overall holiday shopping season will be a bust, in our view. As Chart 1 shows, the NRF data has no correlation (actually an inverse relationship) with overall holiday sales from the Census Bureau. The BAC data historically have a better fit, since it measures actual sales unlike the surveys, but it still has fairly low forecasting power. There are a few reasons to advise caution when interpreting Black Friday sales. For one, measuring sales over a two-day period is naturally noisy, but particularly since retailers adjust the promotion schedule over the years. As we show in Chart 2, the promotions start earlier each year making the “door buster” deals of Black Friday less appealing. Moreover, the shift toward online shopping provides greater access to sales and incentives, also taking the focus away from Black Friday. The bottom line is that while we tempered our optimism, we still look for holiday sales to increase this year given the improving economic backdrop.

 

Well, at least BofA didn't use the NRF's idiotic "the economy is too strong for shopper to need a deal" excuse. As for the spin: yes, there is still hope. Because otherwise how would one explain spending slumping to recessionary levels at a time when the Departments of Truth would have everyone believe unemployment is the lowest in nearly a decade, while GDP is supposedly growing at a pace not seen since in years (the real story of America's "adjusted" GDP was explained here).

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Cognitive Dissonance's picture

"Missed it by >   that   < much."  -   Janet 'Maxwell Smart' Yellen

GetZeeGold's picture

 

 

29.5 hr/wk jobs. Obamacare. Amnesty.

 

Hello....is anybody out there?

 

"Since Lehman".....didn't those guys die or something?

knukles's picture

Come on, guys.  It's because of several mitigating factors.
First, it's rained for a few days in California.
Second, everybody stayed home worrying that that nuclear reactor in the Ukraine could have trouble.  Folks have fretted about that for months, now. 
Third, everything is coming up roses and happiness so all the girls, feeling liberated from their daily chores since all the illegals are going to even wipe our butts, pulled out their old Martha Stewart VHS tapes and are handcrafting Xmas presents form recyclables.

QUITCHURBITCHIN!

fucking morons... shits falling apart and the only panacea is moar propaganda.... might as well be the fucking end of days ...

PT's picture

Quick!!!  Give the banksters some moar bonuses!  They'll save us!

If only the plebs could borrow more money!  If only real estate was moar expensive!  Then it would be happy times again!

Stop panicking.  All that lack of spending means one thing.  People have lots of munny in their pockets and they're planning on spending it next week.

XAU XAG's picture

Trees don't grow to the sky

 

A strong wind and this tree will fall over!

Eyeroller's picture

It's gonna take a hurricane...  The house of cards is held together with printing superglue...

Incubus's picture

nah--it's held together by the glue made from the cattle that came before us.

Still, some pretty strong shit.

 

GetZeeGold's picture

 

 

Hillary Clinton knows cattle.....maybe we should ask her.

PT's picture

CLINTON ?  CUNTON?  The difference is a tiny little bit of white space.  Maybe use a square font sans serif too.

What?  Oh, nothing, I didn't - oh, did I type that out loud?

Headbanger's picture

Nahh.. Just the hint of a mild breeze will snap it like a straw now.

XAU XAG's picture

@Eyeroller

It's gonna take a hurricane...  The house of cards is held together with printing superglue...

 

 

If we combine the 2

The glue is contaminating (poison) the water the tree needs for growth thus killing it

TheMerryPrankster's picture

"green shoots" "ongoing recovery" "economic propaganda"

we never recovered, we never fixed the problems, we are between crashes, we are boned.

Cognitive Dissonance's picture

If the only 'fix' expected was to kick the can down the road, then your description above sounds like a rousing success.

Eyeroller's picture

We 'recoveried' some folks...

TruthInSunshine's picture

Black Friday to Grey Thursday to Cyber Monday to Cyber Week to Red December.

Take away the middle class, shrink down the % of the population that is able to afford to spend relatively easily on discretionary goods/services from roughly 45% (during the 1960s) to 10% (now; soon to be 5% after next bubble burst/crash), and you get...

...terminal decline.

The last 6 years has essentially been a debt-fueled re-inflationary period, from consumer borrowing (record debt levels) to corporate bond/debt issuance (record levels, to buy back shares), to governmental spending (record debt).

ZH Snob's picture

this is impossible.  my TV has assured me time and time again that we are in a recovery.

Cognitive Dissonance's picture

Your TV lies. The good news is since you believe everything your TV 'tells' you, it ain't a lie unless your don't believe it. The solution is just to open the mind, shut down the curiosity quotient and relax.

/sarc

knukles's picture

So it's kinda like watching porn? 
Good for a moment's bliss then back to reality of a raw, messy world.
BTW.....

Anybody but me ever notice how porn is allowed 24/7/365, no problemo on the net, etc?
Nothing done by TPTB to curtail it in spite of all their ramblings and bullshit about telling us how to live politically correct lives, etc?
Nope, not a whimper.

Know why?

It's the circus half of bread and circuses.

disabledvet's picture

My "credible news source" (CNN) is telling me screaming "burning the bitch down!" (to an angry mob which then proceeds to do just that) "is okay."

Mind you the ACTUAL burning is bad...but screaming at everyone to do it OTAY.

I laugh because this really is why people watch television actually. "Social Media" is indeed downright quiescent next to the Big Boys. God forbid if someone had come out before the verdict and asked for folks to be smart and not destroy anything!

Now excuse me while I go back to my 12th quarter of

No I really don't care about your "football" or your "Basketball" or your "baseball" or your God damn fucking "hockey" either.

Taxpayer financed rioting really isn't my thing...and Demon Lord Zirapton of Mythos really is my hero.

So there.

Incubus's picture

We are in a recovery.

 

Except, it's not you and I that are recovering.  It's "some other people."

 

 

TheMerryPrankster's picture

Then "WE" are not in a recovery, "THEY" are in a recovery, "WE" are in a nasty brooding long term depression. Also "WE" are getting raped by "THEM"

Incubus's picture

Just a matter of how you decide to officially group things.

 

I don't believe I belong to any sort of social group, but people readily group me amongst whatever they might assume I might be part of.

Like here: I don't really consider myself part of a "ZH" group, but by consequence of action(posting on this blog) I am considered a group participant.

"WE" are unfortunately part of the official "we."

Solution?  People need to open their eyes and get away from the teat. 

XAU XAG's picture

@ ZH Snob

this is impossible.  my TV has assured me time and time again that we are in a recovery.

 

 

This is impossible. My TV (President Trans Vestite) has assured me time and time again that we are in a recovery.

fixed it for you

j0nx's picture

Sales sucked. People knew they sucked. End of story. That and 29 hour weeks and stagnant to decreasing salaries over the past 6 years while expenses are up 30% in that time isn't helping shit either.

knukles's picture

Don't forget!
The costs of health insurance have skyrocketed with no doctors taking BammyKare plans, a shit load of additional taxes kicking in within 27 more days, and fines if you don't have it.

Clusterfuck deluxe that hasn't even hit, yet.

Plus, don't for get about that 1099 part whateverthefuck you're supposed to fill in for every transaction of $600 or more.
Every last single fucking transaction.

This guy's gonna be less popular than Carter's ratings subtracted from Bush's

PT's picture

People already "bought" up all the bargains at Ferguson.  They don't need to buy anything else till next year.

AccreditedEYE's picture

Has Jim Cramer been notified?

agstacks's picture

This includes CC's. That's why the numbers look week. You see, since the recovery has strengthened, people are using the stacks of cash they have and not their credit card. I think everyone will be surprised when the final, adjusted numbers are revealed.

-MSM

SickDollar's picture

instead of Black friday or cyber Monday. next year make it Cyber Sheeple Month (from Thanksgiving to Xmas)

PS: Make sure to give the sheeple a week off paid so they can spend the cash they do not have

knukles's picture

Half the fucking population's got 100% paid time off.

RaceToTheBottom's picture

But Spending Dud==Saving Boom

Success!!!!

Frolf's picture

Jesus' birthday season

TheMerryPrankster's picture

Jesus was actually not born in December per roman tax laws, since the whole manger thing occured on the way to pay the taxes.

Jesus' birthday was moved to december so it would occur at the time of an already celebrated holiday, the pagan winter festival of the winter equinox december 21st.

If jesus had a sister or a wife, we could celebrate her birth in June and thus have 2 sales cycles to keep the economy humming as we shop our way to armegeddon.

Religion may be the opiate of the masses, but shopping is a close second. work however remains the curse of the drinking class.

knukles's picture

Jesus was married to Mary and had kids.

My sponsor keeps asking me why I seem to think that I'm the last living descendent of JesusHFuckingChrist. 

agstacks's picture

Saving is the worst thing for this economy.

Eyeroller's picture

Those evil hoarders of cash (grandma and grandpa) need to be penalized more. 

overmedicatedundersexed's picture

why do ccard co's get 18% on money while I get .01%?? car loans, home loans, none near 0.01% seems some people's money is better than us common folk..anybody in DC seeing this and asking why are savers getting the rates we do? no noone in power wants to ask that question.

RaceToTheBottom's picture

People in Power have asked the question and are just fine with the present answer.

According to Old Yeller, you should just gather up some assets to solve the issue...

FuzzyDunlop21's picture

But the best thing for you

agstacks's picture

Just to be clear, I obviously don't believe saving is bad for a free market, capitalistic nation-  but a debt-based, consumeristic, nation where 70% of GDP is consumerism cannot stand savers.  

Ahoy Polloi's picture

We dudded some folks

youngman's picture

Its survival..not spending...people are only buying things to survive..food..housing..and maybe even health insurance..although I think many people are dropping that....they have car and school loans to pay off now too

Calculus99's picture

How about seeing BACs and AMEX's spending data for those Black type cards. Do you think they'll be down 1% year-on-year?

I don't think so....

I am Jobe's picture

Jesus wants Amerikans to go out and spend spend spend. Also don't forget your IPADS , Venue, Surface, Android, Iphone crap as well. 

rejected's picture

The corporation I work for just bough thousands of Ipads. Gonna make us more productive and efficient, they say. Our desktops and laptops are now obsolete, they say.

Then when it failed to do what it promised,,, use your laptops, they say.

knukles's picture

Betcha the IT/Marketing guy gets promoted.

silverer's picture

They still can go another round with the new "Thinker" device: a strap to your head computer that does the thinking for you.