Where The "Great Recovery" Is 25% Worse Than The "Great Recession"

Tyler Durden's picture

There was some hope last month that, after falling for two straight months at a -10% Y/Y pace, there would finally be some demand for the products of the one company that symbolizes (or at least used to) the strength of global industrial demand: Caterpillar, when it reported its first single-digit decline since July. Or, as the case may be weakness, because according to the just released November retail statistics, in the last month Caterpillar reverted to its double-digit declining ways, when not only did the dead cat bounce in the US end, with the Y/Y increase slumping back down to only 5% - the lowest since February 2014 - but the carnage in both Asia/Pac (i.e., China) and Latin America (i.e., Brazil) just got even worse, with retail sales crashing by 24% and 37% respectively.

 

And putting it in a bigger picture context, CAT's global sales have now declined for a record 24 consecutive months, thanks to the "Great Recovery." By comparison the number of months of consecutive declines during the great financial crisis? 19, which means that for CAT, the Great Recovery is now 25% worse than the Great Recession. And counting.

 

Luckily for holders of CAT stock (and the equity-linked compensation of its management), while the company can't "purchase" demand for its products and services, it sure can lever up its balance sheet and use the proceeds to purchases record amounts of stock.

Source: CAT

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screw face's picture

moar recovery.......

GetZeeGold's picture

 

 

I would say something....but I'm too busy laughing.

NoDebt's picture

If these guys were smart they would blame it on a 24 quarter consectuive string of "one time charges".  What are these dopes thinking?  They're leaving a ton of stock price appreciation on the table by not even coming up with a good bobble-head narrative.

sun tzu's picture

Blame it on the weather. Too cold or hot. Too rainy or dry. Too much or not enough snow

RacerX's picture

What's the matter? Recovery got your tongue?

post turtle saver's picture

you know, I'm a 10 year holder of CAT... in those 10 years, I've had:

- a 2:1 split

- share price increase of ~93%

- dividend increase from $0.205 (0.45%) to $0.70 (0.75%) per share

their cash flow is still fundamentally good... if you're willing to recognize that CAT is a cyclical stock, and you're willing to buy and hold for the long haul, odds are good that you'll be rewarded well

the fire sale at $24 a share in spring 2009 was certainly helpful, too... I have dry powder sitting around that lives for opportunities like that, gotta love panic sellers

malek's picture

Now adjust that for the 115% true inflation over those 10 years (7% anually before 2009, 9% since) and you barely broke even - which is not bad!

But now with Obamadontcare you're paying more taxes on dividends...

Philo Beddoe's picture

Iron Ore is the coal mine inside of the canary.  CAT is fucked, 

GetZeeGold's picture

 

 

Shovel ready jobs?

 

Yes we can?

 

Anything?

Philo Beddoe's picture

Shovel? Fuck that. People will be willing to dig with their hands soon enough. Them old farts working at Wal Mart should have told you so. 

madbraz's picture

example #1 of the great corrupted masquerade:  Oracle earnings "beat"

 

Oracle earnings and sales estimate as of July 11th (thank you, internet archives!):  EPS $0.74, revenues $9.72 billion

Oracle earnings and sales estimate as of earnings announcement:  EPS $0.68, revenues $9.51 billion

Actual Oracle "earnings":  EPS $0.69, revenues $9.6 billion

Oracle "surges 7$ to $44.3.

 

In summary, earnings are almost 10% lower than july estimates, revenues missed.  Stock is up 7% today and also up 7% since July.

KnuckleDragger-X's picture

Oracle runs on Larry Ellison's ego which is a strong match for Steve Jobs ego.....

ebworthen's picture

The Chinese have reverse engineered any CAT equipment they wanted to, and are now building it and shipping it to other countries in the BRICS and Asia.

The U.S. not buying CAT equipment because the "infrastructure spending" is on Wall Street not Main Street.

madcows's picture

how much of this is due to the "recession" and how much is due to increased competition?

CAT equipment is expensive versus some pretty good, and inexpensive alternatives... You gotta pay a lot for the CAT and Deere nametags.  Maybe people aren't willing to pay for the name anymore.

overmedicatedundersexed's picture

cat is rust belt stuff- ignore it and buy face book, now there's a co that sells what people want..crazy seems sane to the lemming investor class..they want co's with no production expense, few employees no over head..well who's gonna buy your stuff, why .gov and fed seem likely customers (face book & NSA) all run by yews by chance of course.

youngman's picture

And especially now with the strong dollar....Chinese knockoffs are big down here in Colombia....

Fun Facts's picture

The 2008 financial crisis is also known as the greatest wealth transfer in the history of the world.

Not one in 10,000 americans understand what has been done to them.

Lordflin's picture

And whose fault is that? They are drugged out, undereducated and mesmerized by TV and other media... And those who laugh are no better.

We have surrendered wisdom. Or rather, the new wisdom is that humans are anything we want them to be. Principles which have proven true over thousands of years are ignored. There is little left except to find a hole somewhere and attempt to overwinter.

Sad isn't it? Man appears to have such potential. In the end the meanness of his spirit always wins. Or another way to put it... death always overcomes life. It is the nature of this universe.

I think I have reached a point in my own life where 'leading indicators' have lost their meaning. I know where this is going, and I don't need Catapillar to show me. I feel for those of you who place your faith in this world. I mean that sincerely. You are clinging to a crumbling infrastructure and if there is hope in the material world... and I will have to say that thermodynamics are against you... then it is not for your generation. Your children... maybe...

Bastiat's picture

Strong dollar will accelerate the decline.

Ewtman's picture

Deflation is the monster that is creating the environment which is pressuring global companies. It's hard for most to understand because deflation hasn't been experienced before by anyone alive today. It's a stealthy enemy...

 

 http://www.globaldeflationnews.com/inflation-vs-deflation-part-1which-on...