Caterpillar Suffers Worst Month Since Lehman, 26 Consecutive Months Of Declining Retail Sales

Tyler Durden's picture

Once upon a time, Caterpillar was the world's industrial bellwether and a Dow Jones Industrial staple. Lately, in addition to suddenly developing a very close relationship with Federal authorities who "are investigating the movement of cash among Caterpillar Inc. ’s U.S. and overseas subsidiaries", CAT has become a completely ignored and forgotten poster name of the "old-economy" (the on in which cash flow still mattered). However, there are those who still believe that the second coming "eyeballs" as the only valuation term category is destined to end in tears, and as such care about how companies like CAT do.

Sadly, we have some more bad news: Caterpillar just reported that in January, it suffered its worst retail sales month since Lehman, with global sales plunging 14% from last January (when sales in turn had dropped 8% from a year before, while the year before had slid 3% from the year before that and so on). In fact, January was so bad, it was the first month since 2013 when CAT reported declining sales across all regions in which it does business, now that the dead CAT bounce in North America is over.

 

Finally, those who disagree that the S&P500 is really only and just AAPL, will be even less pleased to learn that as of January CAT was now recorded a record 26 months of consecutive declining retail sales, which is now 7 months more than during the Great Recession period. This alone should make some wonder just how bad the unspoken depression the world is currently in, truly is?

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agstacks's picture

They can make it up in volume.

quintago's picture

If you like your recovery, you can keep your recovery

Buckaroo Banzai's picture

Whoa, whoa, whoa. Is Tyler suggesting that Obama is a lying sack of shit?

Theosebes Goodfellow's picture

What's the effin' surprise here? Did you think the Baltic Dry Index could tank and it not affect Catepillar? The BDI is the harbinger, baby. All the news, good or bad, spills from it. Look out for when potash shipping drops. Some folks won't be getting their supper. Literately.

bluskyes's picture

BDI: The last, functional, market beacon standing.

Groundhog Day's picture

Just buy the entertainment stocks and DIS, NFLX,  AMZN etal.  All the unemployed will sit at home, shop online, watch all the new shows and when they want to take a break and refresh they'll go buy a 6 dollar latte at SBUX so don;t forget them

Jlasoon's picture

Lots of construction going on in my neck of the woods (Central Florida). But my wife noticed something quite funny the other day. Big yellow construction equipment with Chinese writing all over them. Definitely not CAT, that's for sure. Never seen this type of equipment before. Couldn't stop starring, just caught me off guard. 

roddy6667's picture

Maybe Sany, Zoomlion, Longking, or XCMG. all Chinese. XCMG is in partnership with Caterpillar in China. Komatsu is king in China, followed by Hyundai and Daewoo/Doosan.

 

BuddyEffed's picture

CAT and BDI don't lie.  Declining inputs leads directly to declining outputs.

Clueless Economist's picture

My barber's Grandmother's Step-Grand Daughter makes $15 an hour working Starbucks in Seattle.  She only works 29.5 hours a week and after taxes gets a check for $993 a month.  For details on this great opportunity chcek out www.Krugman-Enron.com 

wendigo's picture

Bravo!

_ConanTheLibertarian_'s picture

So she makes ~ $1800 a month and keeps $993 ?

Guess I'm not doing that bad in heavily taxed Belgium then. I work 32 hours a week as a web developer and keep 75% of it.

Does she have deductions at all?

roddy6667's picture

Your barber's Grandmother's Step-Grand Daughter gave me an STD.

Theosebes Goodfellow's picture

That's what you get for sticking your dick in it and not wearing a slicker. Serves you right. Stop complaining.

confederacy of the dunces's picture
confederacy of the dunces (not verified) agstacks Feb 19, 2015 3:55 PM

Keeping my long position in "Lying Inc".

Spitzer's picture

They can make it up by  buying their own stock.

Unknown Poster's picture

The i-dozer will fix it all.

Headbanger's picture

But does it have the "Bury Banksters" app pre-installed?

mendigo's picture

Schroedinger economy.

Theosebes Goodfellow's picture

Say... Does that there Schroedinger economy come with or without a dead cat bounce? Let me guess...

BOTH!

wendigo's picture
wendigo (not verified) Feb 19, 2015 11:02 AM

By rights Caterpillar shouldn't be as sucessful as it is. It uses expensive union labor in the heart of the rustbelt, in old plants. Like automobiles, it should have built state of the art factories in the south where the labor is cheaper. Thus far Cat has mananged to survive by making products people want to buy, but it seems as though that is coming to a close. 

NotApplicable's picture

Maybe they're about to get a bunch of military contracts? Otherwise, why would Buffet be stupid enough to buy their stock?

roadhazard's picture

Cat just closed two plants, one in WNC and another in N. Ga. No unions there I can guarantee it.

bluskyes's picture

Who makes better construction equipment than CAT? John Deere construction equipment is shit, when it comes to working in gravel pits, and quarries.

Caterpillar also builds locomotive engines - they shut down a big plant in London, Ontario a couple of years ago - because the union wouldn't accept a pay cut, and moved all manufacturing to the US at a plant that hires $15/hr temps.

 

 

papaswamp's picture

That helps the Fed push off to H2 2016. Which will then be pushed to H1 2018.... Etc...etc...

neuronius's picture

Ha, Cramer said what about Catepillar recently? I bet that shill is eating his words now. I think he said something about their conference calls were the only ones he needed to hear to know what's going on.

Buckaroo Banzai's picture

He is "eating his words" all the way to the bank. Remember, he gets paid huge amounts of money to cheerlead this bullshit.

NotApplicable's picture

From what I hear, those words are all zero calories as well. So no there's no real issue with his actions.

lakecity55's picture

Check out Oshkosh (OSK):

http://www.marketwatch.com/investing/Stock/OSK?countrycode=US

Now, they do have a lot of military work. I had to hire on for a year to make armor between jobs. They do not seem to be doing so bad when I looked at the 5-years graph.

dobermangang's picture

They have around 6 billion in cash and 39 billion in debt according to Yahoo stats.  They probably should start conserving cash and end their dividend.  It's not like China needs to build anymore ghost cities.

roddy6667's picture

China is building homes for 300 million rural citizens. They will keep building and filling these homes no matter what the unscrupulous reporters say. They will use Japanese, Korean, and Chinese heavy equipment.

AbbeBrel's picture

Sooooooo

 

Whatever happened to all the "Shovel Ready Jobs" that Obie promised???    That *would* give CAT a boost, no?    So it goes in DC - Wall Street not Main Street.

Gotta love this comment:

“My next-door neighbor’s two dogs have created more shovel-ready jobs than this president,” Johnson said near the end of the debate.

http://www.politico.com/news/stories/0911/64232.html

Maybe it is time to change to the DJIA to the Dow Jones Old Fashioned Outsourced Average.  DJOFOA   Wait wait - no the Squid is in the INDUSTRIAL average?   We are saved!

SillySalesmanQuestion's picture

But, but, The Exaggerator-in Chief told us we have been in the "greatest recovery" since WWII...

buzzsaw99's picture

i'm surprised they haven't moved their factory to china by now. everybody else has.

roddy6667's picture

CAT is partners with XCMG. They will build a few and kick CAT out, continuing to copy CAT's design.

They do what's good for China. Does your country do what's good for you?

bluskyes's picture

They pay temps $15/hr to build their engines - how much cheaper would it be to build them in China?

What's the deal with CAT licensing? I see they are now into combines, and farm tractors - as well the local hardware store is now selling CAT branded inverters, and battery boosters. Maybe they can write off the brand dilution as a loss of goodwill.

localizer's picture

Am I wrong assuming that real value-added manufacturing companies like CAT are not quite reaping the benefits of the "recovery"? All the "growth" seems to be in the service industry (e.g. waiters and burger flippers), but you can always rely on real estate and derrivatives growth, right? And there's always the money printer available so it's all cool!

miker's picture

Lot of good used Cat equipment out there.  I think new sales will stink for a number of years.

localizer's picture

So you mean CAT makes quality stuff that lasts too long? How times have changed... it used to be all about quality... I guess cutting corners and making stuff that don't last more than 5 years is the new normal...

Fishthatlived's picture

I kinda feel sorry for Peoria, I lived there for a year or two. Nice people, but they will close up shop if Cat ever leaves. That is ALL they have.

Spectre's picture

Whenever Cat & Deere decide to quit fuking the customer, things might improve a skosh.  Im trying to buy a compact track loader from them, $60K or so.  They still elect to nickel and dime you to death, horn $225(looks like a $2.00 horn) back up camera $625 (thats BS) it goes on and on for items that should be std in the first place.

Steal Your Face's picture

The cost and hassle of repairing modern tractors has soured a lot of farmers on computerized systems altogether. In a September issue of Farm Journal, farm auction expert Greg Peterson noted that demand for newer tractors was falling. Tellingly, the price of and demand for older tractors (without all the digital bells and whistles) has picked up. “As for the simplicity, you’ve all heard the chatter,” Machinery Pete wrote. “There’s an increasing number of farmers placing greater value on acquiring older simpler machines that don’t require a computer to fix.”

The problem is that farmers are essentially driving around a giant black box outfitted with harvesting blades. Only manufacturers have the keys to those boxes. Different connectors are needed from brand to brand, sometimes even from model to model—just to talk to the tECU. Modifications and troubleshooting require diagnostic software that farmers can’t have. Even if a farmer managed to get the right software, calibrations to the tECU sometimes require a factory password. No password, no changes—not without the permission of the manufacturer.

New High-Tech Farm Equipment Is a Nightmare for Farmers
http://www.wired.com/2015/02/new-high-tech-farm-equipment-nightmare-farm...

bmr22's picture

Hate to say it but buy a Mahindra best tractor I have ever owned. 5 yr warrenty no plastic on it, always fires right up. Had it for 3 years now. Sure can't say the same for my x500 lawn mower nothing but nagging little problems and now the warrenty is gone so I think it will be going to this spring. I used to try and support usa built produts but now I look at what is going to last the longest and is the best value.

roddy6667's picture

The Agway where I used to live is a Mahindra dealer. The local farmers like them. That's a vote of confidence.

Colonel Klink's picture

Green shoots!  Recovery!  BULLSHIT!!  This is all now owned by OBAMA!  We have become an Obamanation.

(Insert the whole lying, Kenyan, narcissist, socialist descriptive string here)

Ban KKiller's picture

Many, many used equipment auctions all around. Why buy new when used is a screaming buy? This is a buyers market. Up with deflation! Down with inflation! Or do I have that ass backwards? Don't know as I have lost my reasoning due to downward pressure of the free markets. Ha-fucking-ha! 

Government needs you to pay taxes's picture

Is there an economic Depression app for that?