Recovery? We Have Tripled The Number Of Store Closings From Last Year...

Authored by Michael Snyder via The Economic Collapse blog,

Did you know that the number of retail store closings in 2017 has already tripled the number from all of 2016?

Last year, a total of 2,056 store locations were closed down, but this year more than 6,700 stores have been shut down so far. 

That absolutely shatters the all-time record for store closings in a single year, and yet nobody seems that concerned about it.  In 2008, an all-time record 6,163 retail stores were shuttered, and we have already surpassed that mark by a very wide margin.  We are facing an unprecedented retail apocalypse, and as you will see below, the number of retail store closings is actually supposed to be much higher next year.

Whenever the mainstream media reports on the retail apocalypse, they always try to put a positive spin on the story by blaming the growth of Amazon and other online retailers.  And without a doubt that has had an impact, but at this point online shopping still accounts for less than 10 percent of total U.S. retail sales.

Look, Amazon didn’t just show up to the party.  They have been around for many, many years and while it is true that they are growing, they still only account for a very small sliver of the overall retail pie.

So those that would like to explain away this retail apocalypse need to come up with a better explanation.

As I noted in the headline, there are 20 different major retail chains that have closed at least 50 stores so far this year.  The following numbers originally come from Fox Business

1. Abercrombie & Fitch: 60 stores
2. Aerosoles: 88 stores
3. American Apparel: 110 stores
4. BCBG: 118 stores
5. Bebe: 168 stores
6. The Children’s Place: hundreds of stores to be closed by 2020
7. CVS: 70 stores
8. Guess: 60 stores
9. Gymboree: 350 stores
10. HHgregg: 220 stores
11. J.Crew: 50 stores
12. JC Penney: 138 stores
13. The Limited: 250 stores
14. Macy’s: 68 stores
15. Michael Kors: 125 stores
16. Payless: 800 stores
17. RadioShack: more than 1,000 stores
18. Rue21: up to 400 stores
19. Sears/Kmart: more than 300 stores
20. Wet Seal: 171 stores

If the U.S. economy was really doing well, then why are all of these major retailers closing down locations?

Of course the truth is that the economy is not doing well.  The U.S. economy has not grown by at least 3 percent in a single year since the middle of the Bush administration, and it isn’t going to happen this year either.  Overall, the U.S. economy has grown by an average of just 1.33 percent over the last 10 years, and meanwhile U.S. stock prices are up about 250 percent since the end of the last recession.  The stock market has become completely and utterly disconnected from economic reality, and yet many Americans still believe that it is an accurate barometer for the health of the economy.

I used to do a Black Friday article every year, but I have ended that tradition.  Yes, there were still a few scuffles this year, but at this point the much bigger story is how poorly the retailers are doing.

So far this year, more than 300 retailers have filed for bankruptcy, and we are currently on pace to lose over 147 million square feet of retail space by the end of 2017.

Those are absolutely catastrophic numbers.

And some analysts are already predicting that as many as 9,000 stores could be shut down in the United States in 2018.

Are we just going to keep blaming Amazon every time another retail chain goes belly up?

What we should really be focusing on is the fact that the “retail bubble” is starting to burst.  In the aftermath of the last financial crisis, retailers went on an unprecedented debt binge, and now a lot of that debt is starting to go bad.

In fact, in a previous article I discussed the fact that “the amount of high-yield retail debt that will mature next year is approximately 19 times larger than the amount that matured this year”.  This is going to have very serious implications on Wall Street, but very few people are really talking about this.

Most stores try to stay open through Christmas, but once the holiday season is over we will see another huge wave of store closings.

And as individual stores close down, this will put a lot of financial pressure on malls and shopping centers.  Not too long ago, one report projected that up to 25 percent of all shopping malls in the entire nation could close down by 2022, but I tend to think that number is too optimistic.

The retail industry in the United States is dying, and the biggest reason for that is not Amazon.

Rather, the real reason why the retail industry is in so much trouble is because of the steady decline of the middle class.  The gap between the ultra-wealthy and the rest of us is greater than ever, and we can clearly see the impact of this in the retail world.

Retailers that serve the very wealthy are generally doing well, and those that serve the other end of the food chain (such as dollar stores and Wal-Mart) are also doing okay.

But virtually all of the retailers that depend on middle class shoppers are really struggling, and this is going to continue for the foreseeable future.

Most American families are either living paycheck to paycheck or are close to that level, and these days U.S. consumers simply do not have much discretionary income to play around with.  More hard working Americans are going to fall out of the middle class with each passing month, and that is extremely bad news for a retail industry that is literally falling apart right in front of our eyes.

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Michael Snyder is a Republican candidate for Congress in Idaho’s First Congressional District, and you can learn how you can get involved in the campaign on his official website. His new book entitled “Living A Life That Really Matters” is available in paperback and for the Kindle on Amazon.com.

Comments

SILVERGEDDON Pumpkin Tue, 11/28/2017 - 17:41 Permalink

Sorry dude, but retail is being buried by the lack of disposable income. Between recession replacement jobs being temp, minimum wage, and stripped of benefits, and paying for your fucking Obamacare fake news health care rip off, people don't have disposable income any more. The fucking elites killed the golden middle class goose jobs that laid the golden American consumer economy eggs fro the last 70 years.  All that is left is bones, feathers, and gristle.  

In reply to by Pumpkin

LightBulb18 ssgredux Tue, 11/28/2017 - 20:00 Permalink

You wouldn’t go to A mall because women do most of the shopping and the american white family that could get into the middle class in large numbers plus the Jews who got into the middle class in high percentages are far less common than they once were. Now we have single white gentile mothers and some Jewish ones as well, divorced families paying for two homes and two lives poorly, and most of the Jewish children being born to religious Jews who have nothing in common with the american lifestyle and dream. Also white males have much less ‘community connection’ with the non whites in the malls.If it wasn't for home, stocks and other asset appreciation, and ridiculous mortgage rates their would be A much smaller middle class economy.But I wonder if their are numbers for total retail sales. Should be since the author quoted the amazon percentage of sales compared to retail. Store closings may not be bad if they are crappy stores, but 3 times more store closings than any year including 2008 is far too great A number. The even wilder consideration is the massive increase in the size of the american population in the past 10 years. Even millions of welfare rolls result in some spending along with the home building for more section 8. In florida it seems like the population has gone up by at least 20% in the past 10 years, that works out to millions more people with little effect expanding the economy. amazon is only part of the online sales, also they get most of the electronic sales which brings in the foot traffic and the men who make bigger ticket purchases. It doesn't sound good. But I have no certain idea. which is the biggest problem, we don't believe nothing anymore. Not the economic numbers, not the media companies, not the government, with zero confidence that we will be facing the future gallantly with truth, fairness and legitimacy. Just waiting for this system to perish so life can move on to something more meaningful eventually. In G-d I trust.

In reply to by ssgredux

11b40 SILVERGEDDON Tue, 11/28/2017 - 18:36 Permalink

It is really a perfect storm that traditional retail is caught in.Yes, the Internet is part of it, and reduced disposable income, too, but there is more.America has been "over stored" for more than 30 years.  Simply too much retail space chasing after consumers, so a lot of these closings are actually overdue.The aging Boomer population no longer needs to buy very much.  In fact, a big problem for many is how to get rid of the stuff they already have.  The attic, and garage are busting at the seams, and many have rented storage space for the overflow.  Oh, and the kids don't want any of it.Fashion trends have changed, influenced to a degree by the lack of discretionary funds that younger shoppers have today.  It has become casual at all times, except when it is grunge.  This is cheap chic.There is a huge shift in what 'discretionary' spending goes to as well.  Just a decade ago, few people had a smart phone bill.  Since the advent of computers and the Internet, so much of our 'discretionary' funds are spent feeding these techno beasts.  Computers, Pads, Software, Printers, Paper, Ink, ISP payments, Security, Mice, Keyboards, etc.It is complicated.....and ugly for traditional retailers.

In reply to by SILVERGEDDON

cbxer55 11b40 Wed, 11/29/2017 - 00:33 Permalink

You damn zippy, skippy! Too damn many stores. CVS closing stores? Gee, I wonder why? I live in a not too large city, and there are three CVS, all within a few miles of each other. Same for Walgreens. Same for WalMart. Two Big box hardware places, Lowes and Home Depot a few miles apart, with a large ACE not too far from them (where I go). Never needed much anyways. That list of store closings above: I've never heard of most of them, let alone stepped foot in their doors. Most sell stuff I don't want or need. My parents just bailed on a house they can no longer afford. Falling apart at the seams and they are in their late 70's. They left a whole lot of stuff behind, and I don't want any of it.

In reply to by 11b40

RedBaron616 SILVERGEDDON Wed, 11/29/2017 - 08:48 Permalink

Nonsense. Look at these companies. High priced and low quality. That will kill you every time. After fighting traffic all week, why would I fight it again on the weekend to go shop? This is why online is taking off like gangbusters. I would kill an hour in round trip time to go shopping. Not worth it. I can go outside my door and go, "Hello, package!"

In reply to by SILVERGEDDON

Durandal Pumpkin Tue, 11/28/2017 - 17:52 Permalink

Pumkin hit the nail on the head. It's all going online, its pretty common now for people to walk into a store and scan a barcode with the amazon app to save money. Anyone opening a brick + mortar only store today better be a niche product or a high end brand. Sucks to be anyone owning malls/shoppping centers.

In reply to by Pumpkin

Zorba's idea GUS100CORRINA Tue, 11/28/2017 - 21:06 Permalink

Gus, these store closings aren't necessarily attributed to the "Company's" retail division... the Middle Class is beseiged by decades of the "Deep State-Globalist" Extraction Operation. Debt Slaves obsess over how to make all their "monthlys"...how to avoid sliding into the abyss with subsistence level wages and the nations denigrated currency. Add to that the 100 plus million Americans that are still of working age and out of the workforce...thats 100,000,000 lost consumers shopping at flea market style retail and garage sales. Amazon was created to scorch the remains of Small Business America.

In reply to by GUS100CORRINA

Full Court Lug… Pumpkin Tue, 11/28/2017 - 18:01 Permalink

Partly true, but the core of that story is that Amazon loses a ton of money on retail and always has. Tough for B&M to compete when they're up against a company that can sell goods at a -10% margin year after year and watch their stock go parabolic as a result. Arguably this is the real genius of Bezos, not that his company (ex-AWS) loses money, which any idiot can do, but that he can lose money for a decade straight and watch his company's stock quintiple for his trouble.

In reply to by Pumpkin

MoreFreedom Pumpkin Tue, 11/28/2017 - 23:17 Permalink

Agreed.  About 6% of the retail establishments have closed, but online sales now account for about 10% of the market.  Still, the economy isn't as good as even Trump would like it to be, or as good as he says it is. Here's the funny thing, it would be worse under Hillary (similar to Obama's claims he made the economy better than it would be, though in his case, it was much worse than he said it would be). 

In reply to by Pumpkin

Osmium Tue, 11/28/2017 - 17:35 Permalink

Must not have been anyone working at those stores.  All those closings and still the "unemployment rate" is 4.x%  Ya, I believe that.

KimAsa Tue, 11/28/2017 - 17:38 Permalink

Slow news day? Post Michael Snyder articles.

I’d much rather see some Mark Dice videos, Dan Bell’s Dead Mall Series or Dick Morris Lunch Alert. FTLOG.

fulliautomatix Tue, 11/28/2017 - 17:38 Permalink

Because the RE is being bundled up and sold to unsuspecting (deliberately mis-informed) investors. Still a profit to be made, even if it is a scam. Because it is a scam - true price recognition for this RE cannot be allowed to happen. Forward!

Panic Mode Tue, 11/28/2017 - 17:39 Permalink

People just go online. No need to queue for parking and pay for the stupid expensive parking fees. Shops just cannot afford the stupid rent and tax set by the local council. They know best to screw business and taxpayers lives.

Herdee Tue, 11/28/2017 - 17:46 Permalink

And why are they printing currency and running a trillion dollar deficit? It means there's not enough tax money to pays the bills. Dead beat broke.

juggalo1 Tue, 11/28/2017 - 17:47 Permalink

The number of store closings is only half the picture.  What is the occupancy%?  What is the overall retail sales number?  If Sears closes and Walmart opens that's one thing.  If Sears closes and the building is abandoned / dynamited that is a different story.

MuffDiver69 Tue, 11/28/2017 - 17:57 Permalink

Because at least 50%of retail stores have been a waste of time for years and internet surfing and then purchasing is more economical for everyone then the limited choices at these worn out stores..Plenty of retail has upped their game and are doing just fine..People constantly posting these articles are just another name to cross off the relevant list..

OCnStiggs Tue, 11/28/2017 - 18:00 Permalink

What a dumb article.Online shopping hits record numbers. Where did those shoppers come from? The pool of shoppers that used to go to the creepy malls.DUH.

CalifornianSeven Tue, 11/28/2017 - 18:13 Permalink

I think you have to look at the increase in large industrial distribution buildings in lieu of crazy mall rents - folks are shopping online.  Then, there's less spending money because we need to pay taxes so we can pay for the free shit army and put the children of illegals through college...

I Write Code Tue, 11/28/2017 - 18:14 Permalink

Nordstrodamus also forecast lower sales and closed a store near me ... I wonder if the entire mall will survive.  Have to turn the two anchor stores into big Lasertag games or something.