The Retail Apocalypse Arriveth

Posted: May 12, 2017 in Uncategorized

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One leading expert believes that 400 of the country’s 1,100 enclosed malls will fail in the upcoming years. Of those that remain, he predicts that about 250 — or 20% — will thrive and the rest will continue to struggle with shrinking traffic and sales volumes.

sentinelblog

From the Daily Reckoning

BY DAVE GONIGAM

Well, well… The S&P 500 is down about half a percent as we write this morning. Which isn’t much in the scheme of things… but it’s the biggest daily drop in a month.

The “retail apocalypse” of which we’ve been saying much this month kicked into high gear this morning. Macy’s (M) delivered its quarterly numbers… and they deposited many feces on the bed.

Earnings were 24 cents a share… way off the “expert consensus” calling for 35 cents a share. Revenue also missed. And same-store sales are down 4.6%, compared with the typical Wall Street analyst’s guess of 2.7%.

At last check, Macy’s shares are down 14% on the day.

But wait! There’s more!

Kohl’s (KSS) delivered an earnings “beat”… but missed on revenue. And same-store sales dropped 2.7%, compared with expectations of 1.2%.

Gone are the days when Kohl’s could thrive…

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Comments
  1. tubularsock says:

    Maybe we could plant trees in asphalt pots.

  2. Possibly, Tube. The question is how to make a profit off it.

  3. “Mall anchors are challenged by an oversupply of retail space as customers migrate toward online shopping,”

    So, once again, the brick and mortar retail apocalypse is being blamed for the most part on online shopping, namely Amazon. Seriously??!!!

    I have lived in upscale areas and in down-on-their-luck areas and people in upscale areas are cautious and are shopping at thrift stores. They are not maxing credit cards out on Amazon. In Minnesota, we were elbow to elbow in thrift stores and those people were as well-heeled as anyone in this economy can be and yet, why were so many people who had the means to shop online, crowding into thrift stores and consignment shops? It is because they are wary thanks to what is going down and they see the writing on the wall and are spending less amidst all the uncertainly that is out there.

    And for those who are already down-on-their luck, they are spending what little money they have at the Dollar Tree and at other stores like Family Dollar, Dollar General and the like because they are paying over 50% of their income on rent and wondering what to do about health care. They don’t have any money to sit at home and peruse Amazon. Are these economists actually expecting to be taken seriously? Because they are just not facing reality and the reality is that brick and mortar stores are shuttering their doors in unprecedented numbers because of a cautious attitude by those who could spend a little more but are not and because the poor don’t have any money to spend beyond rent, food and utilities. Economists can attempt to pretend that all is still well because people are shopping in droves on Amazon but they need to get their head out of the clouds and come back down to earth and recognize that it so ain’t Amazon that’s benefitting from the brick and mortar apocalypse.

  4. Great point Shelby. Sometimes the lies and fabrication get so thick you really want to strangle someone. At times I wonder if this particular mythology (about online killing retail) doesn’t serve a second purpose – mainly to make middle class professionals blind to the majority, namely the minimum wage families who are one paycheck away from the streets. There’s immense pressure for middle class people to make out like they’re doing okay – and side with the ruling elite, rather than calling them out for their greed and immorality. I suspect this is how so many so-called liberal elites ended up supporting Hillary, the Democratic Party and their neoliberal globalist and war agenda.

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