...incredibly warm weather for December throughout most of the country left many retailers looking for customers during the most crucial month of spending...
ac - a lot of people buy stuff FOR winter not in spite of winter. That is true for the northern third to half of the country.
Heck it takes a major blizzard & prolonged double digit below zero to keep people 'in'. If the car starts & the plows can get through - we can get out to the Malls if there is something we need/want to buy.
I talk to people in the snowmobile industry & the story with them is that if it doesn't snow heavily by Jan 1 - you can't give snowmobiles away even though in my part of the world the snowiest month is March (still months away).
Same thing applies with coats & boots and all that wintry kind of stuff - if you make it to mid-January on previous years stuff, even if worn, then you can make to to May or June when it warms up.
Up here by mid-February the 'spring fashions' will start coming out as will golf clubs & bikes, etc. Retailers will have thrown in the towel, raised the white flag and winter season sales will be 'lost' forever by then.
So warm weather really can be a downer from a sales perspective & a legitimate excuse - just depends on where in the country you live.
yes, but dryfly, shouldn't people not buying snowmobiles and heavy coats be buying...something? as soon as gas prices drop, other consumption increases.
i am hesitant reading too much into december sales because of the increasingly important role of gift cards, but i do have trouble believing the weather was too good so out of the blue, american consumers decided to...spend less....
yes, but dryfly, shouldn't people not buying snowmobiles and heavy coats be buying...something?
They bought stuff - just not as much...
I mean 'yah' you buy the everyday things & things not associated with a season just like every other day... but don't kid yourself, in parts of the country with very pronounced seasonal changes much of what we do for work & leisure is driven by what is either enjoyable or necessary as a result of the weather.
In a normal year our expenditures reflect this seasonality as well.
Have to go with dryfly on the impact of weather on winter sales. It isn't a guess. The pattern is clear. Cold years drive apparel sales. Money saved on apparel this year may slop over into other categories, but not right away.
My guess is that Wal-Mart did better because management had time to take action after a steady deterioration in y/y comparisons. That oughtright drop in November meant something had to be done.
And this morning I read (from Excite Money & Investing):
U.S. stock futures rose sharply to start the new year on Wednesday, as investors viewed strong sales data from Wal-Mart Stores Inc. over the weekend as a sign that the holiday shopping season was better than expected and also looked at a downturn in crude oil futures.
dryfly/k. harris: i'm not denying that weather drives certain forms of consumption (i used to live in the northeast myself), and i'm not going to claim that i've studied past decembers in years of mild weather to see if sales increased in some other category, and i've already noted that it's certainly not inconceivable that the money was spent on gift cards and we don't know it yet, and i'm certainly not going to take a guess as to whether we're going to see either credit-card debt drop or personal savings rise in december, but with all that said...
i continue to find it surpassing strange that in the biggest shopping season of the year, people said "i don't need a new winter coat so let me save the money this year."
Howard - I'm not suggesting they 'saved' the money but rather it is more like 'deferred spending'.
Stores only have so much shelf space and even less of it is 'prominent'. Its those prominent spots that move a lot of product - and can effect overall sales a few percent either way. That is all that is needed to move sales from 'robust' to 'anemic'.
Plus when the shopper goes in for the new coat, they also come out with new gloves, scarf, boots, hat, etc.
Or the guy buying a new snowmobile also gets a new snowmobiles suit, gloves, etc & books a weekend in Rhinelander Wisconsin.
None of that happens when the weather is warm...
And because the retailers have positioned winter articles in the most prominent spots - the other stuff that might sell in a warm up is buried in the back & doesn't move as quickly (fewer spontaneous 'trigger' buys).
I'm not saying in was go-no go sales vs saving... it all happens on the margins. And this clearly had an effect.
BTW - how warm has it been? I was up along the Canadian border in NW Minnesota just before the holidaze - the coldest spot in the lower 48 most days mid winter... it was in the low to mid 50s just about the whole week.
I've ice fished up there in the past this time of year and had to drill down through three feet of ice. Reports are that some lakes are still open.
Here in Southern Minnesota the weather forecast is for above freezing for the next week or so - some of those days the low is expected to remain above freezing. VERY unusual.
Happy New Year howard, (a greeting I need to and want to give)
i continue to find it surpassing strange that in the biggest shopping season of the year, people said "i don't need a new winter coat so let me save the money this year."
As far as the warm weather goes and how it discourages one from buying that beeauutiful parka that you didn't really need even in sub-zero weather on account of you already having 3 only slightly less beautiful parkas in the closet, it needs to also explain seasonal air traffic to warmer climates and also dropping auto sales, yes?
So I'm with howard or maybe a step or 2 braver: people are hearing that there is a slow down coming and getting cautious.
The usual Xmas trip in Florida/Mexico was passed over this year; that new F150 was passed over; that message to spend from the President was regarded with suspicion this time; the 'money in the bank' looking a little less secure than it once did.
grin - to repeat myself from earlier, I believe the recession started in November of 2006. The holiday sales funny business (especially the "we have to wait for gift card redemption to know for sure" part) is most of what's hiding it.
Of course, I'm willing to consider the fair chance that officially we'll have a stagnant or even a small positive GDP growth as various modifying assumptions are tweaked as necessary - thus avoiding official recognition of a recession.
Just for the record, I used a pre-holiday smell test of crowds at the stores - which were unimpressive. I've got a post-holiday confirming smell test I'll share as well. What were the return lines like? On December 26th in my neck of the woods, they were scant.
So I expect the final retail sales numbers to be unimpressive at best.
calmo, thanx for the new year's greeting and same to you.
to continue the discussion we really need more data.
calmo is braver than me: he (she?) is prepared to speculate that people are battening down the hatches (and certainly i've long been concerned that sooner or later, household debt would impinge upon consumption).
dryfly is speculating that the parka and the snowmobile didn't do it for me in december, but maybe i'll buy a new ipod in feburary and it will all normalize out.
and i'm prepared to say "i don't really know but i'm looking forward to seeing december credit card debt outstanding and household savings numbers when they appear, and i'm looking forward to seeing january and february sales numbers when they appear."
"an increase of 2.5% is dubbed anemic?" Sure, when the "official" inflation rate is higher than that and the real inflation rate (what people actually pay for stuff) is around 8% a year.
Won't be a good winter for snowmobile dealers. Last year was the worst in decades here in the Northeast and this year is even warmer. Early January, not a hint of snow and temperatures in the mid-50s. (Should be below zero with 60 inches of snow cover by now.) I guess the only thing worse would be selling Harley-Davidsons as the Home ATM runs out. At least our weather is screwing the oil traders.
It's interesting to see WMT performing relatively well, contrary to recent history.
I wonder if that means consumers are starting to trade down?
...incredibly warm weather for December throughout most of the country left many retailers looking for customers during the most crucial month of spending...
I guess the nice weather trapped people indoors.
I guess the nice weather trapped people indoors.
ac - a lot of people buy stuff FOR winter not in spite of winter. That is true for the northern third to half of the country.
Heck it takes a major blizzard & prolonged double digit below zero to keep people 'in'. If the car starts & the plows can get through - we can get out to the Malls if there is something we need/want to buy.
I talk to people in the snowmobile industry & the story with them is that if it doesn't snow heavily by Jan 1 - you can't give snowmobiles away even though in my part of the world the snowiest month is March (still months away).
Same thing applies with coats & boots and all that wintry kind of stuff - if you make it to mid-January on previous years stuff, even if worn, then you can make to to May or June when it warms up.
Up here by mid-February the 'spring fashions' will start coming out as will golf clubs & bikes, etc. Retailers will have thrown in the towel, raised the white flag and winter season sales will be 'lost' forever by then.
So warm weather really can be a downer from a sales perspective & a legitimate excuse - just depends on where in the country you live.
yes, but dryfly, shouldn't people not buying snowmobiles and heavy coats be buying...something? as soon as gas prices drop, other consumption increases.
i am hesitant reading too much into december sales because of the increasingly important role of gift cards, but i do have trouble believing the weather was too good so out of the blue, american consumers decided to...spend less....
I could tell by the amount of post Christmas trash sitting on the curb much less was purchased this year.
.morg, you didn't see my next door neighbor's house. I think they added 1% to retail sales by themselves!
Best Wishes.
yes, but dryfly, shouldn't people not buying snowmobiles and heavy coats be buying...something?
They bought stuff - just not as much...
I mean 'yah' you buy the everyday things & things not associated with a season just like every other day... but don't kid yourself, in parts of the country with very pronounced seasonal changes much of what we do for work & leisure is driven by what is either enjoyable or necessary as a result of the weather.
In a normal year our expenditures reflect this seasonality as well.
Have to go with dryfly on the impact of weather on winter sales. It isn't a guess. The pattern is clear. Cold years drive apparel sales. Money saved on apparel this year may slop over into other categories, but not right away.
My guess is that Wal-Mart did better because management had time to take action after a steady deterioration in y/y comparisons. That oughtright drop in November meant something had to be done.
CR,
Is it possible to break the bar graph based on refinance share of mortgage activity?
thanks you
And this morning I read (from Excite Money & Investing):
U.S. stock futures rose sharply to start the new year on Wednesday, as investors viewed strong sales data from Wal-Mart Stores Inc. over the weekend as a sign that the holiday shopping season was better than expected and also looked at a downturn in crude oil futures.
CR: Isn't the link to Barron's and not to Bloomberg? I can't view the article.
dryfly/k. harris: i'm not denying that weather drives certain forms of consumption (i used to live in the northeast myself), and i'm not going to claim that i've studied past decembers in years of mild weather to see if sales increased in some other category, and i've already noted that it's certainly not inconceivable that the money was spent on gift cards and we don't know it yet, and i'm certainly not going to take a guess as to whether we're going to see either credit-card debt drop or personal savings rise in december, but with all that said...
i continue to find it surpassing strange that in the biggest shopping season of the year, people said "i don't need a new winter coat so let me save the money this year."
maybe they did: future data will tell us.
Howard - I'm not suggesting they 'saved' the money but rather it is more like 'deferred spending'.
Stores only have so much shelf space and even less of it is 'prominent'. Its those prominent spots that move a lot of product - and can effect overall sales a few percent either way. That is all that is needed to move sales from 'robust' to 'anemic'.
Plus when the shopper goes in for the new coat, they also come out with new gloves, scarf, boots, hat, etc.
Or the guy buying a new snowmobile also gets a new snowmobiles suit, gloves, etc & books a weekend in Rhinelander Wisconsin.
None of that happens when the weather is warm...
And because the retailers have positioned winter articles in the most prominent spots - the other stuff that might sell in a warm up is buried in the back & doesn't move as quickly (fewer spontaneous 'trigger' buys).
I'm not saying in was go-no go sales vs saving... it all happens on the margins. And this clearly had an effect.
BTW - how warm has it been? I was up along the Canadian border in NW Minnesota just before the holidaze - the coldest spot in the lower 48 most days mid winter... it was in the low to mid 50s just about the whole week.
I've ice fished up there in the past this time of year and had to drill down through three feet of ice. Reports are that some lakes are still open.
Here in Southern Minnesota the weather forecast is for above freezing for the next week or so - some of those days the low is expected to remain above freezing. VERY unusual.
Happy New Year howard, (a greeting I need to and want to give)
As far as the warm weather goes and how it discourages one from buying that beeauutiful parka that you didn't really need even in sub-zero weather on account of you already having 3 only slightly less beautiful parkas in the closet, it needs to also explain seasonal air traffic to warmer climates and also dropping auto sales, yes?
So I'm with howard or maybe a step or 2 braver: people are hearing that there is a slow down coming and getting cautious.
The usual Xmas trip in Florida/Mexico was passed over this year; that new F150 was passed over; that message to spend from the President was regarded with suspicion this time; the 'money in the bank' looking a little less secure than it once did.
grin - to repeat myself from earlier, I believe the recession started in November of 2006. The holiday sales funny business (especially the "we have to wait for gift card redemption to know for sure" part) is most of what's hiding it.
Of course, I'm willing to consider the fair chance that officially we'll have a stagnant or even a small positive GDP growth as various modifying assumptions are tweaked as necessary - thus avoiding official recognition of a recession.
Just for the record, I used a pre-holiday smell test of crowds at the stores - which were unimpressive. I've got a post-holiday confirming smell test I'll share as well. What were the return lines like? On December 26th in my neck of the woods, they were scant.
So I expect the final retail sales numbers to be unimpressive at best.
calmo, thanx for the new year's greeting and same to you.
to continue the discussion we really need more data.
calmo is braver than me: he (she?) is prepared to speculate that people are battening down the hatches (and certainly i've long been concerned that sooner or later, household debt would impinge upon consumption).
dryfly is speculating that the parka and the snowmobile didn't do it for me in december, but maybe i'll buy a new ipod in feburary and it will all normalize out.
and i'm prepared to say "i don't really know but i'm looking forward to seeing december credit card debt outstanding and household savings numbers when they appear, and i'm looking forward to seeing january and february sales numbers when they appear."
an increase of 2.5% is dubbed anemic? i better stay away from those manic depressants!
"an increase of 2.5% is dubbed anemic?" Sure, when the "official" inflation rate is higher than that and the real inflation rate (what people actually pay for stuff) is around 8% a year.
Won't be a good winter for snowmobile dealers. Last year was the worst in decades here in the Northeast and this year is even warmer. Early January, not a hint of snow and temperatures in the mid-50s. (Should be below zero with 60 inches of snow cover by now.) I guess the only thing worse would be selling Harley-Davidsons as the Home ATM runs out. At least our weather is screwing the oil traders.
Can anyone say Global Warming?
Jeff Matthews Is Not Making This Up: Forsythias in Bloom