Posted on 11/15/2007 10:44:46 AM PST by Hydroshock
NEW YORK (CNNMoney.com) -- The guessing game ended this week - consumer spending is slowing down as J.C. Penney became the latest retailer to confirm the trend.
"We're in a very difficult selling environment," J.C. Penney CEO Myron Ullman told analysts Thursday in a conference call to discuss the company's third-quarter results.
The call was monitored via Webcast in New York.
"We came out of September expecting a strong start for early fall. That didn't happen. This is the first time that we're seeing a real change in consumer sentiment," Ullman said.
Penney isn't the only one to be disappointed. Earlier this week, Home Depot (Charts, Fortune 500) and Wal-Mart (Charts, Fortune 500) both signaled their concern about a spending slowdown in the months ahead and into 2008. Penney's rival Macy's (Charts, Fortune 500) cut its fourth-quarter same-store sales estimate Wednesday.
Ullman blamed a combination of weak housing conditions, mortgage and credit market concerns, and what he called the "psychological effect of fuel prices" for eroding Penney's profit and sales last quarter.
(Excerpt) Read more at money.cnn.com ...
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I thought Wall Marts numbers were behind the huge stock market surge two days ago. What gives?
bump
Walmart had soso sales, but increase profits by stream lining scheduling and cutting costs.
The Reno City Council is screaming about retail sales been much lower than expected. Warning us about cutbacks in the near future.
Well then let me go shopping this weekend.
I’m just an average joe, no inside information, and I’m not an economist. Having said that, this is the most concerned I’ve been about the economy in a long time. With gas headed to $4/gal, it will take $80 to fill up most cars. Couple that with increases in home heating, and disposable income goes away fast.
“Couple that with increases in home heating, and disposable income goes away fast.”
...got that right!
I think fuel costs, thus price hikes in most necessities due increased shipping costs are taking too much otherwise expendable cash out of the pockets of Americans to the point they aren’t purchasing non essentials as they otherwise would. Oh yes some still prioritize their “Big Gulp” at the Convenience Store and feed the kids “Sugar Pops” rather than purchase quality foodstuffs, but that is a different matter isn’t it (The latter in anticipation of some asinine Contrarion as has been showing up at FR recently).
This causes me to anticipate a boom/surge in internet retail sales this Christmas Season.
“We’re in a very difficult selling environment,”
They say that every year, to downplay expectations.
It’s not even Thanksgiving yet. Snow forecast for the Midwest on Thanksgiving, will get the shopping sentiment fired up.
How about the reason for lower sales being that we are buying items from the internet. Its cheaper, no sales taxes, you don’t have to fight the crowds and its delivered right to your front door?
Thats what I’m doing this Christmas.
Or ... blame it on Bush! /s
Yep. Last night I was at work and I overheard to Cow-irkers talking as they were leaving. They were talking about the high cost of living, and one had a solution of applying for more credit. Oh well.
Sales are up, just not as much as they guessed.
- Target Corp (NYSE:TGT - News) same-store sales rose 4.1 percent
- Costco Wholesale Corp (NasdaqGS:COST - News) and BJ’s Wholesale Club Inc (NYSE:BJ - News) reported better-than-expected sales
- Wal-Mart reported a lower-than-expected 0.4 percent rise in monthly same-store sales at U.S. stores
- Saks Inc (NYSE:SKS - News) posted a better-than-expected 10.6 percent sales rise.
- Neiman Marcus reported an 8.5 percent increase in same-store sales revenue.
Sounds to me like the “more hurricanes this season” crowd. Considering the record spending over the past few years - Congress included - why shouldn’t we expect a bit of economic cooling - Congress excepted?
I think I’ll wait a few more weeks and get the retailers a bit more jumpy...I need to get a laptop (for that matter a new house too)and I will be shopping hard to find a great deal.
If I don’t find a deal...I’ll wait a bit longer.
Scratching head: Hmm, JCP should have figured out the drop in retail sles 9 months ago,
just by looking at their own earnings and stock price.
When gasoline prices go up 50% or more many in the middle class slow down retail discretionary
spending so they can continue to use their vehicles and heat theri homes.
They say inflation is not heating up, but darned everything I buy doesn’t cost me more every time I buy it. Bread has gone up by 35 percent recently. And on and on.
I am with you, I do my family’s grocery shopping and comparing the prices from last year to now I ahve come to the conclusion tha tthe inflation numbers are a work of fiction worthy of Stephen King.
They say inflation is not heating up, but darned everything I buy doesn’t cost me more every time I buy it. Bread has gone up by 35 percent recently. And on and on.
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