After the close, there were horrendous earnings reports and comp-store numbers from T.J. Maxx (TJX Companies) and Dick’s Sporting Goods (DKS).
As the death spiral for brick-and-mortar retailers (those particularly attached to malls) shifts to a negative velocity – a term many mathematicians say it’s impossible but I say it’s wholly appropriate – there is a notion it means consumers aren’t spending. Consumers are spending as the paradigm partially shifts, where more people live for the moment along with increasing wages.
Last Friday, I pointed out the shift back to eating out versus buying groceries in the Retail Sales report; it is being corroborated by sharp moves in restaurant and bar stocks, including those that reported last night.
Mall traffic peaked in 2010 and declined by 50% through 2013, and has continued to decline since according to Cushman & Wakefield. At some point, there will be a play as new business models emerge from the ashes, but don’t confuse brick-and-mortar retailers as a proxy for the economy.
Moreover, we are traveling, eating out, and spending millions on concerts and movie tickets. In fact, I paid a king’s ransom for two tickets to the Eagles, Fleetwood Mac, Steely Dan, Earth Wind & Fire, Journey and Doobie Brothers concert in July.
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