The big story of the day is the continued drop in the dollar, which has fueled huge pops in stocks left for dead (see Caterpillar and IBM), industrial names, and commodities like oil and gold.   Not sure how long this persists, but it’s great for blue chips.  However, it’s chasing cash out of those hot money sectors, quickly.

The magic elixir that cheap gasoline was supposed to be is still not showing up in most of the economy, or at least not for retailers whether on the high or low end of the spectrum.   This morning, Ralph Lauren and Kohl’s (KSS) released financial news that has wrecked their share prices.

KSS issued an update on 4Q15 that now sees earnings per share $3.95 to $4.00, a significant decline from $4.40 to $4.60.  The company has been in trouble for some time and had been not-so-secretly looking for a buyer.  The cheaper price might make it more attractive, and soon they’ll be able to toss in the real estate angle, which works from time to time.

It’s clear we are back to the debate about the death of the department store.  It’s been a premature debate over the past decade or so, but one has to wonder if in the age of Amazon, if department stores are viable.  (Note: Amazon has announced it will not be opening book stores but exploring the retail experience.)   Even big box retailers, once touted as department store slayers, are looking more vulnerable.

KSS

Ralph Lauren has had major problems for some time that the new CEO hasn’t been able to fix.  I’m not sure that stuffy apporach works anymore or that young buyers with cash all want to feel like they’re at Cape Cod each day.

RL

It should be noted retailers announced 22,246 job layoffs last month up from just 6,699 a year earlier.  It’s a tough business, but there will be major brick and mortar winners.