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9/13/13, "Consumer Confidence Collapses - Biggest Miss On Record," Zero Hedge
"This is the first consecutive monthly drop in 14 months and the largest miss vs expectations on record. Printing
at 76.8 (against an expectation of 82.0), this is the lowest in 5
months and points to the picture we have been painting of a consumer
increasingly affected by rising rates and soaring gas prices amid
stagnant incomes."...
---------------------------------------------
9/13/13, "CEOs Confess: Consumption, That 70% Component Of US GDP, Just Isn't There," Zero Hedge
"Following this morning's miss on retail sales and plunge in consumer confidence, Bloomberg's Rich Yamarone points out that retailers remain anxious about the outlook as they see consumers cautious and expect a spending slowdown.
The following quotes from some of the largest and most bellwether names
may help shed some light on the reality of the hope that is priced into
markets about consumption relative to actual business expectations...
perhaps best summed by Sealed Air's CEO, "we are in the fourth year of the recovery and it doesn’t feel like a recovery. Because it’s the first time ever that things, four years within a recovery, are feeling so iffy."
CVS [CVS] Earnings Call 8/6/13: “We are continuing to see a cautious consumer.
I think as you look across some of the external data available in the
second quarter, whether it’s IMS or some of the other data, it did show
some consumer spending slowdown in the quarter.”
Church & Dwight [CHD] Earnings Call 8/2/13: “I’ve
been a long-term pessimist about the business environment. The latest
forecast of weak GDP growth, continuing high unemployment and weak
same-store sales by major retailers provide little hope for significant
near-term improvement in the U.S. economy. In fact, of the 14
categories that Church & Dwight operates in, five incurred lower
category dollar sales in the second quarter versus the prior year, and
five more had category growth of less than 2 percent versus the prior
year. Now all consumer packages companies are fighting these headwinds.”
Brinker International [EAT] Earnings Call 8/2/13: “This quarter we continued to see a fairly lethargic category and some of the macroeconomic elements aren’t quite as good as we hoped
they’d be at this point in time. While we remain optimistic that the
back half of the calendar year will contain improvements in key metrics
like consumer confidence and employment, the restaurant industry isn’t recovering as fast as we had hoped
.”
Sealed Air Corp. [SEE] Earnings Call 8/2/13:
“This economy is not strong. I was listening to NPR this morning in the
car coming to the office and somebody was making the comment, saying
that we are in the fourth year of the recovery and it doesn’t feel like a
recovery. Because it’s the first time ever that things, four years within a recovery, are feeling so iffy.”"
==========================
9/13/13, "U.S. retail sales, consumer confidence point to soft economy," Reuters, by Lucia Mutikani
"Retail sales rise 0.2 percent in August, below forecast
* Consumer confidence falls in early September
* Producer prices up 0.3 percent on energy, but core flat"
"U.S. consumer confidence
ebbed early this month and retail sales advanced just slightly
in August, the latest indications of a lack of momentum in the
economy.
The sluggish pace of activity was underscored by another
report on Friday showing an energy-led rise in wholesale prices
last month, but subdued underlying inflation pressures.
The soft data, however, was unlikely to deter the Federal
Reserve from cutting its massive bond-buying program as early as
next week, analysts said.
"I don't think that's a red flag for the Fed. Overall the
data picture is mixed and supports our view that it will be a
light taper," said Thomas Costerg, a U.S. economist at Standard
Chartered Bank in New York.
The Thomson Reuters/University of Michigan's index of
consumer sentiment fell 5.3 points to 76.8 in early September,
the lowest since April. Economists pointed to worries over high
interest rates and a possible U.S. military strike on Syria.
Borrowing costs have risen sharply in recent months in
anticipation of the Fed scaling back its monthly bond purchases.
A separate report from the Commerce Department showed retail
sales rose 0.2 percent last month as Americans bought
automobiles and other long-lasting goods like furniture and
electronics and appliances.
But those purchases appeared to draw spending power away
from other areas and receipts for clothing, building materials
and sporting goods all fell.
Clothing store receipts dropped by the most in nearly 1-1/2
years, reflecting a slow start to back-to-school sales and
offering a cautionary note ahead of the holiday shopping season.
Nevertheless, it was the fifth straight monthly rise in
retail sales, which account for about 30 percent of consumer
spending. They had gained 0.4 percent in July and economists
polled had expected them to rise 0.4 percent last month.
Stripping out automobiles, gasoline and building materials,
so-called core sales were up 0.2 percent after rising 0.5
percent in July. Core sales correspond most closely with the
consumer spending component of gross domestic product.
Though core sales slowed a bit from July, they matched the
second quarter's 0.2 percent average monthly gain.
Avery Shenfeld, an economist at CIBC World Markets in
Toronto, said it appeared consumer spending was running close to
the 1.8 percent annual rate it logged in the second quarter."...
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