Consumers Safekeep Holiday Spirit in 2010

Now for the Hangover

While it looks like Americans spent a bunch more money than many expected this year, we wonder if the sharp drop in consumer confidence reported for December 2010 is a result of their day-after realization of overspending and/or undergifting.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

(Tickers: NYSE: XRT, NYSE: WMT, NYSE: PIR, NYSE: ETH, Nasdaq: HOFT, NYSE: HD, NYSE: LOW, Nasdaq: AAPL, NYSE: BBY, NYSE: LTD, NYSE: CHS, NYSE: ANN, NYSE: GPS, NYSE: M, NYSE: JCP, NYSE: JWN, NYSE: TJX, NYSE: KSS, Nasdaq: COST, NYSE: TGT, NYSE: WMT, Nasdaq: WTSLA, Nasdaq: HOTT, NYSE: AEO, NYSE: ARO, NYSE: ANF, NYSE: SAK, NYSE: TIF, NYSE: TLB, NYSE: LL, Nasdaq: BLDR, NYSE: FO, NYSE: LEG, NYSE: TPX, NYSE: AYI, NYSE: LZB, Nasdaq: SCSS, NYSE: ZZ, NYSE: FBN, NYSE: NTZ, Nasdaq: SHLD, NYSE: DDS, Nasdaq: BONT, Nasdaq: CPWM, Nasdaq: BKRS, Nasdaq: BEBE, NYSE: BKE, Nasdaq: CACH, Nasdaq: CMRG, Nasdaq: CATO, NYSE: CBK, Nasdaq: CTRN, NYSE: PSS, Nasdaq: DEST, Nasdaq: DBRN, NYSE: DSW, Nasdaq: FINL, NYSE: FL, Nasdaq: GYMB, NYSE: GES, NYSE: JCG, NYSE: JNY, Nasdaq: JOSB, NYSE: NWY, NYSE: JWN, NYSE: MW, Nasdaq: SYMS, Nasdaq: PLCE, NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ, NYSE: BAC, NYSE: GS, NYSE: MS, NYSE: JPM, NYSE: C, NYSE: WFC)

Consumers Safekeep Holiday Spirit in 2010

The latest consumer spending data released today covering holiday shopping activity showed Americans may have lost their jobs in 2010, but they retained their holiday spirit - perhaps at their own cost. Last week, we expressed concern about the weekly sales results, based on the data's benefit from the inclusion of Super Saturday and its absence from the prior year comparable. We expressed concern that the absence of Super Saturday from this week's same-store sales data, versus an inclusive prior year comparable might drive equal and balancing disappointment this Tuesday.

However, ICSC reported that same-store sales for the week ended December 25, increased 4.8% year-to-year. Redbook concurred, noting a 4.6% sales increase. It's important to remember though just how bad last year was. While the stock market had already recovered from the pit, the economy was mired in the mud at the bottom of it. Thus, consumers were not as enthused as investors, though they had certainly benefited from wealth restoral in stocks; at least those who had not sworn off the fever forever. The problem is that many had.

A thoughtful reader of our article at a syndicate site last week offered his view that the day off on Friday might balance out the weakness caused by the absence of Super Saturday from the data. The Christmas weekend was a three-day holiday both years despite the date upon which Christmas fell. However, last year, Christmas Eve fell on Thursday, a full work day, and this year it occurred on Friday, an off-day allowing for last minute shopping for all Americans. So, we thank our reader for pointing out an important offset to our concerns. We witnessed with our own eyes streets full of holiday shoppers Friday on the Upper East Side of New York City. This certainly saved the week.

We also wondered whether the fact that a great deal of Americans had already finished their holiday shopping was good news or bad for retailers, considering they had likely paid less this year while chasing early deals. In the end though, it appears the creative marketing that thrives within the retail sector allowed it to adapt and survive 17% underemployment. Even the blizzard that struck the population dense Northeastern US could not stymie retail marketers, who are extending after Christmas sales to fit. It also certainly helped that the government passed unemployment insurance extensions, giving confidence to folks hanging on the edge.

Today, MasterCard (NYSE: MA) Advisors' SpendingPulse, which measures all retail sales (not just credit purchases), said for the period extending from November 5 through December 24, sales increased 5.5%. The rate of growth compared against 2009's 4.1% holiday pace, and it marked the fastest in five years. However, rates of growth are relative to the base they are measured upon. That said, and despite the easy bar setting, this is still good news.

It just so happens that Consumer Confidence was measured and published by the Conference Board today for the month of December. Putting a damper on things, confidence moved against the trend of the sales data noted today. December's confidence index slipped to 52.0, against the prior period's revised 54.3 and economists' consensus forecast for 57.4 this month, as compiled by Bloomberg. It is likely that this news had the S&P Retail ETF (NYSE: XRT) down fractionally through the hour of publishing. Negative housing price data out of S&P Case Shiller certainly did not help either. Shares of Wal-Mart (NYSE: WMT), J.C. Penney (NYSE: JCP), Best Buy (NYSE: BBY) and Aeropostale (NYSE: ARO) are trading with only fractional variance at the hour of publishing.

We have to wonder if consumer confidence didn't deteriorate due to the perhaps season-swayed spending of Americans that they now regret, realizing only afterwards that they really couldn't afford it. Or maybe they are just bummed about the lesser gifts given and received this year, and the friends and family they had to cut out. I would not read too positively into spirited holiday shopping, as consumers are likely to remain tight-fisted due to necessity moving forward.



Article interests investors in: S&P Retail ETF (NYSE: XRT), Wal-Mart (NYSE: WMT), Pier 1 Imports (NYSE: PIR), Ethan Allen (NYSE: ETH), Hooker Furniture (Nasdaq: HOFT), Home Depot (NYSE: HD), Lowes (NYSE: LOW), Apple (Nasdaq: AAPL), Best Buy (NYSE: BBY), The Limited (NYSE: LTD), Chicos (NYSE: CHS), Ann Taylor (NYSE: ANN), The Gap (NYSE: GPS), Macy’s (NYSE: M), JC Penney (NYSE: JCP), Nordstrom (NYSE: JWN), TJX Company (NYSE: TJX), Kohls (NYSE: KSS), Costco (Nasdaq: COST), Target (NYSE: TGT), Wet Seal (Nasdaq: WTSLA), Hot Topic (Nasdaq: HOTT), American Eagle Outfitters (NYSE: AEO), Aeropostale (NYSE: ARO), Abercrombie & Fitch (NYSE: ANF), Saks (NYSE: SAK), Tiffany (NYSE: TIF), Talbots (NYSE: TLB), Lumber Liquidators (NYSE: LL), Builders Firstsource (Nasdaq: BLDR), Fortune Brands (NYSE: FO), Leggett & Platt (NYSE: LEG), Tempur-Pedic International (NYSE: TPX), Acuity Brands (NYSE: AYI), La-Z-Boy (NYSE: LZB), Select Comfort (Nasdaq: SCSS), Sleepy’s (NYSE: ZZ), Furniture Brands (NYSE: FBN), Natuzzi (NYSE: NTZ), Sears (Nasdaq: SHLD), Dillard’s (NYSE: DDS), Bon-Ton (Nasdaq: BONT), Cost Plus (Nasdaq: CPWM), Baker’s Footwear (Nasdaq: BKRS.OB), Bebe Stores (Nasdaq: BEBE), The Buckle (NYSE: BKE), Cache (Nasdaq: CACH), Casual Male (Nasdaq: CMRG), Cato (Nasdaq: CATO), Christopher & Banks (NYSE: CBK), Citi Trends (Nasdaq: CTRN), Collective Brands (NYSE: PSS), Destination Maternity (Nasdaq: DEST), Dress Barn (Nasdaq: DBRN), DSW (NYSE: DSW), Finish Line (Nasdaq: FINL), Footlocker (NYSE: FL), Gymboree (Nasdaq: GYMB), Guess (NYSE: GES), J. Crew (NYSE: JCG), Jones New York (NYSE: JNY), Jos. A Banks (Nasdaq: JOSB), New York & Co. (NYSE: NWY), Men’s Wearhouse (NYSE: MW), Syms (Nasdaq: SYMS), The Children’s Place (Nasdaq: PLCE), Bank of America (NYSE: BAC), Goldman Sachs (NYSE: GS), Morgan Stanley (NYSE: MS), J.P. Morgan (NYSE: JPM), Citigroup (NYSE: C) and Wells Fargo (NYSE: WFC).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Misunderstood Same-Store Sales Surge Offers Opportunity for Short Investors

Oversight Misled Retail Stocks Tuesday

An important calendar difference was missed by major media and expert analysts alike Tuesday. The oversight, and the later promotion of the wrong message by pundits, looks to have inflated same-store sales growth and provided a special opportunity for short investors over the near-term, especially in retail industry stocks.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

(Tickers: NYSE: XRT, NYSE: WMT, NYSE: PIR, NYSE: ETH, Nasdaq: HOFT, NYSE: HD, NYSE: LOW, Nasdaq: AAPL, NYSE: BBY, NYSE: LTD, NYSE: CHS, NYSE: ANN, NYSE: GPS, NYSE: M, NYSE: JCP, NYSE: JWN, NYSE: TJX, NYSE: KSS, Nasdaq: COST, NYSE: TGT, NYSE: WMT, Nasdaq: WTSLA, Nasdaq: HOTT, NYSE: AEO, NYSE: ARO, NYSE: ANF, NYSE: SAK, NYSE: TIF, NYSE: TLB, NYSE: LL, Nasdaq: BLDR, NYSE: FO, NYSE: LEG, NYSE: TPX, NYSE: AYI, NYSE: LZB, Nasdaq: SCSS, NYSE: ZZ, NYSE: FBN, NYSE: NTZ, Nasdaq: SHLD, NYSE: DDS, Nasdaq: BONT, Nasdaq: CPWM, Nasdaq: BKRS, Nasdaq: BEBE, NYSE: BKE, Nasdaq: CACH, Nasdaq: CMRG, Nasdaq: CATO, NYSE: CBK, Nasdaq: CTRN, NYSE: PSS, Nasdaq: DEST, Nasdaq: DBRN, NYSE: DSW, Nasdaq: FINL, NYSE: FL, Nasdaq: GYMB, NYSE: GES, NYSE: JCG, NYSE: JNY, Nasdaq: JOSB, NYSE: NWY, NYSE: JWN, NYSE: MW, Nasdaq: SYMS, Nasdaq: PLCE, NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ, NYSE: BAC, NYSE: GS, NYSE: MS, NYSE: JPM, NYSE: C, NYSE: WFC)

A Misunderstood Same-Store Sales Surge Offers Opportunity for Retail Stock Shorts

Loyal Wall Street Greek readers have gotten used to our regular debunking and uncovering of anomalies behind what can appear as strong economic data. Once again Tuesday, we uncovered an important and deflating detail that was overlooked and left out by every major business media outlet and even Wall Street's most respected retail sector stock analysts. This is a reminder of why you read the expert authored blog, Wall Street Greek.

When the International Council of Shopping Centers (ICSC) reported same-store sales Tuesday at a level that marked the best growth for the entire holiday shopping season, economists, strategists, analysts and portfolio managers alike got on television and radio and proclaimed the American consumer alive and well. Indeed, even I was left scratching my head, wondering why… for a second or two. After all, for the period ended December 18, same-store sales marked 1.7% growth, week-over-week, and 4.2% growth against the prior year comparable period. Redbook concurred, showing 3.8% year-to-year growth for the same period. The S&P Retail SPDR (NYSE: XRT) was up fractionally on the day, but Macy's (NYSE: M) moved 1.5% higher, while Target (NYSE: TGT) jumped 1.9% and Nordstrom (NYSE: JWN) gained 1.2%.

After researching the subject, I almost bought into the conclusion offered by some high-level industry folks. The big idea was that shoppers came out in force last week, packing in a good portion of their shopping during the period. The ICSC Index and report released Tuesday seemed to concur with this assumption, given that it showed 74% of consumers had finished their holiday shopping through December 18, which was up from 56.6% the week earlier. That surge in shopping activity could be behind some of the week's extraordinary growth. According to a Bloomberg article on the subject, Oppenheimer Analyst, Brian Nagle, seemed to agree. However, based on one important fact that most if not all of Wall Street and the business press missed, we have to disagree.

What Had Happened...

What the pundits and speak-easies missed was an important calendar difference between 2009 and 2010. Bloomberg Radio Host Kathleen Hays almost stumbled upon it when she asked an expert guest if the reason might be seasonal. He quickly and sternly stamped out that truth, saying it couldn't be seasonal, given that the growth was measured on a year-to-year basis. WRONG!!! Wrong! Wrong! Wrong! And shame on you Mr. Expert for leading Bloomberg's audience in the wrong direction by sounding like you knew what you were talking about. Kathleen, "The Greek" should have been your guest Tuesday. I know from my experience as an analyst, and from the advice given to analysts by a seasoned talking head back at my old firm, that it is widely believed that giving any answer to a television or radio interviewer is better than giving no answer. Wrong and unethical! Thus, many of the talking heads you see on TV answer confidently, when sometimes they are just regurgitating what they have read or heard somewhere else, or they are simply spewing out their best guess. In other words, sometimes the well articulated and seemingly sound advice of experts is completely baseless and hazardous for investors to buy into.

Super Saturday is the second most important shopping day of the year after Black Friday, with Cyber Monday and Christmas Eve likely on their heels. Super Saturday is the Saturday immediately preceding Christmas, but it does not always fall on the same calendar date each year, and this year a slight differential misled the entire market.

Christmas falls on Saturday this year, but it fell on Friday in 2009. Thus, Super Saturday fell on December 18th this year, and was measured in the latest week's same-store sales. However, last year, Super Saturday fell on December 19th, and so it was absent from this latest prior year comparable that the 4.2% growth climbed over; its impact will instead be seen in next week's report. Therefore, next week's same-store sales growth result has a good chance of falling short of expectations and disappointing investors, if our analysis does not restore market efficiency sooner than that. Given this week's message, or false message, investors who might have been misled into buying retail stocks Tuesday could regret their action shortly on market correction.

Other data and expert analysis seem to point toward trouble for the whole of the holiday shopping period. The National Retail Federation Survey released in the middle of the month noted that 62% of adults surveyed said they would spend the same amount of money or more this year than in 2009. This fact also seemed to enthuse a few fools Tuesday, especially while complementing the 4.2% inflated period growth. However, those of us who have a bit of math proficiency remind readers that if this is true, then 38% of shoppers will be spending less this year. That second bit of information, characterizing a large number of people who usually spend about the same amount every year, likely plays more importantly for retail revenues and profits… but not for headlines.

Retail guru, Jay Margolis, pointed out that consumers were following deals this year, and staying home if there were none. He noted desperate retailers' broad store-wide discounting late in the season but well ahead of Christmas, as shop managers seek to ensure the movement of inventory. Otherwise, retailers would be faced with excess, and need to discount even further post Christmas. This is a bad sign, and it means shop-keeps will be turning inventory, but at a lower ticket. That little ditty should keep revenues soft and profit margins tight come quarter end. Therefore, assuming the week's 4.2% growth doesn't coincidentally correlate with the direction and state of the sales season, then this potentially mistaken surge in retail shares could offer opportunity for short investors of retail sector stocks.



This article should prove interesting to investors in NYSE: PIR, NYSE: ETH, Nasdaq: HOFT, NYSE: HD, NYSE: LOW, Nasdaq: AAPL, NYSE: BBY, NYSE: LTD, NYSE: CHS, NYSE: ANN, NYSE: GPS, NYSE: M, NYSE: JCP, NYSE: JWN, NYSE: TJX, NYSE: KSS, Nasdaq: COST, NYSE: TGT, NYSE: WMT, Nasdaq: WTSLA, Nasdaq: HOTT, NYSE: AEO, NYSE: ARO, NYSE: ANF, NYSE: SAK, NYSE: TIF, NYSE: TLB, NYSE: LL, Nasdaq: BLDR, NYSE: FO, NYSE: LEG, NYSE: TPX, NYSE: AYI, NYSE: LZB, Nasdaq: SCSS, NYSE: ZZ, NYSE: FBN, NYSE: NTZ, Nasdaq: SHLD, NYSE: DDS, Nasdaq: BONT, Nasdaq: CPWM, Nasdaq: BKRS, Nasdaq: BEBE, NYSE: BKE, Nasdaq: CACH, Nasdaq: CMRG, Nasdaq: CATO, NYSE: CBK, Nasdaq: CTRN, NYSE: PSS, Nasdaq: DEST, Nasdaq: DBRN, NYSE: DSW, Nasdaq: FINL, NYSE: FL, Nasdaq: GYMB, NYSE: GES, NYSE: JCG, NYSE: JNY, Nasdaq: JOSB, NYSE: NWY, NYSE: JWN, NYSE: MW, Nasdaq: SYMS, Nasdaq: PLCE, NYSE: BAC, NYSE: JPM, NYSE: GS, NYSE: MS, NYSE: C, NYSE: PNC, NYSE: WFC.

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Holiday Shopping Spending in 2010

Topic of Debate

Are you spending more, less or the same amount of money for gifts this holiday shopping season versus last year?

There are a plethora of reports littering the pages of major publishers these days offering varying views of the health of this year's holiday shopping season. We suspect spending is down this year, considering the length of time too many of us have been unemployed or underemployed. Yet, we find retail stocks surging today on a report of strong same-store sales (be sure to see the article that follows this though, since we debunk that deceptive data).

The National Retail Federation Survey released in the middle of the December noted that 62% of adults surveyed said they would spend the same amount of money or more this year than they did in 2009. Looking at this same data from another perspective, perhaps 38% of those surveyed are going to spend less money this year, and this seems to be more important for retailers, in our view.

We thought we might take this opportunity to survey our readers and ask:

How is Your Holiday Shopping Spending Shaping Up in 2010?

DEBATE TOPIC ARCHIVE

This article should prove interesting to investors in NYSE: PIR, NYSE: ETH, Nasdaq: HOFT, NYSE: HD, NYSE: LOW, Nasdaq: AAPL, NYSE: BBY, NYSE: LTD, NYSE: CHS, NYSE: ANN, NYSE: GPS, NYSE: M, NYSE: JCP, NYSE: JWN, NYSE: TJX, NYSE: KSS, Nasdaq: COST, NYSE: TGT, NYSE: WMT, Nasdaq: WTSLA, Nasdaq: HOTT, NYSE: AEO, NYSE: ARO, NYSE: ANF, NYSE: SAK, NYSE: TIF, NYSE: TLB, NYSE: LL, Nasdaq: BLDR, NYSE: FO, NYSE: LEG, NYSE: TPX, NYSE: AYI, NYSE: LZB, Nasdaq: SCSS, NYSE: ZZ, NYSE: FBN, NYSE: NTZ, Nasdaq: SHLD, NYSE: DDS, Nasdaq: BONT, Nasdaq: CPWM, Nasdaq: BKRS, Nasdaq: BEBE, NYSE: BKE, Nasdaq: CACH, Nasdaq: CMRG, Nasdaq: CATO, NYSE: CBK, Nasdaq: CTRN, NYSE: PSS, Nasdaq: DEST, Nasdaq: DBRN, NYSE: DSW, Nasdaq: FINL, NYSE: FL, Nasdaq: GYMB, NYSE: GES, NYSE: JCG, NYSE: JNY, Nasdaq: JOSB, NYSE: NWY, NYSE: JWN, NYSE: MW, Nasdaq: SYMS, Nasdaq: PLCE, NYSE: BAC, NYSE: JPM, NYSE: GS, NYSE: MS, NYSE: C, NYSE: PNC, NYSE: WFC, NYSE: XRT.

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Free Cup of Coffee for National Coffee Day

This article is all about getting you your free cup of coffee for National Coffee Day. You'll find the important information on how to get that free coffee down the page, and so go get your cuppa jo!

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

(Tickers: Nasdaq: PEET, Nasdaq: GMCR, Nasdaq: SBUX, NYSE: MCD, Nasdaq: JAVA, NYSE: THI, Nasdaq: HAIN, Nasdaq: JMBA, Nasdaq: JSDA, NYSE: JVA, Nasdaq: JAVO, NYSE: UN, NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ)

Free Cup of Coffee for National Coffee Day

The stock market is open on National Coffee Day, in case you were wondering or were like Kramer from Seinfeld and thought you should have off on Arbor Day and such. Well, since it is National Coffee Day, and because we have a column we like to call "Today's Coffee," and given the dearth of economic reports today, we thought we would give you a special Coffee article, and directions to where to get that free cup of Jo today.

It's true, by the way. It really is National Coffee Day, a day in which we honor coffee, and drink it up manicly like usual of course. I drink at least four cups a day, after cutting back due to hallucinations.

Unfortunately, there will be no coffee shop hop today, like the annual bar hopping fun that occurs in my Upper East Side neighborhood every St. Patrick's Day, but there are a few retailers offering special deals and even free cups of coffee for the hooked on this very special holiday. Take advantage of it dear friends, and get some of your hard earned money back from the servers of our addiction.

The most important thing about National Coffee Day is that you can score yourself a free cup across the country if you are smart. I would look for more if I were you, but here are the free coffee deals we found for today:

• LaMars Donuts and Coffee – Get a free 12 ounce coffee on September 29th when presenting this free printable coupon at participating locations.


• Dunkin' Donuts – Stop by participating Dunkin' Donuts and receive a free cup of coffee. The company will also donate a portion of their sales to Special Olympic groups.


• Boca Java – Boca Java is offering free shipping today in honor of the holiday. Come on! You can do better than that!


• Java Café – Java Café will offer drinks at a 50 percent discount from 7 A.M. – 12:00 P.M. on the 29th.


• Starbucks – Nada! No! You won't get a free cup from Starbucks today according to every source I checked, including their website (Nasdaq: SBUX).


• McDonald's – No free deal from McDonald's either! Talk about missing an opportunity! I'm a little p'd at McDonalds these days, after they tried to charge me $1.40 for a cup the other night, even though I ordered food. Come on McDonald's. We want Greek friendly service. (NYSE: MCD)


• Tim Horton's - No Deal!!! (NYSE: THI)


• Peet's Coffee & Tea (Nasdaq: PEET): Saw no special deals!!!


• Green Mountain Coffee Roasters – No deal as far as we can see, and the company is in trouble with the SEC today too; the shares are down some 14%. Yikes!

Not all locations will be participating in the free or discounted offer. Call ahead or check the website for details.

The Mayo Clinic published this bit of relevant information for coffee lovers who care about how much caffeine their cuppa joe (Canadian editorial - we employ all sorts) contains:

1. Dunkin' Donuts, brewed, 16 oz (480 mL) 143-206
2. Generic brewed, 8 oz (240 mL) 95-200
3. Generic brewed, decaffeinated, 8 oz (240 mL) 2-12
4. Generic instant, 8 oz (240 mL) 27-173
5. Generic instant, decaffeinated, 8 oz (240 mL) 2-12
6. Starbucks Espresso, 1 oz (30 mL) 58-75
7. Starbucks Vanilla Latte, 16 oz (480 mL) 150

So that's why I like Dunkin' Donuts coffee so much! (will accept money from DD for this, or coffee I guess). By the way, The Greek has yet to decide on his favorite brand of Greek Coffee... Send Coffee!



Article interests investors in Nasdaq: PEET, Nasdaq: GMCR, Nasdaq: SBUX, NYSE: MCD, Nasdaq: JAVA, NYSE: THI, Nasdaq: HAIN, Nasdaq: JMBA, Nasdaq: JSDA, NYSE: JVA, Nasdaq: JAVO, NYSE: UN, NYSE: PEP, NYSE: GIS, NYSE: KO, NYSE: K, NYSE: CPB, NYSE: MJN, NYSE: CAG, NYSE: SLE, NYSE: SJM, NYSE: MKC, NYSE: RAH, NYSE: CPO, NYSE: DLM, NYSE: FLO, NYSE: DHS, NYSE: THS, Nasdaq: DMND, NYSE: GMK, Nasdaq: JJSF, Nasdaq: LNCE, NYSE: BGS, Nasdaq: FARM, Nasdaq: SMBL, Nasdaq: CMFO, Nasdaq: MGPI, Nasdaq: JBSS, Nasdaq: FEED, Nasdaq: CNGL, NYSE: OME, NYSE: ALN, NYSE: OFI, Nasdaq: KTEC, Nasdaq: SNAK, Nasdaq: TSTY, NYSE: FRZ, Nasdaq: GLDC, NYSE: NWD.

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Political Fervor Taints Consumer Confidence Numbers

Tainted Tea & the Confidence Numbers

While The Greek is concerned about the significant decline in consumer confidence, something we have been warning would threaten the housing market and the general economy, we also smell a rat in the survey. Consumers have good reason to be troubled, don't get me wrong, but seasonal factors may be playing a role now as well. One such seasonal is of the irregular sort, and of political taint.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

(Tickers: NYSE: XRT, NYSE: WMT, NYSE: PIR, NYSE: ETH, Nasdaq: HOFT, NYSE: HD, NYSE: LOW, Nasdaq: AAPL, NYSE: BBY, NYSE: LTD, NYSE: CHS, NYSE: ANN, NYSE: GPS, NYSE: M, NYSE: JCP, NYSE: JWN, NYSE: TJX, NYSE: KSS, Nasdaq: COST, NYSE: TGT, NYSE: WMT, Nasdaq: WTSLA, Nasdaq: HOTT, NYSE: AEO, NYSE: ARO, NYSE: ANF, NYSE: SAK, NYSE: TIF, NYSE: TLB, NYSE: LL, Nasdaq: BLDR, NYSE: FO, NYSE: LEG, NYSE: TPX, NYSE: AYI, NYSE: LZB, Nasdaq: SCSS, NYSE: ZZ, NYSE: FBN, NYSE: NTZ, Nasdaq: SHLD, NYSE: DDS, Nasdaq: BONT, Nasdaq: CPWM, Nasdaq: BKRS, Nasdaq: BEBE, NYSE: BKE, Nasdaq: CACH, Nasdaq: CMRG, Nasdaq: CATO, NYSE: CBK, Nasdaq: CTRN, NYSE: PSS, Nasdaq: DEST, Nasdaq: DBRN, NYSE: DSW, Nasdaq: FINL, NYSE: FL, Nasdaq: GYMB, NYSE: GES, NYSE: JCG, NYSE: JNY, Nasdaq: JOSB, NYSE: NWY, NYSE: JWN, NYSE: MW, Nasdaq: SYMS, Nasdaq: PLCE, NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ, NYSE: BAC, NYSE: GS, NYSE: MS, NYSE: JPM, NYSE: C, NYSE: WFC)

Political Fervor Taints Consumer Confidence Numbers

Consumer Confidence sank to a mark of 48.5 in September, according to the Conference Board, which reported the news this morning. The data marked a new low, down from 53.5 in August. In fact, the index has shed 14.2 points since May. Economists were shocked by the degree of depression, with Bloomberg reporting the consensus expectation for the data point at 52.0. Considering that consumer confidence and spending is critical to the US economy, you should be paying close attention to this news.

The Horrible Truth

Consumers have had plenty good reason to sour, including a stagnant and sad labor market. With little new hiring occurring, surely the unemployed are growing increasingly depressed. Depression is certainly a good describer of just how hopeless the survey participants seem to be feeling. Their view of current conditions deteriorated in this latest check, with the Present Situation Index slipping to 23.1, from 24.9 in August. Still, it is their view of the future that should bother you more. The Expectations Index dropped precipitously, to 65.4, from a higher ledge of 72 last month.

The Director of the Conference Board said, "Overall, consumers' confidence in the state of the economy remains quite grim. And, with so few expecting conditions to improve in the near term, the pace of economic growth is not likely to pick up in the coming months." Regarding the present situation, those viewing business conditions as "bad" increased to 46.1%, from 42.3% previously. Only 8.1% said business conditions were "good." With regard to the job market, the number claiming jobs were hard to get depicted a dire environment as well.

Expectations

The American household outlook is indeed grim, and we can find no better descriptor. The percentage of people expecting business conditions to worsen increased, as did the number anticipating fewer job opportunities. This future outlook can have a dramatic impact on spending, because as Americans worry about income and wealth, they will spend cautiously.

Seasonal Impact?

Indeed, back-to-school shopping can have a way of reinforcing the inadequacy of an unemployment check. As such, we expect survey participants were a little more stressed than usual in September.

Conspicuously, we wonder what degree of impact political passions had in influencing the responses of Republican respondents during this special fall month. While things are bad, we can understand easily how worse they can seem by turning on C-SPAN to catch Republican House Leader John Boehner giving a speech. Or, you could switch on Fox television. Active Republican election campaign staffers and simple backers are surely included in the 5,000 households surveyed by the Conference Board, and so as we near November elections, their fervor is no doubt intensified. Perhaps they are also captured in these numbers...

I would assume any self-respecting Republican would express their complete discontent with the state of the economy now, given the other party runs the show today. So, while we see good enough reason for further deterioration in confidence, we warn that there may also be a taint to the tea in this particular reading.



This article should prove interesting to investors in NYSE: PIR, NYSE: ETH, Nasdaq: HOFT, NYSE: HD, NYSE: LOW, Nasdaq: AAPL, NYSE: BBY, NYSE: LTD, NYSE: CHS, NYSE: ANN, NYSE: GPS, NYSE: M, NYSE: JCP, NYSE: JWN, NYSE: TJX, NYSE: KSS, Nasdaq: COST, NYSE: TGT, NYSE: WMT, Nasdaq: WTSLA, Nasdaq: HOTT, NYSE: AEO, NYSE: ARO, NYSE: ANF, NYSE: SAK, NYSE: TIF, NYSE: TLB, NYSE: LL, Nasdaq: BLDR, NYSE: FO, NYSE: LEG, NYSE: TPX, NYSE: AYI, NYSE: LZB, Nasdaq: SCSS, NYSE: ZZ, NYSE: FBN, NYSE: NTZ, Nasdaq: SHLD, NYSE: DDS, Nasdaq: BONT, Nasdaq: CPWM, Nasdaq: BKRS, Nasdaq: BEBE, NYSE: BKE, Nasdaq: CACH, Nasdaq: CMRG, Nasdaq: CATO, NYSE: CBK, Nasdaq: CTRN, NYSE: PSS, Nasdaq: DEST, Nasdaq: DBRN, NYSE: DSW, Nasdaq: FINL, NYSE: FL, Nasdaq: GYMB, NYSE: GES, NYSE: JCG, NYSE: JNY, Nasdaq: JOSB, NYSE: NWY, NYSE: JWN, NYSE: MW, Nasdaq: SYMS, Nasdaq: PLCE, NYSE: BAC, NYSE: JPM, NYSE: GS, NYSE: MS, NYSE: C, NYSE: PNC, NYSE: WFC.

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

CPI Favors Trade-Down Stock Plays

Got a Hot One for Ya!

A common thread of insight runs through the Consumer Price Index data. The wisdom is that consumers continue to trade down. We saw it initially in the market share gains of Wal-Mart (NYSE: WMT) and the dollar store chains. We continue to see it in the CPI for August, with used auto sales soaring. Thus, we've decided to do some research for you, and find you some trade-down stock plays that haven't been played out.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

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CPI Favors Trade-Down Stock Plays

There is a common thread running through the Consumer Price Index (CPI) for August. We see price increase in certain industries that share this common characteristic, and where demand for goods is actually on the increase. As consumers suffer through the worst recession in generations, they are increasingly looking for bargains and cheaper options generally. For instance, the average price tag on a used vehicle is up substantially this year. Similarly, rents are on the rise, or will be. Thus, we believe that the same reason discount retailers are stealing market share, is a catalyst for other businesses as well. That's why we are looking for new opportunities for investors to exploit the trade-down stock play.

Many might argue that the trade-down play is played out, with discount store retailers like Wal-Mart (NYSE: WMT), Costco (Nasdaq: COST) and Dollar Tree (Nasdaq: DLTR), having already benefited from capital flows. Admittedly, we were already looking ahead for the opportunity to lead the change in trend in the other direction. That's why we missed the opportunity to publish our prepared short call on Sears (Nasdaq: SHLD) earlier this year, which we anticipated would see shoppers moving out of its Kmart stores. However, as the recession drags on and it becomes clear that the economy will be mired in this mess for a long while to come, we are taking a look again at the trade-down play, especially in industries outside of regular retail.

First let's review the Consumer Price Index (CPI), which inspired the idea:

Following yesterday's favorable PPI report, the Bureau of Labor Statistics reported on the Consumer Price Index for August today. While yesterday's data covered producers, this measure is closer to the hearts of economists and policy makers, with their ear attuned to the rail for sounds of deflation these days.

Regular readers of the Consumer Price Index (CPI) Report focus on two bottom line data points. The Headline CPI metric aggregates consumer prices without adjustment for the significant swings in prices for food and energy, whereas the Core CPI weeds out those two factors, to provide the public with a more applicable inflation gauge.

The Headline Consumer Price Index increased a seasonally adjusted 0.3% in August, which was in line with economists' forecasts. This latest result compares against a seasonally adjusted increase of 0.3% in July as well. Removing seasonal adjustment shows a smaller 0.1% increase in the CPI in August. Moreover, the Headline CPI is only up 1.1% over the last 12 months; so much for inflation fears eh? (Canadians rubbing off on me)

Inflation Who, Inflation What?

Some of us expect inflation discussion will again rise to the fore over the next couple years. Over the past year or four, when asked by friends and passers bye what to go long in, I would mention only gold. Even despite the lack of inflation, gold is rising, I believe on bets for future inflation and on general currency devaluation across printing presses known as sovereign nations. I understand the near-term valuation question regarding gold though, which George Soros recently warned about as well; though his fund has a substantial holding in gold interests. It's a long-term favorite idea of mine now, while I would shy away from it near-term. At the same time, it's an asset that must be included in any diversified portfolio. It is our natural currency.

At the Core

Like in July, the energy component of the CPI played a key role in driving the substantial price rise. The overall energy component rose 2.3% in August, so that the removal of energy and food prices led to an unchanged Core Consumer Price Index. This matched against a 0.1% increase in July and also against economists' forecasts for the same gain this latest month. Before August, Core CPI had risen three months in a row.

Since the change in the trend for the Core CPI matched the change in its Shelter Index component, we point toward housing price softness as the key to overall price change here. For months now, we have been scribbling that housing would take a double-dip, and that prices would come again under pressure. This is due to the fact that the labor situation persists, and offers no support to change what labors housing. Meanwhile, financing has become significantly difficult to obtain, while fewer folks could qualify now even under the old standards. Within the shelter component, the index for rent declined 0.1%, its first decline since November of last year though. The index for owners' equivalent rent was unchanged and the lodging-away-from-home index fell 1.3%. I look for rents to hold steady and rise even further as demand for rentals increases, especially in the lower half of the market.

Looking more closely at energy prices, each individual source saw increase, with gasoline marking the sharpest. The Bureau reports that gasoline prices rose about 3.9%. Still, over the last 12 months, the price of gasoline is only up a net 4.4%, due to earlier declines. Fuel oil prices increased 0.9% (up 10.6% over last 12 months), and the cost of natural gas service increased 1.1% in August.

Food prices, which had declined in July, increased 0.2% in August. However, the cost of food eaten in homes remained stable, while the cost of eating out rose 0.3%. Fruit and vegetable prices rose 0.4% in August after a series of recent declines, and the indexes for cereals and bakery products, and for other food at home, also posted slight increases. In contrast, the proteins moderated, with the index for meats, poultry, fish, and eggs falling 0.3%. This ended a string of seven consecutive increases. The indexes for dairy and related products and for nonalcoholic beverages both fell slightly.

New vehicle prices increased 0.3% in August, much more than any rate recorded dating back to at least February. The price of used vehicles increased even more in August, up 0.7% last month. Over the last 12 months, the price for used cars has increased 15.5%. Apparel prices slipped modestly, while transportation and medical care costs increased. I'm guessing every Republican reading this will jump on it as an opportunity to attack Obama care.

The Take Away

This latest CPI report unveils an important trend that we could not help but take note of. Similarly to how consumers have traded down, visiting the mall less for trips to Wal-Mart (NYSE: WMT), Costco (Nasdaq: COST) and other discounters for necessities and everything else, the same drivers have led consumers to trade down in other markets. The price of used vehicles has skyrocketed this year, and this is obviously due to greater demand for cheaper used cars, which should be stealing market share from the new car market. That would also lead one to consider investment in the care of vehicles, and toward a company like Pep Boys (NYSE: PBY) for instance (depending on company specifics). In housing, the price of rent has been on the rise, and should continue rising, especially at the lower end of the scale. Thus, there should be other opportunities to exploit the "trade-down" stock play. Do you have any ideas?

We are officially starting a series of articles entitled "Trade-Down Plays," through which we intend to discover and present to you ideas for potential investment. In this series, we will go a step further than just presenting a name. We will use our expert equity analysis skill to vet these investment ideas for company specific concerns and valuation, and determine whether "The Greek" would have rated the specific security a buy, sell or hold in his old stock research days.



This article should prove interesting to investors in NYSE: PIR, NYSE: ETH, Nasdaq: HOFT, NYSE: HD, NYSE: LOW, Nasdaq: AAPL, NYSE: BBY, NYSE: LTD, NYSE: CHS, NYSE: ANN, NYSE: GPS, NYSE: M, NYSE: JCP, NYSE: JWN, NYSE: TJX, NYSE: KSS, Nasdaq: COST, NYSE: TGT, NYSE: WMT, Nasdaq: WTSLA, Nasdaq: HOTT, NYSE: AEO, NYSE: ARO, NYSE: ANF, NYSE: SAK, NYSE: TIF, NYSE: TLB, NYSE: LL, Nasdaq: BLDR, NYSE: FO, NYSE: LEG, NYSE: TPX, NYSE: AYI, NYSE: LZB, Nasdaq: SCSS, NYSE: ZZ, NYSE: FBN, NYSE: NTZ, Nasdaq: SHLD, NYSE: DDS, Nasdaq: BONT, Nasdaq: CPWM, Nasdaq: BKRS, Nasdaq: BEBE, NYSE: BKE, Nasdaq: CACH, Nasdaq: CMRG, Nasdaq: CATO, NYSE: CBK, Nasdaq: CTRN, NYSE: PSS, Nasdaq: DEST, Nasdaq: DBRN, NYSE: DSW, Nasdaq: FINL, NYSE: FL, Nasdaq: GYMB, NYSE: GES, NYSE: JCG, NYSE: JNY, Nasdaq: JOSB, NYSE: NWY, NYSE: JWN, NYSE: MW, Nasdaq: SYMS, Nasdaq: PLCE. Inflation traders may have interest in a few publicly traded master limited partnerships: Alliance Resource Partners L.P. (Nasdaq: ARLP), Alliance Resource Holdings (Nasdaq: AHGP), Atlas Pipeline Partners L.P. (NYSE: APL), Atlas Pipeline Holdings (NYSE: AHD), Atlas Energy Resources (NYSE: ATN), Boardwalk Pipeline Partners (NYSE: BWP), Breitburn Energy Partners (Nasdaq: BBEP), Buckeye Partners (NYSE: BPL), Buckeye Holdings (NYSE: BGH), Calumet Specialty Products (Nasdaq: CLMT), Capital Product Partners (Nasdaq: CPLP), Cheniere Energy Partners (AMEX: CQP), Constellation Energy Partners (PCX: CEP), Copano Energy (Nasdaq: CPNO), Crosstex Energy (Nasdaq: XTEX), DCP Midstream Partners (NYSE: DPM), Dorchester Minerals (Nasdaq: DMLP), Duncan Energy Partners (NYSE: DEP), Eagle Rock Energy Partners (Nasdaq: EROC), El Paso Pipeline Partners (NYSE: EPB), Enbridge Energy Partners (NYSE: EEP), Encore Energy Partners (NYSE: ENP), Energy Transfer Partners (NYSE: ETP), Energy Transfer Equity (NYSE: ETE), Enterprise Products Partners (NYSE: EPD), Enterprise GP Holdings (NYSE: EPE), EV Energy Partners (Nasdaq: EVEP), Exterran Partners (Nasdaq: EXLP), Ferrellgas Partners (NYSE: FGP), Genesis Energy (AMEX: GEL), Global Partners LP (NYSE: GLP), Hiland Partners (Nasdaq: HLND), Holly Energy Partners (NYSE: HEP).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Consumer Sentiment Marks Apocalyptic 66.6

Morning Greek
Greek Factor: -1

The day started out well enough, even despite Treasury Secretary Geithner's tough talk yesterday. Asia was up in fact, benefiting perhaps from a Morgan Stanley call on the Japanese Yen. The game changer this morning though, turning stocks sour after a week lifted by Tea Party victories, was the Consumer Sentiment reading and a scare in Ireland. The consumer mood soured to its lowest mark since August 2009. That rendered an uplifting CPI report mute this morning, and threatens negative territory for stocks today. The "Greek Factor" ranges from +3 to -3, and is a subjective measure of The Greek's view of the market impact of individual and aggregate news and the day's scheduled events.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

(Tickers: Nasdaq: ORCL, Nasdaq: RIMM, Nasdaq: CERN, Nasdaq: SATC, Nasdaq: ULBI, NYSE: AGP, Nasdaq: DDMX, Nasdaq: PRIMU, Nasdaq: CRXL, NYSE: STU, Nasdaq: LIVED, Nasdaq: CBLI, Nasdaq: MGYR, Nasdaq: SPNS, Nasdaq: DSTI, Nasdaq: BFSB, Nasdaq: REFR, Nasdaq: VITA, NYSE: CO, Nasdaq: PATK, NYSE: FMD, Nasdaq: FBIZ, Nasdaq: TPCG, Nasdaq: HHGP, Nasdaq: ULBI, Nasdaq: RUTH, AMEX: XFN, Nasdaq: OINK, Nasdaq: TZOO, NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ)

Consumer Sentiment Marks Apocalyptic 66.6

We suspect the market is liking the wins of Tea Party Republicans (this is what they should be called, since it is not a new party), and has moved on recent election results this week more than anything else. The Dow jumped Tuesday and has displayed a clear upward bias ever since. However, all that changed this morning with a scare about the sovereign debt of Ireland and a dire consumer sentiment reading.

Consumer Price Index (CPI)
Greek Factor: +1

Following yesterday's favorable PPI report, the Bureau of Labor Statistics reported on the Consumer Price Index for August today. While yesterday's data covered producers, this measure is closer to the hearts of economists and policy makers with their ear attuned to the rail of deflation and inflation.

The Consumer Price Index (CPI), like its PPI peer, keys on two bottom line data points. The Headline CPI metric aggregates consumer prices with disregard for the significant swings in prices for food and energy, whereas the Core CPI weeds out those two factors, to provide the public with a more applicable inflation gauge.

The Headline Consumer Price Index increased 0.3% in August, which was in line with economists' forecasts. This latest result compares against a seasonally adjusted increase of 0.3% in July as well. Removing seasonal adjustments shows a 0.1% increase in the CPI last month.

Like in July, the energy component of the index played a key role in driving the substantial price rise. The overall energy component rose 2.3%, so that the removal of energy and food prices led to an unchanged Core Consumer Price Index in August. This matched against a 0.1% increase in July and also against economists' forecasts for the same gain this latest month. Generally, we would view this as clearly good news, but with fears now centered on deflation, that's not so definite. That said, we think the market is far from buying into a deflation scenario, and view the CPI data as a positive driver this morning.

Consumer Sentiment
Greek Factor: -2

The University of Michigan produced its Consumer Sentiment Index in conjunction with Reuters this morning. Consumer Sentiment weakened unexpectedly in this early September reading, with the Index falling to an ominous mark of 66.6, down from 68.9 in August. Economists were looking for a reading of 70.0. The current reading is the lowest since August of 2009, and perhaps reflects consumers' frustration with their financial situation and the economy while purchasing back-to-school goods, in this analysts' view. It's also likely that the upcoming elections and this month's primaries intensified consumer emotions and drove exaggerated responses by consumers.

Overseas Activity
Greek Factor: -1

Germany reported its Producer Price Index this morning. The measure showed a 3.18% increase for August, versus the 3.66% gain seen in July. The DAX is down fractionally this morning, and so the data was digestible, especially considering renewed worries around Ireland today. Europe was mostly mixed today and relatively unchanged. Asia reacted to the US Treasury Secretary's report to Congress (re China trade) without even a whimper. The NIKKEI 225 jumped 1.2% and the Hang Seng 1.3%. We suspect this will all change once the Chinese government has issued its likely harsh response. Thus, beware the potential Chinese catalyst in coming days. Asia may also be moving on a Morgan Stanley (NYSE: MS) analysts' call for the Japanese Yen to weaken by year's end, thanks to Japanese government intervention. However, the most important impact to US trade this morning is rising concern about a sovereign debt crisis brewing in Ireland.

Consumer Advocate Appointment
Greek Factor: -1

President Obama appointed Elizabeth Warren to the position of special advisor and overseer of a new consumer protection bureau. This should be seen as a positive by Wall Street, but considering the aversion to regulation amid the money-movers, that's not the case. Warren has been painted as anti-Wall Street, which makes her a popular pick just about everywhere else.

Gee, do you think I should have named my blog Main Street Turk, considering what's happened to Wall Street and Greece since. Our moniker is tied to two of the most detested topics in our contemporary society today (stretching globally mind you), Wall Street crooks and irresponsible financial management in Greece. Nice branding job Markos! Why thank you Markos.

The SEC considers disclosure rules today for public companies' short-term borrowings.

Corporate News Drivers
Greek Factor: +1

Oracle (Nasdaq: ORCL) reported earnings that beat Street views last night and the shares are up plus 6% in the early going this morning. Research in Motion (Nasdaq: RIMM) is also benefiting from its report, up plus 2% this day. Cerner (Nasdaq: CERN) is presenting at the Stifel Nicolaus Health Care Conference. The Ardour Capital Investments, LLC Energy Technology Conference highlights presentations by Satcon Technology (Nasdaq: SATC) and Ultralife (Nasdaq: ULBI). Amerigroup (NYSE: AGP) has its analysts meeting scheduled for today, and Dynamex (Nasdaq: DDMX) has its earnings conference call.

The day's early winners (prices may have changed since) include Primoris Services (Nasdaq: PRIMU) +76%, Crucell (Nasdaq: CRXL) +55%, Student Loan Corp. (NYSE: STU) +41%, LiveDeal (Nasdaq: LIVED) +26%, Cleveland Biolabs (Nasdaq: CBLI) +15%, Magyar Bancorp (Nasdaq: MGYR), Sapiens International (Nasdaq: SPNS) +18%, DayStar Tech (Nasdaq: DSTI) +11%, Brooklyn Federal Bancorp (Nasdaq: BFSB), Research Frontiers (Nasdaq: REFR) +9%, Orthovita (Nasdaq: VITA) +5%, China Cord Blood (NYSE: CO) +7%, Patrick Industries (Nasdaq: PATK) +8%, First Marblehead (NYSE: FMD) +10%, First Business Financial (Nasdaq: FBIZ) +14%, TPC Group (Nasdaq: TPCG) +8%, Hudson Highland Group (Nasdaq: HHGP) +5%, Ultralife (Nasdaq: ULBI) +5%, Ruth’s Hospitality Group (Nasdaq: RUTH), Xfone (AMEX: XFN) +6%, Tianli Agritech (Nasdaq: OINK) +7%, Travelzoo (Nasdaq: TZOO) +6%.



Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Consumer Confidence Symptomatic of Economic Muddle

The latest bout of lost consumer confidence is simply symptomatic of economic muddle and political stalemate. Long-term unemployment, threats to employment benefits and other stimuli souring have injured the mind and mood of America's most important segment, and threaten to lead the economy into double-dip recession.

"The Greek" earned clients a 23% average annual return over five years as a stock analyst on Wall Street. While writing for Wall Street Greek and others, he presciently predicted the financial crisis and housing and banking failures of the Great Recession. Visit the front pages of Wall Street Greek now to see our current coverage of business news, the global economy & financial markets, real estate, shipping, fine art & antiquities and global affairs.

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Consumer Confidence is Symptomatic of Economic Muddle

The Conference Board published its Consumer Confidence Index for the month of July this week. The Board's latest measurement of the consumer mood showed even further deterioration in July sentiment, to a level of 50.4, from June's revised mark of 54.3 (from 52.9). The Conference Board's late June report produced a near 10 point decline in the index from a May mark of 62.7. That type of a dramatic drop in the index usually coincides with a shock to the market and economy, but not this time. Take note, because this is extremely troubling.

Given that the index saw no rebound off a drastic drop, investors received an important signal Tuesday. Consumers drive the American economy, which has evolved to become services oriented and consumption based. The warning siren on the consumer mood has been wearing out our ears here at Wall Street Greek for some time now, and the batteries must be running low on that horn by now. We first noticed red flags on this metric when the Board's Expectations Index showed its initial cracks. However, we were looking toward those cracks when investors were sure the economic foundation was sound and strengthening; many on the street were instead intoxicated by profit calculations on rising stocks.

We reiterate: President Obama must key on the employment situation and seek to spur business and job growth to lead the USA out of economic trough and anchored unemployment. His plans for an alternative energy manufacturing base must move forward, as this stratagem offers a path to a new industrial revolution. This potential revolution can bring jobs back to the US, and make the country a viable exporter and supplier to a new and important global marketplace.

Consumer Confidence Report Details

Consumers are sour on both the current reality of the economy and future prospects. The Present Situation Index slipped further in July, to a level of 26.1, from 26.8 in June. It looks as if consumers see the current situation as about as bad as can be, and for good reason. Consumer opinions about the state of employment have softened as job seekers lose hope. Consumers claiming that jobs are hard to get increased in July, to 45.8% of those surveyed, from 43.5% in June. Those saying that general conditions are bad also increased to 43.6%, from 41.0% in June.

"The outlook is hopeless, as per the opinion of the most important segment of Americans."

The outlook is hopeless, as per the opinion of the most important segment of Americans. The Expectations Index dropped to 66.6 in July, from 72.7 last month. The percentage of consumers that see an improvement coming over the next six months fell as well, to 15.9%, from 17.1% last month. Those who see things getting worse increased in number, rising to 15.7% of those surveyed, from 13.9% in June. Again the key to concern remains the job situation, with almost 10% of the labor force still unemployed and near 17% working less hours than satisfactory. And the average workweek is decreasing, based on the latest data. Soon, manufacturers may need to again cut workforce, as shifts bleed away. The Conference Board asked consumers about their outlook for the job market, and the unfortunate news is that those who see job opportunities increasing over the next six months fell in number to 14.3%, from 16.2% in June. Those anticipating fewer jobs increased a full percentage point, to 21.1%.

Retail Trouble Ahead

The back to school shopping season is an important catalyst for the retail sector, and a somewhat reliable driver of sales traffic. However, given the high and increasing number of long-term unemployed, spending is under threat to decrease this season. It's sad that the best argument against that statement is that last year's sales were pretty darn bad. That means retailers may have to dig deeper into margins to inspire shoppers to buy goods at their location versus the one down the street. And now that unemployment benefit extensions seem like a less reliable source of income for many Americans who are surviving on them, consumers are very likely to tighten their wallets again this year.

The latest Weekly Same-Store Sales data reported by the International Council of Shopping Centers (ICSC) this morning, is still showing growth. Sales rose 0.6% on a week-over-week basis for the period ending July 24. When compared to last year's soft activity, sales stood 3.8% higher. We have often noted here that as last year's comparables get harder to beat, we'll see this comparison soften dramatically. We're still matching against some of the weakest absolute sales numbers (per person) seen in modern US history.

This means that competition will tighten further for the big box department stores like Macy's (NYSE: M), J.C. Penney (NYSE: JCP), Kohl's (NYSE: KSS) and others, and cost management will remain in focus. Specialists like Aeropostale (NYSE: ARO), Chicos (NYSE: CHS), Ann Taylor (NYSE: ANN), The Gap (NYSE: GPS), Wet Seal (Nasdaq: WTSLA), Hott Topic (Nasdaq: HOTT), The Limited (NYSE: LTD), Children's Place (Nasdaq: PLCE) and others will need to excel in buying and fashion sense to differentiate their wears. And the discounters will continue to steal market share, so good news for Wal-Mart (NYSE: WMT), Target (NYSE: TGT), Costco (Nasdaq: COST), Family Dollar (NYSE: FDO), Dollar Tree (Nasdaq: DLTR), Dollar General (NYSE: DG) and Sears' (Nasdaq: SHLD) K-Mart stores.

Conclusion

In summary, seeing Consumer Confidence wane further in July, after a precipitous drop in June, should be of highest concern to the Administration, Congress, investors and all Americans. Our national economic driver, consumer spending - or rather the consumer, is losing confidence in economic recovery and in government supports. We must continue to prioritize stimulus over budgetary controls, as this economic trough will be impossible to climb out of otherwise. The budget is a long-term issue that is worthy of concern, but we cannot let political purposes now clutter sound decision making. We need to restore business and job growth to renew consumer spending. We can address the budget in due time, or now (somewhat), but in a manner that does not threaten economic recovery nor confidence.



Tuesday's earnings included news from Cephalon (Nasdaq: CEPH), C.H. Robinson Worldwide (Nasdaq: CHRW), AmerisourceBergen (NYSE: ABC), Office Depot (NYSE: ODP), International Game Technology (NYSE: IGT), Norfolk Southern (NYSE: NFK), AM Castle (NYSE: CAS), Acadia Realty Trust (NYSE: AKR), ACE Limited (NYSE: ACE), Active Power (Nasdaq: ACPW), Aetna (NYSE: AET), Affiliated Managers Group (NYSE: AMG), Aflac (NYSE: AFL), Agco (Nasdaq: AGCO), AK Steel (NYSE: AKS), American Campus Communities (NYSE: ACC), Ametek (NYSE: AME), Anixter Int'l (NYSE: AXE), Arthur J. Gallagher (NYSE: AJG), Asbury Automotive Group (NYSE: ABG), ATC Technology (Nasdaq: ATAC), B&G Foods (NYSE: BGS), Barrett Business Services (Nasdaq: BBSI), Basic Energy Services (NYSE: BAS), BE Aerospace (Nasdaq: BEAV), Bemis (NYSE: BMS), Blackbaud (Nasdaq: BLKB), Boston Properties (NYSE: BXP), BP (NYSE: BP), Broadcom (Nasdaq: BRCM), Canon (NYSE: CAJ), Capella Education (Nasdaq: CPLA), Capital Trust (NYSE: CT), Capitol Federal Fin'l (Nasdaq: CFFN), Carlisle Cos. (NYSE: CSL), Cathay General Bancorp (Nasdaq: CATY), CB Richard Ellis (NYSE: CBG), CBiz (NYSE: CBZ), Centene (NYSE: CNC), Century Aluminum (Nasdaq: CENX), Ceradyne (Nasdaq: CRDN), CGI Group (NYSE: GIB), Charm Communications (Nasdaq: CHRM), Chelsea Therapeutics (Nasdaq: CHTP), Chicago Bridge & Iron (NYSE: CBI), Choice Hotels International (NYSE: CHH), CIT Group (NYSE: CIT), Cobalt Int'l Energy (NYSE: CIE), Companhia Brasileira de Distribuicao (NYSE: CBD), Compass Minerals (NYSE: CMP), Compugen (Nasdaq: CGEN), Computer Task Group (Nasdaq: CTGX), Corn Products Int'l (NYSE: CPO), CSG Systems (Nasdaq: CSGS), Cummins (NYSE: CMI), Cynosure (Nasdaq: CYNO), Delphi Fin'l (NYSE: DFG), Deltic Timber (NYSE: DEL), Deutsche Bank (NYSE: DB), DiamondRock Hospitality (NYSE: DRH), Dice Holdings (NYSE: DHX), Dominos Pizza (NYSE: DPZ), Dorman Products (Nasdaq: DORM), Dreamworks Animation (NYSE: DWA), DST Systems (NYSE: DST), DuPont (NYSE: DD), Dynex Capital (NYSE: DX), EarthLink (Nasdaq: ELNK), East West Bancorp (Nasdaq: EWBC), EastGroup Properties (NYSE: EGP), Ecolab (NYSE: ECL), Edac Technologies (Nasdaq: EDAC), eHealth (Nasdaq: EHTH), Empressa Nacional de Electricidad SA - Endessa Chile (NYSE: EOC), Endurance Specialty (NYSE: ENH), Endwave (Nasdaq: ENWV), Energizer (NYSE: ENR), Enersis SA (NYSE: ENI), Entegris (Nasdaq: ENTG), Entercom (NYSE: ETM), EPIQ Systems (Nasdaq: EPIQ), Ferro (NYSE: FOE), First Community Bancshares (Nasdaq: FCBC), FirstMerit (Nasdaq: FMER), Fiserv (Nasdaq: FISV), Flagstar Bancorp (NYSE: FBC), FormFactor (Nasdaq: FORM), Global Payments (NYSE: GPN), Group 1 Automotive (NYSE: GPI), Grupo Radio Centro (NYSE: RC), GTC Biotherapeutics (Nasdaq: GTCB), Hanger Orthopedic (NYSE: HGR), Hanmi Fin'l (Nasdaq: HAFC), Hawaiian Holdings (Nasdaq: HA), Heidrick & Struggles (Nasdaq: HSII), Hutchinson Tech (Nasdaq: HTCH), ICON (Nasdaq: ICLR), Iconix Brand (Nasdaq: ICON), Illumina (Nasdaq: ILMN), Imation (NYSE: IMN), Imergent (AMEX: IIG), Innodata Isogen (Nasdaq: INOD), IntegraMed America (Nasdaq: INMD), Integrated Silicon Solution (Nasdaq: ISSI), InterMune (Nasdaq: ITMN), Intricon (Nasdaq: IIN), Inventure Foods (Nasdaq: SNAK), Invesco (NYSE: IVZ), IRIS Int'l (Nasdaq: IRIS), Jacob's Engineering (NYSE: JEC), JDA Software (Nasdaq: JDAS), Kansas City Southern (NYSE: KSU), Keynote Systems (Nasdaq: KEYN), Kimco Realty (NYSE: KIM), Kinetic Concepts (NYSE: KCI), Kona Grill (Nasdaq: KONA), LB Foster (Nasdaq: FSTR), L-3 Communications (NYSE: LLL), LAN Airlines (NYSE: LFL), Lawson Products (Nasdaq: LAWS), LCA-Vision (Nasdaq: LCAV), Lennox Int'l (NYSE: LII), Level 3 Communications (Nasdaq: LVLT), Lexmark (NYSE: LXK), Lincoln Electric (Nasdaq: LECO), Lockheed Martin (NYSE: LMT), Manitowoc (NYSE: MTW), Massey Energy (NYSE: MEE), MBT Financial (Nasdaq: MBTF), Meritage Homes (NYSE: MTH), Nabors Industries (NYSE: NBR), Nalco Holding (NYSE: NLC), National Instruments (Nasdaq: NATI), New Alliance Bancshares (NYSE: NAL), Numerex (Nasdaq: NMRX), NuVasive (Nasdaq: NUVA), Occidental Petroleum (NYSE: OXY), optionsXpress (Nasdaq: OXPS), PAM Transportation (Nasdaq: PTSI), PACCAR (Nasdaq: PCAR), Pacific Capital (Nasdaq: PCBC), Panera Bread (Nasdaq: PNRA), PAR Tech (NYSE: PTC), Parametric Technology (Nasdaq: PMTC), Patriot Coal (NYSE: PCX), Penn Virginia (NYSE: PVG), Penn Virginia Resources (NYSE: PVR), Pervasive Software (Nasdaq: PVSW), Pharmaceutical Product Development (Nasdaq: PPDI), Pixelworks (Nasdaq: PXLW), PrivateBancorp (Nasdaq: PVTB), QLT Inc. (Nasdaq: QLTI), Questar (NYSE: STR), RadiSys (Nasdaq: RSYS), Radware (Nasdaq: RDWR), Ramco-Gershenson Properties Trust (NYSE: RPT), Ramtron (Nasdaq: RMTR), ReachLocal (Nasdaq: RLOC), Regions Fin'l (NYSE: RF), Renaissance Re (NYSE: RNR), RF Micro Devices (Nasdaq: RFMD), Rimage (Nasdaq: RIMG), Rockwood Holdings (NYSE: ROC), Rocky Brands (Nasdaq: RCKY), Rogers Communications (NYSE: RCI), SAP AG (NYSE: SAP), SeaBright (NYSE: SBX), Seattle Genetics (Nasdaq: SGEN), Signature Bank of NY (Nasdaq: SBNY), Silicon Image (Nasdaq: SIMG), Stepan (NYSE: SCL), Sterling Fin'l (Nasdaq: STSA), Sun Communities (NYSE: SUI), Sunoco Logistics (NYSE: SXL), SuperMedia (Nasdaq: SPMD), Supertex (Nasdaq: SUPX), Supervalu (NYSE: SVU), Tanger Factory Outlet (NYSE: SKT), Taser (Nasdaq: TASR), Taubman Centers (NYSE: TCO), Teck Resources (NYSE: TCK), Tellabs (Nasdaq: TLAB), Temple-Inland (NYSE: TIN), Tennessee Commerce (Nasdaq: TNCC), Teva Pharmaceutical (Nasdaq: TEVA), Nasdaq OMX (Nasdaq: NDAQ), Thermo Fisher Scientific (NYSE: TMO), Trimble Navigation (Nasdaq: TRMB), Trustmark (Nasdaq: TRMK), US Lime & Minerals (Nasdaq: USLM), UBS (NYSE: UBS), Ultimate Software (Nasdaq: ULTI), Umpqua Holdings (Nasdaq: UMPQ), UnderArmour (NYSE: UA), Unisys (NYSE: UIS), United States Steel (NYSE: X), Unitil (NYSE: UTL), US Ecology (Nasdaq: ECOL), USANA Health (Nasdaq: USNA), Valero (NYSE: VLO), VASCO Data Security (Nasdaq: VDSI), VisionChina Media (Nasdaq: VISN), Vocus (Nasdaq: VOCS), Washington Banking (Nasdaq: WBCO), Websense (Nasdaq: WBSN), Western Union (NYSE: WU), Whitney Holding (Nasdaq: WTNY), Wilshire Bancorp (Nasdaq: WIBC), World Acceptance (Nasdaq: WRLD), Wright Express (NYSE: WXS) and Zix Corp. (Nasdaq: ZIXI).

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