30 July 2020

1) First Walmart then Target and Dick’s Sporting Goods and now Best Buy have announced they will be closed on Thanksgiving, with more retailers expected to follow suit. The decision is in response to the coronavirus pandemic. Traditionally, Thanksgiving Day is the kick off of Black Friday sales, where retailers offer their lowest sales prices as the kickoff of the Christmas shopping season. But this also draws large crowds, something that goes against public health guidelines for social distancing. Instead, retailers will be offering their big sales online.

2) The spending habits of millennials had been credited with the decline of traditional consumer products, but now seem to be reversing for comebacks. Things like golf, starter homes and canned tuna are now on the rise, in part because of the covid-19 crisis. Some other products now on the rise is beer, mayo and cereal to name a few. More indications of how economic times in America are ever changing and becoming more unpredictable.

3) The pandemic crisis has sent the U.S. Postal Service into a fiscal tailspin, with President Trump saying he would not support a financial bailout until the Postoffice reformed its pricing of package deliveries for large on-line retailers like Amazon. But the federal government is preparing a $10 billion dollar loan to the Postoffice to continue services. This loan is part of the proposed $2 trillion dollar pandemic relief package passed in March, but the President said he wont spend the money until the USPS agrees to raise its prices. Much of the online retail business is dependent on the USPS to deliver their goods via mail delivery.

4) Stock market closings for – 29 JUL20:

Dow 26,539.57 up 160.29
Nasdaq 10,542.94 up 140.85
S&P 500 3,258.44 up 40.00

10 Year Yield: down at 0.58%

Oil: up at $41.32

8 May 2020

1) The shutdown orders are being lifted in many states, which also includes the shopping malls, but those malls remain eerily quite, almost void of humans, where once mobs crowded and surged in the hallways. People are electing to do a minimum of shopping or to shop online instead. The change is in part from fears of the virus and in part because of the high unemployment and fears of the economy floundering. There are questions of how much the American shopping ethos will return, or if consumerism is experiencing a fundamental change. The big department stores and big box stores were already suffering from changes in shopping habits and the virus may have accelerated that trend, plus many malls across America had already closed up before the pandemic. With consumerism accounting for half the economy, the future of shopping is a serious question.

2) A second major retailer has filed for bankruptcy during the coronavirus crisis. The 113 year old chain Neiman Marcus Group, which has been struggling with a $5 billion dollar debt much of it from leveraged buyouts in 2005 and 2013. With having to close 43 of its stores and laying off most of its 14,000 worker, the pandemic forced reduction of revenues that made the debt unsustainable. And that’s what broke their financial back. More than 263,000 stores in America have had to closeup leaving them with little to no revenues while their monthly fix cost remained unchanged, so questions abound of how many others will follow in the next few months, particularly if jobs don’t quickly return. On the positive note, restaurants doing takeout service, like Papa John’s Pizza, have done quite well.

3) The number of jobless Americans reached 33 million with the addition of another 3.2 million filings for unemployment benefits. This is over a seven week period, while previously 200,000 a week had once been the norm. There just doesn’t seem to be any letup in unemployment in sight from the virus crisis, with deepening fears a recession could be a long affair. On a positive note, this is the fifth week where the jobless claims have fallen, but still there are worries that the total number may go over 40 million before returning back to normal.

4) Stock market closings for – 7 MAY 20:

Dow 23,875.89 up 211.25
Nasdaq 8,979.66 up 125.27
S&P 500 2,881.19 up 32.77

10 Year Yield: down at 0.63%

Oil: down at $23.81

21 April 2020

1) The second wave of unemployment is coming after an unprecedented spike in layoffs from the cornonavirus ‘stay at home’ orders. But while businesses will soon start rehiring workers, many will take the opportunity to replace their workers with cheaper and more contingent labor. The crisis will accelerate trends towards industry consolidation that reduces potential employers, automation, which replaces human labor, and worker precarity when convenience of employers and customers entirely overrides the well being of workers. Further aggravating employment will be the large number of small businesses expected to succumb to the recession leaving fewer employment opportunities. Also, the force isolation is changing people’s buying habits with more online shopping, delivery services and self service kiosks. These methods of automation also represent cost cutting methods, which companies will cultivate to make more wide spread. All this promises to make the second round even harsher.

2) Oil prices continue their downward spiral, with futures at record lows as investors worry about lack of storage and the world economy. German and Japanese data indicates a bleak global economy, which will in turn pull America’s down. Despite measures being taken to reduce the supply, the glut will continue for the foreseeable future. Numerous statistics and prices point to a continual crisis for the world and American economies.

3) Restaurants are particularly hard hit by the coronavirus economy, with more than 8 million workers having lost their jobs, about two-thirds of the restaurant labor force. About four in ten restaurants have closed, while many others struggle to stay afloat by providing curbside service. The National Restaurant Association is asking for more monies to support survival of restaurants during this period of government enforced business closure. Like so many other small businesses, the future for many restaurants is looking very doubtful.

4) Stock market closings for – 20 APR 20: Oil drops from $18.12 for Friday to -$16.10, almost a complete inversion in price.

Dow 23,650.44 down 592.05
Nasdaq 8,560.73 down 89.41
S&P 500 2,823.16 down 51.40

10 Year Yield: down at 0.63%

Oil: down at -$16.10

24 December 2019

1) The poor showings of two major movies this last weekend shows the risk Hollywood faces with new movie productions. The final installment of Star Wars, The Rise of Skywalker and Cats both have fallen short of predicted first week ticket sales, highlighting the risk associated with cinema productions. The theatrical market is dominated by a few blockbuster movies at the expense of almost everything else, leaving theater owners struggling for productions to draw needed customers.

2) Holiday shopping set records over the weekend with Super Saturday sales reaching $34.4 billion dollars making it the biggest single day in U.S. retail history. Super Saturday topped Black Friday’s $31.2 billion dollars by 10%. This is despite foot traffic in the malls being down, indicating people are spending more. Next question is – will this stellar momentum lead to sustained economic growth in 2020.

3) The internet music downloading site Spotify is expanding into the podcasts market. The company is spending big to lock down exclusive shows and introduce several new features for users. Already a success now making a profit with music, Spotify is determined to be a power player in the world of podcasts, considering podcast to be a great complementary product. Spotify has announced it has acquired Gimlet Media and Anchor production companies to strengthen its podcast abilities.

4) Stock market closings for – 23 DEC 19:

Dow                28,551.53    up    96.44
Nasdaq             8,945.65    up    20.69
S&P 500            3,224.01    up       2.79

10 Year Yield:    up   at    1.94%

Oil:     up   at    $60.58

BLACK FRIDAY SALES WAS A HIT, BRICK & MORTAR STILL TOOK A HIT!!!!!!!!!!!!!!!

By: Economic & Finance Report

The analytics are in, Black Friday 2019 did its numbers. Black Friday did over $20 billion in revenue, over $7 billion in online and digital sales alone, from latest info projected (Forbes.com). (1)

The revenue numbers surpassed last year (2018), from Black Friday sales. This was anticipated of course, but maybe not by the figures that came in of $20 billion.

Though with strong numbers, brick and mortars shops and stores will still be closing unfortunately, to focus more of their retail sales online because of what many speculate as being the “Amazon Effect”. The “Amazon Effect” has forced brick and mortar stores and outlets to realign their focus toward online sales and marketing. A game changer to indicate the least. -SB

(1) Content: https://www.forbes.com › sites › johnkoetsier › 2019/11/30 › record-black-f… (Forbes)

SEARS SEEMS TO BE GOING THRU BANKRUPTCY………

By: Economic & Finance Report

Sears looks as if it will be staring down the eyes of bankruptcy. They have hired M-III Partners to assist in the bankruptcy filings; that is expected to be filed later this week. The end of the second week of October.

Sears has been losing money with their brick and mortar businesses in recent years, especially as e-commerce businesses such as Amazon have been profiting from online sales for a long time.

As E-commerce ramps up sales as the holiday season approaches, Sears has needed to reevaluate their business models, while at the same time waving the white flag. -SB

CVS BUYING HEALTHCARE GIANT AETNA…

By: Economic & Finance Report

Pharmacy giant CVS is buying the third biggest healthcare company, Aetna for a reported $69 billion dollar deal, which includes cash and stock options.

This deal is coming to fruition just in time as the Senate and US House Reps each passed their version of the tax reform bill, now the two versions will go into conference with negotiators from both chambers. The end bill looks like it will be touching President Trump’s desk before Christmas, for his signature into law.

Both CVS and Aetna are power houses in their respective industries and business sectors. CVS beong one of the biggest retail and pharmaceutical chains in the US and Aetna being in the top 3, in the healthcare industry. Both companies have indicated that the merger makes sense because the consumer(s) will be the ultimate winners from the deal because they will be paying a lot less and saving alot more for medical prescription drugs in the US. -SB

AMAZON HAS JUST PURCHASED BIGGEST ONLINE MIDDLE EAST RETAILER!!!!!!!!! SOUQ.COM!!!!!!!

By: Economic & Finance Report

AMAZON (AMZN) has done it again folks!!!!!! One of the world’s largest online retailers has just bought the biggest Middle East online e-commerce retailer.  Amazon has recently acquired Souq.com; the biggest ecommerce retailer in the Middle East. The company which is based in Dubai, United Emirates is the largest of its kind, in the middle east. Souq is valued at over $1 billion dollars .

Amazon has been serving customers in the Middle East for years, but wanted to expand its portfolio in the region, and they have with the purchase of Souq. It has been noted that Souq.com sells more than  eight million products in the region.

Souq.com has over 3,000 employees in the Middle East and Arab countries; when the company started in Dubai, they only had five employees. Souq CEO Ronaldo Mouchawar, believed Amazon was the only choice as far as his concern, though the company had a $800 million counter offer buyout on the table; Mouchawar and his team believed Amazon was a very suitable home for Souq’s long term vision. -SB