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7/14/10 Midafternoon Report: Retail stales

|Includes:Computer Task Group Inc. (CTG), INTC, MSFT, VMW

Ho fucking hum.  Retail sales fell again in June as stores keep trying to charge money for products and people keep not having any.  Sales dropped .5% in June, though if you exclude automobiles, sales only dropped .1%, and if you go one step further and exclude anything bought in a store other than ramen noodles and despair, sales would have doubled.  It wasn't just auto sales that drove the numbers down though as furniture, building-materials, sporting goods, groceries, and especially Mel Gibson's career, saw weakness.  This is in contrast to the ICSC's report last week where they broke out their crayolas and limited knowledge of cropping photos or using excel to put out an eyesore-ingly bad table showing that chain store sales were up 3% for the month.  To Money McBags, that means people are skimping on more discretionary items and shifting their spend to staples and to stores with lower overheads that can offer deep discounts, of course, all of the data is made up anyway like leprechauns, unicorns, and Larry Craig's wife, so who really fucking knows.

That said, with the consumer remaining hesitant to spend on anything but lottery tickets and something called jeggings (which Money McBags thinks are a mixture of jeans, leggings, and awesomeness), the stimulus having worked most of its way through the system, and extended unemployment benefits on the same life support as George Steinbrenner, there is little about which to be excited (unless you live next door to Sofia Vergara, and if you do, Money McBags would be happy to quickly come over).

In other macro news, mortgage applications sunk to a 13 year low despite record low mortgage rates, declining house prices, and buy one get free specials at foreclosure auctions.  Loan requests dropped by 3% with the federal tax break now over and frictional unemployment becoming less voluntary and more permanent thus causing the supply of people moving for work to shrink more than the attendance will for Yale's women's basketball games once Yoyo Greenfield graduates.  Finally, the minutes from the last Fed meeting were released today with the Fed lowering their growth forecast for the first time in a year citing lackluster job growth and the creeping in of common sense.  The continued struggles of the economy have them contemplating ways to stimulate the market again if data continues to worsen such as buying more assets, keeping rates low until the next bubble, or having Sara Jean Underwood man the Fed's discount window.

Internationally, word is leaking out that 11 banks may fail the european bank stress test including Germany's Commerzbank, Italy's Banco Popolare, and France's Banque de la Pret Merde.  But Macquarie Securities director Alessandro Roccati tells us not to despair because "only 11" of the 46 banks will likely fail and...READ MORE....ANALYSIS OF CTGX....

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Stocks: CTG, MSFT, INTC, VMW