By Patrick Watson
Thursday the Commerce Department reported an unexpected decline in retail sales for July. Remarkably, it appears that people who do not have jobs spend less money, and retailers lose sales as the number of such people grows. Why this surprises anyone is unclear.
For those who do have money, one of the more popular places to spend it is Wal-Mart (NYSE:WMT), which confounded Wall Street once again with unexpected profits. (By the way, I am sorry to use the word “unexpected” so much. The fact that I must do so should tell you something about the ability of the analysts who set these expectations.)
“The chain also attracted more customers, helped by price reductions on its Sam’s Choice Black Angus beef patties, baked beans and flat- panel televisions to lure consumers grappling with shrinking paychecks and the worst unemployment since the Great Depression.”
There’s the real story in eight short words: beef patties, baked beans and flat-panel televisions. This is what we’re all buying now, apparently. Americans are nothing if not practical. Football season is approaching quickly and Wal-Mart is mercifully giving us a chance to prepare at a bargain price.
The reality is that we can’t postpone reality forever, yet many of us are still trying.
Disclosure: No position