Brick And 'Martyr:' Trading The Retail Apocalypse

The Heisenberg profile picture
The Heisenberg


  • Here's a sector that's on life support.
  • And here's how you can trade it before someone pulls the plug.
  • Now let's see what readers are more prone to criticize: the trade idea(s) or the thesis itself.

This should be fun.

I'm going to try an experiment which will invariably go horribly awry and lead to all kinds of commenter shenanigans.

If you own brick and mortar retailers, you should get out. Run for the hills. Sell it all.

Why? Simple: The model is dead. Or, if it's not dead, it's on life support. And the proverbial plug will be pulled in relatively short order.

I remember years and years ago, people used to go to Target for fun. Literally.

It even used to have a cute nickname amongst the "in-crowd" of popular high school seniors and female college freshman outfitting their dorm rooms. They called it: "Tar-jay" or "Tar-zhay."

When was the last time you heard anyone say: "Hey, you wanna go to Target and just wander around?" For me it's been about a decade.

But moving beyond the anecdotal, recall the common sense assessment I outlined earlier this month in a post that introduced the "cheezburger cat" as the latest addition to the Heisenberg cast of characters:

Anyone who's been paying attention over the past six or so months is also acutely aware that there's another sector of the US economy imploding: retail (NYSEARCA:XRT). Retail's troubles are well documented. The rise of online competition and a steady decline in foot traffic and earnings seem to presage a veritable apocalypse for brick and mortar. And gain, that's not hyperbole. This is an existential crisis. Just ask any analyst that covers the space.

And while this is one of those cases where some of the "losers" (brick and mortar) will be replaced by "winners" (e-commerce), this is still a major concern.

It really is that simple for brick and mortar or, as I like to call it in a nod to its impending demise, "brick and martyr."

This article was written by

The Heisenberg profile picture
Perhaps more than any other time in the last six decades, the fate of markets is inextricably intertwined with the ebb and flow of geopolitics. It's become increasingly clear that one simply cannot fully comprehend market movements without a thorough understanding of concurrent political outcomes. Drawing on extensive experience in both politics and finance, Heisenberg will help demystify a world in which investors can no longer hope to conceptualize of markets as existing in anything that even approximates a vacuum.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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