Fortune Magazine, the journal of the Masters of the Universe, posted the following headline at 11:33 yesterday morning: “U.S. shoppers finally shed funk: Retailers post strong holiday season gains.” At the same time the experts at NASDAQ.com. writing for the same audience of one-percenters, headlined: “Retail Sales Drop .9% as Consumers Pull Back.” Wait, what? Did we Americans shed our funk, as Fortune insisted (“retail sales for November and December rose 4%…the industry’s best showing in three years.”) or pull back, as NASDAQ saw it (“Sales at retailers and restaurants decreased a seasonally adjusted 0.9% in December from a month earlier…the largest monthly decline since January 2014.”)
So to summarize: It was the best of times, it was the worst of times…
Whether you see a contented nation happily filling its Christmas stockings and celebrating the return of prosperity, or millions of frightened people desperately trying to maintain their faltering grip on a decent way of life, depends on which numbers you choose to see, and how you choose to see them. The National Retail Federation, the source for Fortune’s song of praise, insisted on adding November and December sales together, which gave them a rollicking four percent increase year to year and a reason to declare morning in America.
If Fortune and the National Retail Federation hoped that their well-spun tale would become the narrative of the day, heartening America and spurring the stock market to new heights, they were disappointed. By 4 pm when the gamblers pushed back from their trading keyboards, nauseous from another daylong roller-coaster ride on a market that is losing its mind, the retail sales numbers were universally seen as a disaster that tanked the market.
And so it’s back to living the dream: gas will stay cheap. oil will come back, and the Dow will stay high forever. Or maybe it’s time to wake up and smell the smoke.
- KB Homes, one of the largest homebuilders in the country helped the stock market go into its Tuesday swoon when it announced its expectations for next year: falling home prices, rising building costs, softening demand and shrinking profits. The Dow fell 400 points, taking most homebuilder stocks with it, before catching the next updraft.
- Dreamers like to dream about the auto industry, which has led the economy upward, to the extent there has been an “up,” for some time. In 2014 auto sales increased by $86 billion dollars, a definite uptick for an otherwise moribund country. Problem is, in the same time period, the amount of auto loans outstanding grew by $89 billion. I guess that’s about $3 billion in “cash-back” gratuities.
- Signs and portents of an imminent stock-market crash continue to proliferate. It is well known that extreme market volatility — movements of the Dow Jones average of more than 100 points a day — always precede a crash, and the VIX, or volatility index, is up 20% so far in 2015; the Dow has moved more than a hundred points every day this year. CNN’s Fear and Greed Index is pointing to Extreme Fear. And the price of copper, a reliable market precursor, is plunging — down seven per cent on Tuesday.
- The Gallup organization says that “for the first time in 35 years, American business deaths now outnumber American business births.” The second part of that sentence — that more American businesses are being closed than opened — comes from the Census Bureau, not Gallup, and is true. The first part — the part that allows the knuckle-draggers to blame it on Obama, is clearly not true, as the data presented by Gallup in its story clearly show this has been the case since 2008.
- The last refuge of irrational hope — the lottery industry — is crumbling. Sales of Powerball tickets were down 40% in the first half of fiscal 2015, after dropping 20% in fiscal 2014.
No doubt Fortune will run a story soon on how American electricians are cleaning up because of the low copper prices, and leading us toward copper independence. And look, the stock market is still levitating!
How did the Everly Brothers put it? “Dream, dream, dream, dream dream dream…. “