Years ago when I was in high school – having fun and chasing girls – the last thing I ever thought I’d enjoy was spending my mornings with a freezing cup of iced coffee, looking at how sectors of the S&P 500 performed over the past 365 days.
Amazon (Nasdaq:AMZN) has declared that the holiday season was its “best ever”. But despite its cost advantages over bricks and mortar retailers, Adam Lass says the company will struggle to profit during this recession. Amazon’s earnings report on Friday could reveal the troubles that lie ahead. And that means a chance for quick profits with short selling or put options.
Circuit City was the latest bankruptcy domino to fall last week. Andrew Snyder says more big-name retailers could soon follow. But this is just the economy working as it should. The weak fail and the strong just get stronger. Andrew says the fall of Circuit City is great news for Best Buy (NYSE:BBY), who will become clear market leader once this crisis is over.
The American dream is drowning in debt, says Andrew Gordon. The middle class are being squeezed as tumbling asset prices hack away at household wealth. And things won’t change unless the government steps up to the plate.
The fate of the ‘Big Three’ still hangs in the balance as the government ponders a bailout. Andrew Snyder says auto dealerships are also at the mercy of their Detroit suppliers. He says a lot of things have to go right for most dealers to survive this crisis. That’s why bottom-fishing investors should look for well-diversified retailers like Wal-Mart (NYSE:WMT).
Saving is coming back into vogue in the US, says Bill Bonner. Americans need to recover their losses. But that is murder on an economy built almost entirely on consumption. And as the ailing retail sector sheds jobs, this recessionary cycle will get much, much worse.
With the economy eroding at an alarming pace, it is no wonder investors are turning away from their former retail haunts filled with trendy, over-priced items.
Stores like Whole Foods (NASDAQ:WFMI) and Trader Joes are watching their customers head to low-cost competitors like Wal-Mart (NYSE:WMT) and Safeway (NYSE:SWY).
It is no surprise to see an ultra-cheap retailer like 99 Cents Only Stores (NYSE:NDN) climb its way to the sole spot on the list of companies reaching 52-week highs today. The global economic crisis has actually been the best thing to happen to the company’s share price in a long time.
The rationale behind the positive run is obvious. When the economy is in the gutter, consumers have less money to spend on the things…
Another stimulus check should be coming our way as the market keeps falling.
If it doesn’t happen as one of the final acts of the Bush administration, it will happen as one of the first acts of the Obama one.
The question is, will it help the fast-falling auto industry?
It’ll help retailers. The overwhelming evidence is that the last round of stimulus checks helped pick up consumer spending in the second and third quarters.
But big-ticket retailers like auto dealers play in another sandbox entirely. Unless these checks have a couple of more zero’s than the previous ones, the auto industry’s fate is tied to getting another $25-billion loan package from the government.
The auto industry needs it. And from Obama’s latest statements, it…
Adam Lass says the vast majority of retailers are ripe for shorting as a new era of thrift grips the US. Aside from bargain stores like Wal-Mart (NYSE:WMT) and the 99 Cents Only Store (NYSE:NDN), Adam says investors should buy put options on retail firms. And the best time to do this is when they talk of “better times to come”…