Walmart’s customers are running out of money.
That’s both a symptom of and a bad portent for the economy.
[Update a few minutes later]
Somehow, I can’t help but think that this is related: consumer confidence in the economy’s future is at the lowest point yet in the Obama presidency. And it wasn’t high when it started.
I suspect that won’t change before November. And even then, we’ll be stuck with him for another two years, though at least he’ll be defanged. As Glenn often says, another Jimmy Carter is a best-case scenario.
[Update a couple minutes later]
This was particularly disturbing:
Forty-six percent (46%) of all adults now say it is at least somewhat likely the United States will enter an economic depression similar to the 1930s within the next few years, showing little change in this view over the past two months. That number includes 21% who say it’s very likely. Another 46% see a 1930s-like Depression as not likely, but just nine percent (9%) say it’s not at all likely.
I think that the probability of that depends on the voters, this cycle and next. If they keep reelecting people who enact policies that, for whatever reasons, continue to sicken the economy, as they did in the thirties, it could get really bad. I hope that the voters are smarter this time around. It’s possible to learn from history, at least in theory.
Hey, Carol Browner just told us this morning that the stimulus saved 2 million jobs, staved off a major economic collapse, and brought about 6% growth in the last quarter of last year. How dare you bring up facts that get in the way? The recession’s over…don’t you get that?
If you believe Strauss & Howe, the Boomers (and to some extent the Xers) will indeed continue to find ways to screw things up for some years yet. But the ’20s will be great.
OK, so consumer electronics are getting cheaper…I still can’t spare the money no matter how good of a deal it is. We’ve been working hard to eliminate debt and refuse to use credit anymore.
I suspect (hope?) that’s at the root of what’s going on. Too many people financed their “goodies” for too long on phony money…if you figure (guess) 15% of purchases in the past were on credit that’s no longer being used, that’s a sizeable chunk of the economy.
If the DC clowns force-feed us a national health plan and some form of cap & trade, I think a Depression is guaranteed. Especially if the Dems pull it off before they get thrown out this fall…a Repub majority probably won’t be veto-proof, therefore unable roll back any of that crap without The Big O’s signature.
Claptrap is falling.
Claptrap is the City of Clevers in Pilgrim’s Regress (CS Lewis). It is the city of iron that falls most suddenly of all cities.
So Jay, things will be better in my 60s and 70’s?! Screw that second cup of coffee, I’m just going back to bed.
I look forward to hanging out with my fellow geezers at the 2030 equivalents of restaurants that serve red-meat breakfasts, cackling at youngsters and telling stories about punch-card programming and phones that were bolted to kitchen walls. Actually, I’m already doing that.
And if Walmart’s customers are running out of money, that will mean Walmart might go out of business and that would be very bad for the economy. The Chinese economy, that is.
I’m spending much less at Walmart than I used to. It’s not that I’m running out of money, it’s that I find shopping at Wallyworld is like pulling teeth, I hate going there. I’ve been doing more of my shopping elsewhere.
Agreed, MfK. They are our betters, so we should trust them. In fact, we should give them even more.
As to the confidence numbers, isn’t there a Zero-style ‘created or saved‘ angle here? Along the lines of, think how much worse it would have been without Porkulus.
Jay M. – don’t forget about LPs, 8-tracks, and VHS – you are educating tomorrow’s leaders.
“Back in my days, we din’t have occipital lobe induction modules, just PS3s…” /geezer
Our family shopped at Walmart regularly, doing a lot of our grocery shopping there. Bless my wife, she does a lot of price comparisons and no longer buys groceries at Walmart because they no longer are the price leader.
The article linked at the top of this posting included the following statement: “Wall Street is no longer giving the company credit for impressive efforts to cut costs and boost profits. ” Several things come to mind here…perhaps Wall Street perceives that Walmart has squeezed virtually all of the waste out of their impressive supply chain capabilities; maybe they perceive that their competitors have learned from Walmart’s supply chain success and has significantly closed the gap in the advantage that Walmart previously enjoyed; maybe they perceive that customers are more adept at utilizing easy access to information and internet-based shopping and can more easily find better pricing elsewhere. Probably a combination of the three.
Whatever Wall Street’s perceptions, Walmart has lost our family’s business for the time being when it comes to groceries simply because we can save around ten percent by going to Kroger. When Walmart offers lower prices we’ll be back.
There’s always a sweet spot for profit and it’s almost never the lowest price. The question seems to be, is Walmart the canary in the mine? If jobs don’t come back do we get a phase change where they never come back? We need a strong middle class.
Part of Wal-Mart’s problem: They don’t have enough checkouts. And in the middle of a sinking economy, they’ll make you stand in line with your purchase for five to ten minutes with nothing to do (that is, if you don’t like reading People) but _think_ about your problems and if you _really_ need to buy what you’re buying or maybe you’d be better off putting off the purchase instead.
In good times this was extra time for impulse purchases of the sort of junk they have in the checkout line. But in these days it’s just more time for their shoppers to give in to the impulse to NOT spend the money.
Yea I’ve noticed also that Kroger’s prices have become comparable and if not better in some cases to Walmart, also. There is more variety and better prices on beer. The meat is cheaper and many cases better quality. I think Walmart does better on the price of frozen dinners and pizza though. Plus, as pointed out, the wait in the lines at Kroger isn’t usually as bad as Walmart.