American Consumer: Down But Not Out

American Consumer: Down But Not Out

U.S. retail sales edged up 0.5 percent in May, sparked in part by deep discounts, notably in autos. Definitely goods news, indicating the U.S. consumer is recovering. On a related note of optimism, home-improvement retailer Home Depot said fiscal year earnings may not fall as much as feared.

And yet another sign of the shifting consumer: investors are dipping into equities again. Long-term mutual funds have had positive inflows for 12-straight weeks, according to Investment Company Institute.

But reality looks more like a search for a "new normal," as noted by Mohammed El-Erian, CEO and co-CIO of Pimco. Case in point the U.S. auto sector: U.S. auto sales peaked at 17 million in 2005, but a new normal of 10 to 12 million a year going forward seems more likely and hopeful.

So the consumer may be coming out of the bunker, but with unemployment on the rise and debt levels still very high, don't expect a recovery to the free-spending days of a few years ago anytime soon.
http://finance.yahoo.com/techticker/article/262652/American-Consumer:-Down-But-Not-Out

New jobless claims drop more than expected; retail sales rise for first time in 3 months

New jobless claims drop to 601K; retail sales rise
New jobless claims drop more than expected; retail sales rise for first time in 3 months

WASHINGTON (AP) -- The number of newly laid-off Americans filing jobless claims fell more than expected last week and retail sales grew in May for the first time in three months. But a rise in the number of people continuing to receive jobless aid signaled that an economic recovery is still far off.

The Labor Department said Thursday that initial claims for unemployment benefits fell last week by 24,000 to a seasonally adjusted 601,000. That's below analysts' estimates of 615,000.
Still, the number of people claiming benefits for more than a week rose by 59,000 to more than 6.8 million, the highest on records dating to 1967. The department also revised last week's data on continuing claims, replacing what had been a drop of 15,000 with an increase of 6,000.

That means continuing claims have set records for 19 straight weeks. The data lag initial claims by a week.
Retail sales rose for the first time in three months in May, as a rebound in demand at auto dealerships and gas stations helped offset weakness at department stores. The Commerce Department said retail sales increased by 0.5 percent last month, in line with economists' expectations. It was the largest increase since sales rose 1.7 percent in January following six straight declines.

Excluding autos, retail sales also grew 0.5 percent in May, better than the 0.2 percent gain that economists had expected.
Consumers may be spending a bit more and layoffs may be slowing, but companies are reluctant to hire amid the longest recession since World War II. That makes it harder for the unemployed to find work.
Jobless claims are a measure of the pace of layoffs and are seen as a timely, if volatile, indicator of the economy's health.
The four-week average of claims, which smooths out fluctuations, fell to 621,750, down from a high of about 658,000 in early April. Many economists see the decline as a sign that layoffs have peaked and the recession is bottoming out.
Still, the levels are far above what is customary in a healthy economy. Initial claims stood at 388,000 a year ago. Read Article...
http://finance.yahoo.com/news/New-jobless-claims-drop-to-apf-15499914.html;_ylt=AnFrSL.4kfVt62DWnohZ9mm7YWsA?sec=topStories&pos=1&asset=&ccode=

National Retail Federation Issues Black Friday Results & Cyber Monday Forecasts

Results are yet unclear, but it is obvious consumers are hunting for bargains and discounts.
Some results below.

National Retail Federation Issues Black Friday Results & Cyber Monday Forecasts

Women spent on average less then men over the weekend ($333.80 vs. $413.50). More of that amount was spent online by men then by women ($142.66 vs. $93.26). Average spending was highest in the Northeast ($397.31) and South ($394.71) and lowest in the West ($314.06), with the Midwest ($359.48) falling in between.

Over half - 55.8% - of employees with internet access at work said they plan to shop from work on Cyber Monday. This is a significant increase from 2005, when only 44.7% (59 million) had plans to do so. Men are slightly more likely then women to plan to shop on Cyber Monday (38.5% vs. 35.9%). Consumers with incomes over $50k or aged 18-34 are most likely to participate in Cyber Monday. Those over aged 55 or with incomes under $50k are least likely to shop that day.

Strong Black Friday sales up a surprisingly 3.0 Percent compared to 2007.

Not all bad News, nov 30th. Strong Black Friday sales up a surprisingly 3.0 Percent compared to 2007.
Retailers have to slash prices and offer huge discounts.
News from ShopperTrak RCT Corp., a Chicago-based research firm that tracks sales at more than 50,000 retail outlets. Black Friday sales are not always the best indicator for the rest of the Christmas shopping season but give reason for some cautious optimism early in the season this time.


29 Nov RETAILERS FACE MELTDOWN AS CHRISTMAS NEARS
The economic bloodbath that has impacted all sectors of the American economy hit retailers hard during the last month, just as they were gearing up for the make-or-break Christmas selling season.
Of the 26 retail categories surveyed by America’s Research Group for our Consumer Mind Reader™ survey, only three saw increases over last year’s shopping levels.
Discount stores enjoyed consumer spending levels rising from $195.80 last year to $203.95 in this survey. Consumers also spent more at national department stores and hardware stores.
Categories that were especially hard-hit by the recessionary habits included apparel stores, catalog sales, and toy and jewelry retailers. Even the Internet, which had remained steady and even showed some growth, was not immune to the economic woes. Web shopping levels declined steeply, from $46.22 a year ago to $27.73 in this survey.