— There used to be a saying, “they way that General Motors goes, so goes the economy.” Now it’s Walmart. Pathetic.
FT.com / Industries / Retailing & leisure – Fears over recovery as Wal-Mart sales stall
Worries about the sustainability of the US economic recovery were stoked at the weekend after Wal-Mart, the discount retailer that is a bellwether for the country’s retail sector, said sales grew by only 0.7 per cent in the year to November.
The world’s largest retailer had estimated growth of 2 to 4 per cent just 10 days ago. But Wal-Mart revised its estimates down on Saturday evening after disappointing sales on %u201CBlack Friday%u201D, the day after Thanksgiving traditionally one of the biggest shopping days in the US.
It always weirds me out that economists get so hot and bothered when the economy isn’t growing as fast as they think it should — it’s GROWING, big whoop how fast. Even if it’s shrinking, it’s gonna be OK in the end. Maybe painful for a few years, but OK. Sheesh, lighten up!
I guess it’s understandable fear for economists whose careers rely upon developing a track record for good forecasting (I’d love to see a website grade economists’ and money mgr’s prediction scores over time), but the headlines for the rest of us always seem to make things out to be far more dire than they really are, given sober consideration of all the details relevant to the discussion of the state of human comfort.
Mostly, I think the real problem is just that most people watch too much TV and that makes most people way too impatient.
Think over the last 80 years. You gotta admit: it’s getting better — practically all the time.
Walmart same store sales can’t grow. Too many people go there and it takes 45 minutes to check out. It’s a bottleneck. Besides, since Walmart does not do sales or special financing, there is little motivation to go there on Day X vs. Day Y or Day Z.
As a result, the fact that Walmart growth on the busiest shopping day of the year was stagnant should not be a surprise, but expected.
Walmart is suffering from the bane of any publicly-traded company. Growth is required for investors to see gains on their investment – once the economies of scale and cost-reductions are tapped-out.
The insanity of: Profit is not enough! Profit must increase over time!
Once each store reaches a saturation-point on sales, they have to build another store to get an increase – ad naseum.
Starbucks, McDonalds, every big chain is a pyramid scam in action – desperately filling in at the bottom (new stores) so the top can cash-out. 🙁
That these chains have gone global, to keep expanding, makes me wonder what the economy will be like when the world is saturated – and they can’t build any new stores anywhere.
What percentage of the world’s population will be working for a handfull of companies?