Stockman says perilous period of danger, disorder, and decline in World Financial markets. Ship of Fools taking us to the wall. Yellen is a knee-jerk Keynesian. When you have the money market rate at zero for 68 months running, then you encourage over speculation an over valuation causing instability. Draghi in Europe has caused a bond bubble in Europe through constant verbal intervention. Japan has a balance sheet that is pushing 50% of GDP. Printing Yen like there is no tomorrow. Situation could come unwound any day. Bank in Portugal (small) is an example. Matter of time before a Big Catalyst is going to hit.
$1.25 quadrillion in derivatives is a dangerous system. Back half of this year will bring surprises. We have had a false calm. Markets are so over extended, before a Black Swan event brings a major dislocation. When the panic comes, then Gold will be a safe haven. End game is that Stockman is surprised how long this bubble has been able to inflate. Junk Bond market is at an all time high. Real estate reaching new bubble extremes. Not much time left. Bond market has been artificial to the extreme for years. The Fed is tipping the scales. No honest price discovery or yields. Tremendous distortion. Prices are way overvalued. Central Banks will eventually lose control. Investors will quickly seek an exit when the Fed's prop falters.
Only hope for the West is the the Big Bang Dislocation that we need, the Keynesian banking will be so dicredited that we will get a chance to reset the system. Not great hope, but at least a possibility that there will be a clearing of the deck and a chance to start over. Police State is frightening. Part of the big picture. In 2014, no State (country) enemies, but we have nearly an all-time defense budget in real term and greater than the next eight countries combined. Warfare State drifting into domestic police forces, because it is pork barrel, job creation program, and money system driving national policy.
Q2 GDP Hopes Fade As Wholesale Inventories Miss By Most In 2014 - Zero Hedge - Tyler Durden - July 10, 2014 - Another day, another uncomfortable fact about Q2 not being the epic bounce back that so many had promised. Wholesale Inventories rose only 0.5% in May - following April's +1.1%. This is the slowest growth in 2014 and biggest miss of expectations since Dec 2013. Wholesale sales also fel back, missing expectations at +0.7%, to the slowest since Feb as April hopes fade. Cue, Q2 GDP downgrades in 3...2...1...
Family Dollar closing 30 Carolinas stores; none in Charlotte - Charlotte Observer - Ely Portillo - June 30, 2014 - ...In April, Family Dollar said that it would close 370 under-performing stores nationwide, as sales and profits fell. The discount retailer also said it would lower prices on 1,000 items in an attempt to lure shoppers back. Family Dollar, whose president departed unexpectedly in January, has struggled to keep up with its rivals, especially larger Dollar General. Family Dollar’s challenges have mounted recently. Prominent activist investor Carl Icahn, a longtime corporate fighter, bought a 9.4 percent stake in the company. He demanded that the company be sold immediately and said he will move to fire and replace the entire board if he doesn’t get his way. Analysts have speculated that Family Dollar could be purchased by a private equity firm or by a rival such as Dollar General. But a Dollar General takeover has been seen as increasingly unlikely, especially in the wake of Dollar General CEO Rick Dreiling’s announcement last week that he plans to retire next year.
10 Brands That Will Disappear in 2015 - Wall St 24/7 - Douglas A. McIntyre - July 8, 2014 -
3. Hillshire Brands
5. Alaska Air
6. Russell Stover
8. Time Warner Cable
Wal-Mart scrambles to reinvent itself as sales slump - The company is shrinking its massive stores and selling more gas and booze. It's also revving up its online operations. - MSN Money - Shelly Banjo, The Wall Street Journal - July 8, 2014 - Just weeks after being named chief executive of the world's biggest retailer, Wal-Mart's Doug McMillon held a meeting with his top executives and gave them a homework assignment: Read "The Everything Store," the tell-all book about Amazon.com founder Jeff Bezos. It was a surprising order from the top of a company that long ago devised one of retail's most successful formulas and milked it for nearly half a trillion dollars in sales last year. According to the book, Mr. Bezos himself studied Wal-Mart as he built Amazon (AMZN +5.57%), internalizing its credo of acting fast and experimenting often. But now, with the price gap shrinking between Wal-Mart Stores (WMT -0.31%) and its competitors, the retailing giant faces the double sorrow of sluggish sales and traffic. In May, the company reported its fifth straight quarter of negative U.S. sales, excluding newly opened or closed stores, and its sixth straight quarter of dwindling traffic. Wal-Mart's return on investment dropped to 17 percent in the year ended Jan. 31, down from 20 percent seven years ago. The weak results led to the lowest levels of bonuses to executives in several years...
10 companies that put nearly all the food on supermarket shelves - MarkeyWatch Wall Street Journal - July 8, 2014
Container Store CEO: America facing a 'retail funk' - Yahoo Finance - Jeff Macke - July 9, 2014 - fter more than five years of reckless stimulus, endless rate manipulation and generally artificial life support the bull market faces a new challenge from the most unlikely place. It's not the Fed but the consumer that could derail the recovery, at least according to a what we heard from a couple of retail execs on Tuesday. In a conference call last night. The Container Store (TCS) CEO Kip Tindell said America is facing a "retail funk." Not funky, with connotations of heavy bass and jewelry purchases, but funk as in gloominess and general lassitude. Tindell took the unprecedented step of retroactively un-blaming the weather for weakness in The Container Stores first quarter results. "It's more than just weather" said Tindell, "With so many of our fellow retailers we're experiencing a retail funk." Tindell's remarks echoed comments earlier in the day from Walmart (WMT) U.S. head Bill Simon who said the job recovery wasn't leading to an increase in spending by Walmart customers. Simon says things aren't getting worse for middle class Americans as far as he can tell. He's just not seeing improvements. Lacking Tindell's sense of rhythm Simon suggested that perhaps consumers from the middle class down are splurging on events like the 4th of July but pulling back on day to day spending. Simon says this spending behavior is "not the best thing in the world for retailers."
Where The Wealth Is (and Is Not) - Zero Hedge - Tyler Durden - July 10, 2014 - On the heels of Wal-Mart explaining that America is anything but recovering, we thought a look at the state of the union's wealth would be useful. To wit, the following map of household incomes shows where the "haves" and the "have-nots" reside...