Sears Holdings Sharply Cuts Profit Guidance as Sales SlipRETAIL, EARNINGS, GUIDANCE, OUTLOOKBy CNBC.comCNBC.com| 14 Jan 2008 | 06:52 AM ET
Sears Holdings, the operator of Sears and Kmart, said Monday its fiscal fourth-quarter profit will be well below its year-ago results and current Wall Street forecasts as sales at both chains declined over the last nine weeks.
Sears Holdings said it now expects to earn between $350 million and $470 million, or $2.59 to $3.48 a share, for the three months ending Feb. 2, down from $820 million, or $5.33 a share in the same quarter a year ago.
Analysts surveyed by Thomson Financial predicted a profit of $4.43 a share.
Sales at stores open at least a year fell 2.8% at Sears and 4.2% at Kmart for the nine weeks ended Jan. 5.
The company said it "experienced lower sales across most categories, with notable declines in the Sears apparel and tools categories and the Kmart seasonal categories."
"We believe that comparable store sales results reflect increased competition and the negative impact of unfavorable economic conditions, such as a weak housing market and consumer credit concerns," Sears Holdings said in a statement.
Shares of Sears Holdings sank more than 9 percent in German trading.
© 2008 CNBC.com
Americans Cut Back Sharply on SpendingBUSINESS BIZ COMPANIES MARKETS RETAIL SPENDING CONSUMER ECONOMYBy Micahael Barbaro and Louis Uchitelle,The New York TimesThe New York Times| 14 Jan 2008 | 04:17 AM ET
Strong evidence is emerging that consumer spending, a bulwark against recession over the last year even as energy prices surged and the housing market sputtered, has begun to slow sharply at every level of the American economy, from the working class to the wealthy.
The abrupt pullback raises the possibility that the country may be experiencing a rare decline in personal consumption, not just a slower rate of growth. Such a decline would be the first since 1991, and it would almost certainly push the entire economy into a recession in the middle of an election year.
There are mounting anecdotal signs that beginning in December Americans cut back significantly on personal consumption, which accounts for 70 percent of the economy.
A raft of consumer companies -- high-end stores like Nordstrom and Tiffany , and middle-of-the-road ones like Target and JC Penney -- reported a pronounced slowdown in growth last month, and in several cases an outright drop in business.
American Express said that starting in early December the growth in the rate of spending by its 52 million cardholders, a generally affluent group of consumers, fell 3 percentage points, from 13 percent to 10 percent, the first slowdown since the 2001 recession.
And consumer confidence, an important barometer of economic health, has plunged. Andrew Kohut, president of the Pew Research Center, says consumer satisfaction with the economy has reached a 15-year low, according to the firm's polling.
Even wealthier consumers, who were seen as invulnerable to rising gasoline prices and falling home values, are feeling the squeeze.
"People are clearly concerned that we are headed into a recession," said Stephen I. Sadove, the chief executive of Saks Fifth Avenue , the upscale department store whose runaway growth throughout much of the year slowed markedly in December.
Gia Trumpler, 37, a travel consultant who lives in Manhattan, shops at luxury chains like Saks. But she is trimming costs where she can by bringing lunch to work from home, rather than eating out. "Everything just feels more expensive to me now," she said, including the cost of heating her apartment this winter.
There are plenty of recession naysayers. Average hourly wages and salaries have not fallen, and some economists argue that unless -- or until -- that happens, consumer spending will hold up despite widespread economic unease. According to these economists, what happened in December was a temporary blip.
"Incomes have managed to hold up," said Chris Varvares, president of Macroeconomic Advisers, an economic forecasting firm, who added that the data to date did not support the view that a recession was inevitable.
Slower Growth Instead of Cutting Back
Even in tough economic times Americans rarely reduce their consumption, preferring instead to slow the growth in their spending. Since 1980, they have cut spending in only five quarters -- a total of 15 months -- most of them in the depths of a recession. The 2001 recession passed without a cutback in consumer spending.
Only once before, in 1980, did consumer spending fall during a presidential election year, helping Ronald Reagan in his campaign against Jimmy Carter, the Democratic incumbent.
Official statistics do not yet show that consumer spending has dropped, but they do suggest that in late 2007, it slowed in areas like automobiles, furniture, building materials and health care, said Mark M. Zandi, chief economist at Moody’s Economy.com.
Fresh evidence of a pullback is pouring in from many quarters as Americans confront the triple threats of higher energy costs, falling home prices and a volatile stock market.
Perhaps the strongest barometer over the last 30 days is the performance of the country’s big chain stores. December turned out to be a blood bath for retailers at every rung on the economic ladder, with sales for the month growing at the slowest rate in seven years.
Sales at stores open at least a year, a crucial yardstick in retailing, plunged by 11 percent at Kohl's and 7.9 percent at Macy's , compared with last year.
Chains that cater to the middle and upper classes, which have benefited from years of trading up -- when customers splurge on select expensive products -- struggled as well. Coach , the leather goods maker, said sales of its popular handbags had become sluggish, prompting the company to issue rare coupons to drum up business.
"This is the real deal -- consumers are slowing down across the spectrum,” said David Schick, a retail analyst at Stifel Nicolaus.
High-End Stores Hurt
But it is the trouble at the highest reaches of retailing that has economists most worried about a recession. Over the last year, even as low-wage and middle-income consumers have cut back, the wealthy have spent freely, keeping high-end chains insulated from the economic turbulence.
That started to change in December, as shoppers held off on buying $300 designer shoes and $500 dresses. For example, store sales fell 4 percent at Nordstrom, the high-end department store.
And Tiffany, the upscale jeweler, said the number of purchases at its stores dropped last month. In an interview, its chief executive, Michael J. Kowalski, said that even if the wealthy remain so at least on paper, their economic anxiety is taking a toll.
|It’s a reaction to the general economic uncertainty everyone is feeling," he said. "There are housing price declines and financial market instability. There is a lot of caution out there, and it’s reflected in jewelry sales."
At the same time, the number of overdue payments on American Express cards is surging, the company said -- and this among well-heeled cardholders who charge up to $12,000 a year, on average, on each card. American Express has called some cardholders in the last few weeks to ask if they will have trouble paying their bills.
"We are seeing a correlation with housing prices," said Michael O’Neill, a spokesman for American Express. "The falloff in spending is everywhere in the country, but it is greatest in those areas like south Florida and California, where home prices have fallen the most."
The big exception is gasoline. American Express and the Consumer Federation of America say that consumers are buying just as many gallons as ever, but paying more for them, and that has forced cutbacks in other purchases. Gasoline prices usually drop after the summer driving season, but this year they shot up, from $2.85 a gallon on average in September to $3.07 in December and $3.15 in the first week of January.
A similar trend is evident in the cost of natural gas, electricity and home heating oil. "We built these big houses in the suburbs, which need a lot of energy to stay warm and a car to go shopping," said Stephen Brobeck, executive director of the Consumer Federation. "And we can’t change that quickly."
The impact of rising gasoline prices "is just profound on middle- and lower-income families," said Mr. Kohut of the Pew center. "Our surveys are showing one of the lowest levels of satisfaction with national conditions in any recent presidential election year. You have to go back to 1992 to get a lower number of people saying the national economy is excellent or good."
The nation was recovering from recession that year. Consumer spending had contracted in two separate quarters in 1991, and while economic growth was gradually accelerating as Bill Clinton and George H. W. Bush sought the presidency, the Clinton camp famously posted a sign in its campaign war room proclaiming, "It’s the economy, stupid."
Some Bright Spots
There are some bright spots now in consumer spending. Sales of sports gear and electronic gadgets -- particularly G.P.S. navigation devices and flat-panel television sets--— have risen over the last three months. To Stephen Baker, vice president for industry analysis at the research firm NPD Group, that suggests there is still enough purchasing power for people to buy what they really want.
"We probably would not have seen strong sales for electronics products that people really want if the overriding issue was economic," Mr. Baker said.
But not everyone is splurging. Jinal Shah, 22, a college senior in New York, said she wanted to buy the popular Nintendo Wii video game system as a gift for herself this holiday season, but had second thoughts because of the $250 price tag. She ended up not purchasing it.
"You have to make choices," she said. "I get the Wii, or I go out more. I am just much more aware of the tradeoff now."
Copyright © 2008 The New York Times
Dieser Rückgang wird durch Orders aus Mittleren Osten und Asien noch mehr als ausgeglichen aber auch hier müssen, was lange nicht vorgekommen ist, preiszugeständnisse gemacht werden. Wir leiden unter dem starken €.
mfg
Weak Retail Sales Report Could Signal RecessionWEAK RETAIL SALES REPORT COULD SIGNAL RECESSIONBy ReutersReuters| 14 Jan 2008 | 03:47 PM ET
Whether it's Big Macs, big rocks or big trucks, U.S. consumers are tightening their purse strings, and the squeeze may be severe enough to topple the U.S. economy into recession.
On Tuesday, economists expect the Commerce Department to report flat retail sales for December, and some suspect that the number could be negative as the housing downturn, tougher credit conditions and steep inflation sink household spending.
A negative reading in December would mark the first decline since June.
"December's retail sales update may tell whether consumer spending has the legs to keep the expansion on track," Global Insight economists wrote in a note to clients.
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The 'R' Word -- How to Invest:
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Economists were bracing for a soft sales report after a host of retailers posted disappointing holiday season sales figures in recent days. Consumer spending accounts for more than two-thirds of U.S. economic activity, which explains why economists pay such close attention.
What they found particularly worrying was the breadth of the slowdown. The bad consumer spending news has come not only from Big Mac maker McDonald's and lower-priced retailers Kmart and Sears, but also luxury chains such as jeweler Tiffany.
"We believe a recent pullback in U.S. spending likely reflected a more cautious attitude among consumers about the near-term direction of the economy," Tiffany CEO Michael Kowalski said last week.
Monday, Ford Motor said that industrywide auto sales would likely drop in the first half of 2008.
U.S. recession talk picked up after disappointing data on December employment and manufacturing, and a subpar holiday shopping season has added to the gloom.
Sales may suffer more in the coming months as tightening credit conditions spread beyond the housing market and into credit cards, the crutch that has increasingly supported consumer spending as mortgage refinancing slows.
"In the easy housing money years, consumers were racking up debt on their credit cards, then rolling that debt into lower-interest home equity loans or using cash-out refinancings to pay down the higher interest rate credit card debt," said Gary Balter, retail sector analyst with Credit Suisse.
"With that safety net no longer available, credit card balances are growing sharply, increasing debt servicing costs. Consumers are struggling to meet these costs, evidenced by mounting credit card delinquencies and losses."
Credit card debt jumped by 11.3 percent to $937.5 billion in November, according to Federal Reserve data.
Credit card company American Express warned last week that delinquencies were on the rise, particularly in California, Florida and other regions hardest hit by the housing downturn.
Credit Suisse's Balter said credit card issuers were tightening lending standards as their own borrowing costs rose, an increase that comes despite a series of Fed interest rate cuts that have shaved a full percentage point off the benchmark federal funds rate since mid-September.
Nervousness in the asset-backed securities market, where consumer loans are typically packaged and sold to investors, has raised costs for credit card issuers, and they will likely
try to recoup that by charging customers more, Balter said.
"We are already seeing the impact of tougher mortgage standards on the housing market," Balter said. "With credit card delinquencies rising and securitizations tougher to do, we
worry when that shoe will drop, further impacting retail spending."
Balter lowered investment ratings and stock price targets on a host of retailers Monday. Goldman Sachs Monday also took a dimmer dimmer view of retailers across the price spectrum, from handbag maker Coach to Sears, owner of Kmart and Sears stores.
Even the retailers' trade association said 2008 looked less than rosy. The National Retail Federation said retail sales would likely grow 3.5 percent from a year earlier, the slowest
pace in six years.
"We don't know whether it will be a recession or not," NRF Chief Economist Rosalind Wells said. "It's just not going to feel good to anyone."
Copyright 2008 Reuters. Click for restrictions.URL: http://www.cnbc.com/id/22651188/
Plötzlich sind die Fragezeichen wieder da. Nach Fragen wie: Wie viel würde das in polnischen Zloty kosten?
Das Problem mit der Finanzwelt ist, dass nichts still steht. Vor ein paar Tagen las ich in der Zeitung, dass die Hauspreise in Großbritannien weiter zurückgehen. Während der Immobilienblase sind die britischen Häuser noch mehr im Preis gestiegen als die Häuser in den Vereinigten Staaten. Sie haben vermutlich noch einen weiten Weg vor sich.
Aber was ist das? ... Gemessen an Gold sind die Häuser in Großbritannien in den vergangenen drei Jahren im Preis zurückgegangen. Mal sehen. Wenn man die amerikanischen Hauspreise in Gold ausgezeichnet hätte, dann würde ein Haus 1997 durchschnittlich 670 Unzen Gold gekostet haben. Heute kostet das gleiche Haus 500 Unzen Gold.
Und in Euro ausgezeichnet hätte ein durchschnittliches amerikanisches Haus 1998 ungefähr 250.000 Dollar gekostet. Heute, nachdem sich der Preis in Dollar fast verdoppelt hat, kostet es nur ungefähr 275.000 Euro. Nach Abzug der Kosten für den Unterhalt und die Steuern, hat der Hausbesitzer sogar Verlust gemacht. Aber was interessiert es den Hausbesitzer, was sein Haus in Euro oder Gold wert ist?
Mein Kollege Steve Sjuggerud hat eine Tabelle an mich weitergeleitet, die zeigt, dass Rückgänge bei Immobilien und Bärenmärkte an der Wall Street immer gemeinsam auftreten. "Es ist nur eine Frage der Zeit, sagt Steve... Behalten Sie das im Hinterkopf, liebe Leser. Und seien Sie besorgt. Nach einer langen Zeit, in der alles so sicher schien...
What, US worry? | ||||
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Good Afternoon,
New York spot gold closed a hair above $880, adding a meager 60 cents on the final day of this roller-coaster ride of a week. While the US dollar rose to 76.38 on the index and crude oil remains very near $90, the focus has now shifted to the economic stimulus package and how it may/may not be too little, to late, both, or neither. A combination of tax relief and interest rate cuts have been called for in order to keep the US economy from sliding off the runway as it attempts a soft-landing. Rate cuts bets for the end of the month range from 50bp to a full point.
Markets (stocks and gold for that matter), on the other hand, -at least yesterday and then today as well- appeared to be thinking about something else in somewhat of a disconnect. Perhaps the Fed chief lacks the necessary "street cred" as yet. Participants remain undecided whether a recessionary contraction will dampen metals demand first, or fears of the eventual inflationary effects of these measures will spur demand and override such concerns. Silver gained 19 cents to finish at $16.09 and platinum dropped $13 to $1545.00 per ounce.
Gold finished the week some fifteen dollars under where it was last Friday, after capping a wild week indeed. Today's theme du jour was more hand-wringing about...everything. WaMu looks like a candidate for life support (another $2 billion to the credit shredder), leading economic indicators slipped in December, and officials tried to put a nice spin on things by offering...more of the same. Ah, but if ever there was a picture that speaks a library of volumes, here it is:
http://www.nytimes.com/2008/01/18/business/18cnd-econ.html
Notwithstanding that the appropriate body language would have had one of them covering his ears, the other his eyes, and the third one his mouth, these fellows look very worried and as if they had been up all night. Which, they probably were. Something has to be done, that much you've been told. Trouble is, people will take their rebate and put it into a savings account as they still fear for their jobs and already have nine iPods on average (ok, that's a stretch). But, being a political year and all, nice try. The best summation of this package and the likely outcome of its being placed into effect is found in this sharp article by the Wall Street Journal. For a change (and in the interest of space) we will provide the link only. Let's just say the title is " No Stimulus Gimmicks, Please" Happy reading.
http://online.wsj.com/article/...7.html?mod=opinion_main_commentaries
Last month we advised you of our projection that China was likely to capture the top spot in global gold production. Our visits and talks with various officials in Shanghai and Beijing reinforced our belief. We now have full confirmation of this amazing achievement. In just one year, China jumped nearly four spots on the top-ten list to plant its flag at the summit of gold producers. Laura Mandaro at Marketwatch reports on the record in a timely piece:
"China became the world's largest gold producer last year, helped by Canadian- and Australian-led projects that aim to add millions in ounces to the world gold supply. China produced 276 metric tons of gold last year, equal to about 9.7 million ounces, said London precious metals consultancy GFMS Ltd. in a report released Thursday. That's up 12% from the year-ago and represented just over one-tenth of the world's supply.
The ranking pushes South Africa into second place, the first time the gold giant has lost its top ranking since 1905, GFMS said. South Africa, whose late 19th century gold rush led to the founding of mining heavyweight Anglo American Plc saw its production decline 8% to 272 metric tons.
The title of top gold producer adds to a list of raw materials China can claim to produce more than any other country, including aluminum and steel. It's not likely to loose that lead anytime soon as more foreign producers make inroads in China's untapped mining fields.
Most of China's gold output stays in the country where it's transformed into jewelry and manufactured items, though the country's export role is increasing. Last year fabrication rose 18%, helped by demand from China's increasingly wealthy middle- and upper class."
Aside from this commendable performance by China, we also need to bear in mind the prospect of overall growth in global gold output. There are dozens of operations slated to come on line in the next 60 months in various parts of the world, and they could add anywhere from 15 to 25 percent to gold's annual production figures.
Stay on the nimble side as the great whites are still out in force in these waters. Some are visible, some not.
Best regards,
Jon Nadler
Senior Analyst
Kitco Bullion Dealers Montreal
| HANDELSBLATT, Samstag, 26. Januar 2008, 16:08 Uhr |
GegenpositionDas Ende der IllusionenVon Hermann Josef Knipper |
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