CONSUMER DROWNING SORROWS AT THE BAR

Month after month I watch as the MSM mouthpieces try to spin declining consumer spending in a positive light. They are practically out of excuses. They are befuddled, because month after month they report “awesome” job gains and can’t understand why all these gainfully employed Americans aren’t buying shit they don’t need like they used to. These faux journalists, spouting propaganda for their ruling class bosses, are willfully ignorant of the fact the job gains are in low paying part-time jobs and the fact that Obamacare and record high rents are sapping any discretionary income households would use to buy stuff.

Despite the propaganda from the media and happy talk from the Liar-in-Chief, the country is currently in a recession and the Fed has no ammo to fake another recovery. We are going down and going down hard. When 70% of your economy is based on Americans buying shit they don’t need from China on credit cards, a dramatic slowdown in consumer spending equals recession. When sales actually fall from November to December during the holiday season, you are in recession. We’ve arrived.

The December report was a disaster and portends horrible retailer results coming down the road. More ghost malls coming to your neighborhood. The annual results were pitiful, with the more recent months even more dreadful. So after adding 10 million jobs, according to Obama, spending declines? They must be great jobs.

I think the results are even worse than portrayed in the results presented by the Census Bureau. Retail sales grew by only 2.2% in 2015 versus 2014. That is significantly less than the real inflation being experienced by real people, so on an inflation adjusted basis they fell. Even the 2.2% increase is artificially pumped up by the Fed induced auto debt fueled boom in car sales (or long-term rentals in reality). The 7 year 0% auto loans, subprime auto loans to deadbeats, and record levels of auto leases have created fake demand that will end in tears when the defaults skyrocket. If you remove these fake sales, then total retail sales are up a pitiful 0.9% over 2014.

When you realize that two of the few strong sales categories were autos (7.5%) and furniture stores (5.8%), you can put your thinking cap on and realize the 7 year 0% financing scam is solely responsible for these sales. Reducing credit score criteria and extending loan terms always works. Right? The other relatively strong area was internet sales (6.3%). Amazon and the rest of the on-line retail segment continues to destroy the bricks and mortar retailers, but even these sales are slowing. They were up a weak 0.3% from November. Before the states started taxing internet sales and it was still a newer concept, the annual growth rates were 15% to 20%, so the 6.3% growth rate is rather unimpressive.

And this leads me to the strongest spending segment – restaurants/bars. Sales were up 8.1% over 2014 and continued strong in December. I know this is true firsthand as my wife is a waitress at a restaurant/sports bar and business was booming in December and continues to be good in January. My thesis for this strong spending is that people are so miserable about the economy in general and the direction of the country (reflected in Trump’s support), they have decided to drink and eat, for tomorrow we die. Dining out or getting loaded at a bar takes your mind off your troubles for a few hours. It’s not a huge expenditure and you just put it on your credit card and worry about it later.

When the mass layoffs start hitting in 2016, even this category of spending will contract. If you think the 2015 consumer spending numbers were atrocious, you haven’t seen anything yet.

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ILuvCO2
ILuvCO2
flash
flash

@Tom Stamps, you read , but you don’t comprehend .The trashman was just my example of the service sectors’ dwindling purchasing power, thanks to banksters nefarious control over US monetary policy. The condemnation was of the bankster, and not the lowly trashman.I’m sorry you are to dim-witted to get it, but thanks for playing anyway.

flash
flash

sheesh….can any of these newbie fucktard read?

Bob -Garbage Tippers, as they may be called, are not paid minimum wage. They are making $10, $11, $12-$15+ per hour, depending on location.

flash- to haul our refuse to the dump for whats most likely minimum wage or* not much more.

…got it now Bob?

Homer
Homer

After perusing the comments, I can add that I know people who work in the service industry and rely on tips to augment their income and that, one, the tips are fewer and, two, the the tips are less. People are spending on themselves to feel better and are less generous. Keeping money for themselves because they sense somethings not quite right.

This doesn’t bode well for the economy. All the really meaningful and important metrics are down across the board.

It is well known that people will strive to maintain their standard of living in a shrinking economy. This is why wives work today where they once were stay at home moms just several decades ago. Forget that fem lib crap that women are now liberated to go into the workforce in competition with men which increases supply of labor and lowers the amount of pay. More taxpayers, a win win for corporations and Government. Soon, they will be liberated into fighting the fourth world war right along with the boys.

Calling women liberated so they can work and go to war is like putting lipstick on a pig. No matter how you paint it, it’s still ugly.

There was a time when women raised the kids and the men went off to war, ah, but that’s so antiquated. Women don’t realize what they have lost.

Just think in a few more years these will be the ‘good ole days’.

Homer
Homer

About a month ago, I wrote that the FED rate increase would be 25 to 50 basis points (1/4 to 1/2%). First the rate increase then the deluge (carnage). Today the stockmarket DOW is down to 15,988 from the 17,000’s and many are saying it is going lower, much lower. Most people don’t know a Dow from a Cow, but sense a foreboding despite the cheer leading from the MSM. Bad news, more than good news, is contagious. Fear is a great motivator, but more often than not it leads to confused, reactive responses. Knowledge quenches fear and gives you a more reasoned approach.

However, what passes as knowledge, today, for the general public, is the latest spiel from the MSM.
People would rather not know because knowing does great damage to the person’s belief structure, so real knowledge most often is met with denial.

I’m reminded of a story. A person was describing to a Texas cowboy, in a saloon, a giraffe. “it has an 8′ neck and a 4′ body, it has horns between it’s ears, the front legs are longer than the hind legs, it’s 16′ tall, yellow with brown spots all over.” The cowboy eyed him for a minute and declared, quite loudly, “There ain’t no such animal”.

In the end of 2014, Clive Maud, I believe, said that the planned scenario would be, 1) a collapse of the commodity market, 2) a collapse of the stockmarket. The money would flow from commodities to stocks and from stocks to the bond market. The reason is to support the bond market.

When I read this, it rang a bell, hell, it rang the ‘Bells of St, Mary’s’. It made complete sense to me.
The bond market is far larger than the stockmarket and hugely larger than the commodity market. Perhaps, the FED could sell it balance sheet into a rising bond market.

Well, we have had a commodity collapse and are now experiencing a stockmarket collapse. I think we are on schedule. Hmmmm, how will it end, you ask? I think that a lot of people are going to be left holding a lot of gilt covered paper, signifying nothing or we might just have a nice war.

Homer
Homer

I’m reminded of a kid whose father was a ‘trash hauler’ during the depression. He said, “We were never short of toys.”

SpecOpsAlpha
SpecOpsAlpha

Sell everything except gold and silver coins. Switch 401-k type money to gold mining stocks (50%) and US Treasury Money Market funds (50%).

Fourth Turning going ballz in.

wolfy
wolfy

This news cycle does make me want a cold one.

Homer
Homer

SpecOpsAlpha says, “Sell everything…”

Head for the hills. The end is near. Hide your women and children. The Huns are at the gate.

SpecOpsAlpha, I don’t think anyone is listening, but that will change.

Opportunity comes only once for most folks, but to the knowledgeable it’s a repeat performance.

SpecOpsAlpha
SpecOpsAlpha

Homer,
I think it was the book ‘Night’ by Eli Weisel where the town crazy keeps telling the Jews in the town to run, run you dumb fukkers but they laugh at him. “One day soon the Germans will come and round you up!” The Jews laughed. Of course, soon they were rounded up and most died in Treblinka.

Buy mining stocks and Treasury money market funds for IF the system holds together.

Buy coins, ammo, MREs and supplies like these for if it does NOT.

robert h siddell jr
robert h siddell jr

Your walk through of the crash didn’t go far enough. Bonds just take longer to crash; then PMs zoom up and crash, then food goes sky high, then humanity crashes. .

Stukfuk
Stukfuk

Hehehe, he said stukfuk.

Ghost

One of my cousins’ hillbilly neighbors’ was laid off from his job just after the New Year and this past Saturday, he and his rather large-bellied wife joined my cousins’ football playoff party. I’d met them briefly at other functions, but had never had the pleasure of seeing them both shitfaced drunk.

However, my gift to each of my two cousins for Christmas was a bottle of Patron tequila and the hostess had decided to chill the bottle and serve it with chunks of lime, rock salt and pretty little shot glasses. When large belly saw the Patron, she said “Hello! Who won the lottery?” and she pulled the plug, took a long swig off the bottle and plopped her big ass down at the counter with the bottle in front of her, as if she’d claimed her door prize early. Within a half hour, I knew more about her than I ever want to know about another lazy fat hillbilly again.

At one point, she did ask me if I was rich or something to buy that Patron and I said that my husband was retired military and so I could purchase liquor at the Class VI store at the army base not too far from my son’s college. Immediately, she announced that she and her husband would be sending money with me next trip to buy them a pallet of cheap vodka, since he’d lost his job and they needed to stock up.

That warmed the cockles of my heart… knowing I could help someone out when they are down.

Archie

Admin, this got picked up by Bill Murphy at the metropole cafe. I used to subscribe there. They are well meaning people, if monstrously wrong about PM price movement. Congrats and get well.

IGOR
IGOR

A couple of years ago, I stopped in Applebee’s in Bridgewater after completing some work.
There was a guy sitting next to me that looked like Jerry Garcia and we started talking.

He said for 7 years he worked in men’s clothing in Macy’s and hated it. Everyday putting on a suit and tie and worrying about the pressure of working on commission. He said a guy he knew told him there would so be a job opening where he worked.

That was 8 years before and he started working for the county picking up road kill. The money
was decent, good benefits and for the first time in his life he was happy.

I think there are more subversive happy collectors of trash and dead animals out there than we realize.

KaD
KaD

Forty percent of Americans who are capable of working but who don’t have a job say they have completely given up looking for work, according to a new report.

More than half – 55 percent – of those out of work for more than two years say they have given up, while 21 percent of those out of labor force for three months or less say the same.

“Sometimes people get so frustrated with their job prospects that they give up looking for work altogether,” states the report. “If they’re not looking for work, then they’re not officially counted among the ‘unemployed’ according to the government.”

http://freebeacon.com/issues/americans-giving-up-on-jobs/

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