mys·ter·y1 Pronunciation Key (mst-r)

One whose identity is unknown and who arouses curiosity.

 

 

 

 
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« As Merrill goes . . . | Main | Rough road »

Retail Tell-Tale

If consumers account for two-thirds of the U.S. gross domestic product, as generally reported, the prospects for continued economic weakness look very real – and maybe even that other R word, recessionary – when you look at share prices of major retail stocks recently.

Banks and building and some other sectors of the stock market haven’t done so well lately either, but the showing of the major big-box retailers seems especially ominous after another rough day Friday considering the clout consumer spending is supposed to have on the economy. Perhaps it’s the higher prices for energy or food or the tightening credit market or the loss of jobs or some other factor that’s finally catching up with consumers. Look at what’s happening to the value of these stocks:

 Kohl’s (KSS), which closed at 47.58 Friday, hasn’t been below 50 since the spring of 2006.
 Target (TGT), which closed at 56.19, is also at its lowest level since 2006 after a July high above 70.
 Sears Holdings (SHLD) sank Friday to 120.87, also its lowest level since 2006.
 Home Depot (HD) has fallen to its lowest level since 2003.
 Wal Mart Stores (WMT) is threatening to drop below 42 to its lowest price since 1999 – now that’s rolling back prices, as their television ads tout.
 Even Nordstrom (JWN), at the other end of the economic spectrum from Wal Mart, has seen its shares fall from near 60 early this year to about half that, going back to lows from mid-2005.

There may be a variety of reasons to explain the setbacks in these stocks, but we are now at the most critical season of the year for most of these retailers. If consumers don’t step up . . . well, let’s just say it could be a pretty bleak holiday for stock index bulls.

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About Me:

Almost nothing is known about the Mystery Trader. If there were anything much known, he or she would not be such a mystery, would he or she?

We can say only this: the Mystery Trader has been trading for a long time, has learned a few things, mostly the hard way, has traded all kinds of crazy financial instruments, has made AND LOST an awful lot of money, and has not died broke well, not YET anyhow, but there is still time for that.

The Mystery Trader writes these impressions and thoughts as a kind of an uncensored stream of consciousness journal or diary, largely for his or her own amusement, but also hoping these thoughts might help readers somehow, perhaps occasionally, prevent them from doing something stupid.

The Mystery Trader hopes that his or her thoughts might help YOU keep from losing YOUR shirt in the world's biggest casino. The financial markets are notoriously tricky and have ALWAYS been loaded with disinformation, deception, raw deals, chicanery, and outright criminal theft. Unfortunately, little of this bad behavior is caught and punished because the financial markets are too big and chaotic.

The Mystery Trader certainly and explicitly does NOT recommend that you blindly accept any ideas presented here or take anything expressed here at face value as actual fact. On the contrary, if anything, the Mystery Trader hopes that this blog might encourage you to think entirely for yourself and develop your own UNcommon sense. Be careful, have fun, and good luck!

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