Over 50% of holiday shoppers are wandering through malls baiting retailers. They are saying "We are here, but we ain’t buying yet."
Reuters writes that consumer-behavior marketing firm America’s Research Group found that "Half of America went shopping this weekend but they weren’t very serious about it." They are waiting for another wave of price cuts as stores bring down price tags to keep inventory from being high after Christmas.
The consumer is obviously not dead. He still has money in his pocket. Housing problems and fuel costs have not driven him out of the market.
E-commerce sales are running up about 25% this season and store traffic is at least modest. But,margins at retailers are going to be squeezed and squeezed hard if the shopper wants to play a game of chicken. At the end of the day, the buyer always wins. He can simply wait until early next year.
Shares of Sears (SHLD) and Wal-Mart (WMT) have not seen their bottom. Gross margins won’t be good in Q4
Douglas A. McIntyre
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