
Early data shows strong Black Friday - gibsonf1
http://biz.yahoo.com/ap/081129/holiday_shopping.html?.v=3
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albertni
Sales were up, but what about profits? Retailers cut costs like never before,
and while sales are up, if you have an item that costs $4 to make and sell
five of them at $5 a pop, sales are up but profits are down relative to
selling four items at $6, as long as you can still sell the fifth later. And I
guess that's the key this year - can retailers sell more after Black Friday,
or will it represent an abnormally large percentage of holiday season
spending?

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ojbyrne
In my opinion, the financial crisis is (hopefully/mostly/maybe) over, and this
is now a consumer-led problem, led by people who are scared about losing their
job. But those who still have jobs have noticed that declining interest rates
and declining gas prices have given them more money than they had 3 months
ago, and are cautiously spending some. The near-constant drum beat of
pessimism seems to be the main headwind.

I speak from personal experience here, I'm in an area where I could lose my
job if we all stop spending, but it hasn't happened yet. But I'm making the
best money of my life.

And the Dow has a five-day winning streak (thank goodness for small good
things) and suddenly there's a good retail report from the US. Let's dream of
good things.

~~~
DenisM

      In my opinion, the financial crisis is (hopefully/mostly/maybe) over
    

What data do you base your opinion on? Or is it meant to express your hopes
rather than perception?

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mynameishere
The best stat to go on is here:

<http://www.bloomberg.com/apps/cbuilder?ticker1=.TEDSP:IND>

It gives you a rough idea of the health of the credit markets. TARP actually
helped quite a bit, but it's been inching up over the past few days (up==bad)
at the same time the markets have been going up. "Suckers' market" is what I
think, and yet I made a few conservative purchases. Safe money remains firmly
on the treasuries.

Here's the only thing I know: Nobody knows. The more important the chart is
(like the DJIA) the more it represents prophecy than reality.

~~~
DenisM
Thanks for the chart, I learned something new today.

Looking at the five year chart I wouldn't call today's situation normal. TED
spread is at 2 now and it's been at 4.5 at the peak of the crisis, at 1
throughout last year and at 0.5 before that. Better than worst, but worse than
any other recent time since 1987.

Much of the interbank trust sits on the health of the mortgages, and whether
the worst in there is priced in or not is unclear. I have couple of arguments
towards the worst being still ahead - a) while subprime ARMs are over, option
ARMs have not begun to reset yet[1] b) mortgages issued later in the bubble
were of lower quality than early mortgages(accroding to my common sense) c)
it's unclear when synthetic mortgages come due - it's possible that they have
already fallen apart (hence the acute crisis of trust) or they might be the
last shoe to drop.

And treasuries are only secure if dollar is secure. The recen run-up in dollar
has no fundamnetals behind it other than delveraging, so once that's over it's
bound to tank pulverising the real wealth stored in the treasuries. It's a fun
time - I can't think of _any_ safe assets right now.

[1] see chart in here: <http://www.marketoracle.co.uk/Article5047.html>

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DenisM
People got their HELOCs taken away and their credit card limits slashed and
shopping is still up. Makes no sense...

~~~
gibsonf1
I'm afraid the real hit to many Americans will happen right before Christmas -
the standard time when companies lay off. And I'm thinking that there may be a
lot of layoffs this season, unfortunately.

