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Global Economy Bursting?

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We are being OBE - overtaken by events - Office Max and Office Depot are merging

It seems the niche stores (Cabelas, Academy Sports, etc) are doing OK but you wonder if a few years (say 15?) from now they will be following the path of Circuit City and Best Buy...going down hill.

The first "office" store we had was Reliable and they folded. I ordered a lot on line or by fax from Viking but Office Depot bought them out. Then we got 3 Off. Depots, a Staples and an Office Max....I predict that we'll be down to 2 Office Depots and a Staples soon. It is too easy to buy on line.

I just purchased a new camera body for my DSLR - Why not? The local camera store wanted to sell me a Nikon for $800. I found it on line for under $500. But I have a Pentax and so after a lot of searching I found one for $577. My lens fits it, which is the reason I didn't switch to Nikon. I would have to buy new lenses, filters, etc.

There are going to be a lot of success stories and a lot of failures. I think it was pretty much always that way. Montgomery Wards and Sears were in the total catbird's seat to have created the kind of store that Amazon became. Why not? They had the products. They had the price (for their time.) and all they needed was to change with the times and actually get "on line" and sell something. And no one has bested Amazon's model....yet.
 
Wall Street slides as Fed minutes spark concern

http://www.reuters.com/article/2013/02/20/us-markets-stocks-idUSBRE91I00T20130220

Stocks fell the most in three months and a key gauge of market volatility spiked on Wednesday after minutes from the U.S. Federal Reserve's most recent meeting suggested the central bank may slow or stop buying bonds sooner than expected.

The minutes from the Fed's January meeting showed many officials voiced concern last month over potential costs of more asset purchases, suggesting that the program, known as QE, may slow before the pickup in hiring it was intended to deliver.

"What Wall Street wants to hear is an absolute sign that the Fed will continue with QE for the indefinite future. When it says we may end it faster, that just raises the uncertainty, and the market hates that," said Todd Schoenberger, managing partner at LandColt Capital in New York.
 
Randolph Kinney said:
Since the "Unaffordable Care Act" defines full-time employment at 30 hours, many businesses are cutting back the number of hours employees can work to 25. In turn, this led to more hiring, all part-time jobs of course. Some medium-sized businesses reduced employment to under 50 workers and other businesses turned to consultants to get around the act.

Now businesses are investigating opting out of the plan even for full-time employees.

Labor unions that pushed Obamacare through want out

http://www.washingtontimes.com/news/2013/feb/17/clancy-labor-unions-pushed-obamacare-through-want-/

Who knew Obamacare was bad for workers? Unions, or rather the professional class of union leaders, were vehement supporters of Obamacare’s federal takeover of health care. Now that they’ve had a chance to actually read the 2,801-page bill and “find out what is in it,” they are upset and want out.

Major unions like the AFL-CIO and the Teamsters are now demanding that they be allowed to stay on their current health care plans and receive government subsidies to cover the increased costs some of Obamacare’s provisions will impose on lower-income workers. They want to eat their government cake and have it too. What else is new? Who would foot the bill? You guessed it: We, the taxpayers.

The rank hypocrisy of Obamacare-backing unions began almost immediately after the passage of the bill three years ago, with hundreds of thousands of union workers being exempted from the law through waivers from the Obama administration.

In total, more than 1,200 entities were granted waivers from President Obama‘s signature legislation, the vast majority of them labor unions. In fact, unions representing 543,812 workers received waivers, while only 69,813 employees at private firms, many of them small businesses, managed to secure a waiver.

Readers will recall Mr. Obama’s constant mantra: “If you like your health care, you can keep it.” Not so. According to the Congressional Budget Office, more than 7 million Americans will lose their employer-based insurance thanks to Obamacare. Unintended consequences always come back to haunt us, and try though they might, government actors are incapable of overturning economic law by mere decree.

Instead of joining the majority of Americans who want this bill repealed, unions are seeking to use their political leverage to shield themselves from the harm Obamacare will impose on hundreds of millions of their fellow Americans.
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Obamacare is the greatest thing ever! :rof:
Universal Orlando plans to stop offering medical insurance to part-time employees beginning next year, a move the resort says has been forced by the federal government's health-care overhaul.
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Randolph Kinney said:
Retail Apocalypse: Why Are Major Retail Chains All Over America Collapsing?

[url]http://investmentwatchblog.com/retail-apocalypse-why-are-major-retail-chains-all-over-america-collapsing-sears-j-c-penney-best-buy-and-radioshack-are-all-going-to-close-hundreds-of-stores-before-the-end-of-2013/[/URL]

A recent internal Wal-Mart memo that was leaked to Bloomberg described February sales as a “total disaster”. So why is this happening? Why are major retail chains all over America collapsing? Is the “retail apocalypse” upon us? Well, the truth is that this is just another sign that the U.S. economy is falling apart right in front of our eyes. Incomes are declining, taxes are going up, government dependence is at an all-time high, and according to the Bureau of Labor Statistics the percentage of the U.S. labor force that is employed has been steadily falling since 2006. The top 10% of all income earners in the U.S. are still doing very well, but most U.S. consumers are either flat broke or are drowning in debt. The large disposable incomes that the big retail chains have depended upon in the past simply are not there anymore. So retail chains all over the United States are now closing up unprofitable stores. This is especially true in low income areas.

When you step back and take a look at the bigger picture, the rapid decline of some of our largest retail chains really is stunning.

It is happening already in some areas, but soon half empty malls and boarded up storefronts will litter the landscapes of cities all over America.

Just check out some of these store closing numbers for 2013. These numbers are from a recent Yahoo Finance article …

Best Buy

Forecast store closings: 200 to 250

Sears Holding Corp.

Forecast store closings: Kmart 175 to 225, Sears 100 to 125

J.C. Penney

Forecast store closings: 300 to 350

Office Depot

Forecast store closings: 125 to 150

Barnes & Noble

Forecast store closings: 190 to 240, per company comments

Gamestop

Forecast store closings: 500 to 600

OfficeMax

Forecast store closings: 150 to 175

RadioShack

Forecast store closings: 450 to 550


But the truth is that those store closings are not the entire story. When you dig deeper you find a lot more retailers that are in trouble.

For example, Blockbuster recently announced that this year they will be closing about 300 stores and eliminating about 3,000 jobs.

Toy manufacturer Hasbro recently announced that they will be reducing the size of their workforce by about 10 percent.

Even Wal-Mart is going through a tough stretch right now. According to documents that were leaked to Bloomberg, Wal-Mart is having an absolutely disastrous February.
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http://www.huffingtonpost.com/james-howard-kunstler/chain-stores-economy_b_2720040.html
"The presence of K-Mart, Tractor Supply, and Radio Shack a quarter mile west in the strip mall would seem to mock their dim inklings that something is in the wind. But K-Mart will close over 200 boxes this year, and Radio Shack is committed to shutter around 500 stores. They could be gone in this town well before Santa Claus starts checking his lists. If they go down, opportunities will blossom. There will be no new chain store brands to replace the dying ones. That phase of our history is over.
What we're on the brink of is scale implosion. Everything gigantic in American life is about to get smaller or die. Everything that we do to support economic activities at gigantic scale is going to hamper our journey into the new reality. The campaign to sustain the unsustainable, which is the official policy of U.S. leadership, will only produce deeper whirls of entropy."


Back to local. Can't wait.
 
Things, Themes, Memes, Fads, grow, and then they die.
This is not the end of retail, it's more likely the end of the BigBox stores.
I for one am glad to see giant warehouses like Home Depot & such die off.

Leaves things open again for specialist stores; there used to be several Stereo -- Hi-Fi stores near me back in the 70s & 80's then they were crippled by BestBuy & CircuitCity - and died off.
But they had better merchandise, more knowledgeable salespeople, & nicer environment than the "SuperStores".
Prices - they were a little higher but you could haggle with them, or wait for sales.
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The Bigbox thrived in part due to a lack of customer service in the smaller "niche" stores. Once you realized you were on your own in Stereo Oreo then what was the downside to buying at Best Buy...which led to the realization you can buy on line even easier.

I shopped for a camera to replace my aging DSLR. I had 3 lenses so I stuck with the same Pentax brand. Our local store sells Canon and Nikon. I could get a better price for a Nikon but would have only the lens that came with it. I read the reviews and decided it was the right choice for me to pay a little more for a new Pentax body than it would cost to buy the equivalent Nikon...both were well rated on reviews. Both have lots of features. But could I learn anymore from that personal experience in a photo store? Nope. No Pentax dealer around that was knowledgeable anyway.

The camera has proven to be all I expected of it. Something you might not be so sure of if you depended upon those small stores or big boxes either.

WalMart, among others, is realizing they are losing customers to smaller stores like Dollar General. The reason I hate shopping Walmart is if I want one item it might take 30 minutes to find it and get out. And if I have several common items, I am liable to walk for an hour to find each one. I need the exercise but that is not the way I want to get it.
 
Something that showed up in my mailbox today



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How economics became the hijacked science

http://blogs.reuters.com/breakingviews/2013/02/22/review-how-economics-became-the-hijacked-science/

Haering and Douglas also argue the measures of economic success are biased. A meticulous investigation into the way the United States calculates its Gross Domestic Product shows that the official measure is overstated. A notable example is the biased estimate of quality improvements, which lowers reported inflation rates and increases real GDP. The book cites academic research estimating that this “quality inflation” explains about 20 percent of the reported gap between American and European productivity.
 
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