The weekly jobless claims have been reported and the number for this week is 351K, continuing claims 2.831 Million. While the weekly number dropped a small amount with respect to last week, the continuing claims data continues to grow. Continuing claims is what is looked at for signs of the total employment levels of the United States. The market is viewing this data negatively as the employment situation is not showing any signs of improvement.
Monthly same-store sales data has been rolling in this morning from many of the retailers in the US. If you only listen to the media you would take away that things are improving. But for those of us that are "thinking" analysts we see things differently. The trend is showing us that higher end retail stores are suffering more than the discount chains. Wal-Mart (WMT) reported a February same-store sales value of +2.6%. Now remember that these numbers are always relative, not an absolute. Sales relative to the previous month may have increased but it is far lower than previous revenues and sales. Be that as it may we see Wal-Marts increase as the sign that more of the middle class are shopping at the discount stores, such as Wal-Mart as the cost of living continues to increase. The more prestigious names are showing generally flat to even worse sales data. JC Penny (JCP) and Nordstrom (JWN) are examples of higher end retail stores that are declining. And Macy’s (M) has decided to stop reporting sales data altogether which is highly unusual in the retail business. The consumer is still contracting and is shopping more at discount chains over the higher luxury stores.
Credit markets are under more stress this morning.
THE WSJ IS REPORTING THAT THE CARLYLE CAPITAL UNIT HAS RECEIVED A NOTICE OF DEFAULT FROM ONE OF THE BANKS THAT HELPS FINANCE ITS PORTFOLIO OF FREDDIE MAC AND FANNIE MAE SECURITIES THROUGH SHORT-TERM REPURCHASE AGREEMENTS.
The European Central Bank and the Bank of England left their interest rates unchanged. The Europeans are smart, they see the risks of inflation while our Federal Reserve continues to rub dirt into an open wound.
