If retail got its big inventory correction over with the last 18 months (as many say they have) then I would expect fewer “deals” and motivated sellers. Buyers will be hunting for deals and be very price sensitive but many retailers will have contracted sufficiently where they won’t be offering what the buyers are looking for. I think this is a possible scenario for Xmas season.
Rosenberg said something similiar as well:
“And, a companion survey by the NPD group shows that over 60% of shoppers only intend to buy marked-down items, which only complicates the sales outlook that much more because merchants believed they have adjusted their inventory levels sufficiently to avoid another round of price cutting.”
The combination of the stock market rebound, less shaky financial system than we were seeing last December and many people not paying their mortgage (for most, their biggest expense) might be enough to goose sales YoY. But I tend to believe the inventory correction story combined with credit card cutting/contraction along with the general economy will win out. Though as many will point out history is littered with piles of people predicting the death of the American consumer. The ability for people to spend in the face of reality is really a defining characteristic of the american consumer.
