{"id":2003,"date":"2023-11-21T11:31:28","date_gmt":"2023-11-21T11:31:28","guid":{"rendered":"https:\/\/economicherald.net\/?p=2003"},"modified":"2023-11-21T11:31:28","modified_gmt":"2023-11-21T11:31:28","slug":"free-whelan-thanks-america-for-giving-us-all-the-us-consumer","status":"publish","type":"post","link":"https:\/\/economicherald.net\/?p=2003","title":{"rendered":"FREE WHELAN: Thanks America, for giving us all the US Consumer"},"content":{"rendered":"<p>In this Stockhead series, investment manager James Whelan, managing director Barclay Pearce Capital Asset Management offers his insights on the key investment themes and trends in domestic and global markets. From macro musings to the metaverse and everything in between, Whelan offers his distilled thoughts on the hot topic of the day, week, month or year, from the point of view of a professional money manager.<\/p>\n<p>\u00a0<\/p>\n<p>Good morning,<\/p>\n<p>And so, bleary-eyed yet stoic, the nation lurches along the final stretch of the year safe in the knowledge that we really do have the best cricket team in the world.*<\/p>\n<p><em>(*Ed: What was the Airport Economist\u2019s forecast for The World Cup?)<\/em><\/p>\n<p><em>Via X and Tim Harcourt<\/em><br \/>\n\u00a0<\/p>\n<h2>In far more urgent news\u2026<\/h2>\n<p>I have started the countdown for my annual Whelan Vs Thanksgiving Lunch on Sunday.<\/p>\n<p>Sadly, however, I\u2019ve now become that desperate foodie\/fundie far too busy to try a new recipe.<\/p>\n<p>So, I\u2019m going to go ahead and repeat last year\u2019s apricot jam glaze\u2026 but I have a lot to be thankful for and that\u2019s what really matters.<\/p>\n<p>Also \u2013 I envisage \u2013 a few Coors in the sunshine with the college football blaring on the big screen. The ideal way to pay respects to the largest economy on Earth.<br \/>\n\u00a0<\/p>\n<h2>Speaking of Thanksgiving\u2026<\/h2>\n<p>And when it come to the largest economy on Earth we have full focus on the US consumer, that most precious yet powerful beast.<\/p>\n<p>Retail earnings has been\u2026 choppy. Retail sales were down 0.1% last month, although that was less than the 0.3% expected, it\u2019s still a fall.<\/p>\n<p>We saw Home Depot (HD) report earnings \u2013 and wasn\u2019t it amazing re: what Americans aren\u2019t spending money on?<\/p>\n<p><em>Via FT<\/em><\/p>\n<p>\u00a0<\/p>\n<p>This is all touched on in the latest episode of the <a href=\"https:\/\/shows.acast.com\/5ed1b0e5769354130c73bb32\/6556afb65c5f6900122c6718\">Theory of Thing Podcast<\/a>,<\/p>\n<p>The most important question for ~60% of US GDP (and therefore 15% of global GDP) is \u201chow long does the US consumer keep going?\u201d<\/p>\n<p><em><strong>From the same FT article\u2026<\/strong><\/em><\/p>\n<p>\u201cNow, though, with the labour market cooling more notably, wage growth moderating, and savings stockpiled since the pandemic beginning to run out, the question dogging officials is how long can the US consumer retain this resilience?\u201d<br \/>\n\u00a0<\/p>\n<h2>Some notes from the US banks on the Ultimate Consumer\u2026<\/h2>\n<p><em>Goldman Sachs\u2019 Scott Feiler, consumer sector specialist.<\/em><\/p>\n<p>Notes that retail sales did fall in October.<br \/>\nThey see a slowdown but not a disaster. The consumer is \u201cstretched\u201d but somewhat resilient.<br \/>\nBig ticket items (autos and home related goods) are getting hit.<br \/>\nServices is below Covid but catching up and catching up strong.<br \/>\nRV\u2019s and \u201cpower sports\u201d (jetskis I guess) will remain challenged.<br \/>\nSmall ticket stuff will remain okay, apparel etc.<\/p>\n<p>\u00a0<\/p>\n<h2>Black Friday<\/h2>\n<p>Black Friday is Friday after Thanksgiving. Event based shopping is still strong. Shoulders around those events are not.<\/p>\n<p>Small ticket electronics.<\/p>\n<p>XRT has its best month in November.<\/p>\n<p>How does it translate to earnings? Topline is missing by a few per cent but bottom line is still resilient through margin defence.<\/p>\n<p><em>Helen Zentner- Morgan Stanley chief US economist<\/em><\/p>\n<p>Cooling spending (obviously)<br \/>\nBusiness investment &amp; equipment will return in back half of 2024<br \/>\nExisting home sales rise as cuts hit in back half 2024<br \/>\nCore goods in the CPI will be negative next month<br \/>\nFed is done.<\/p>\n<p>\n<em>\u201cFed is done..noted\u201d<\/em><br \/>\n\u00a0<\/p>\n<h2>Ok, back to Jimmy James\u2026<\/h2>\n<p>What can we pull from all this?<\/p>\n<p>Firstly, that the US consumer is still doing what it does, just smaller. Walmart also said that transactions over $1000 were down 5.2% year on year.<\/p>\n<p>It\u2019s all in line with the soft landing thesis now seen as the norm.<\/p>\n<p>Companies are surviving it all fine because although spending is less, companies have been able to keep their margins throughout via lowered input costs and freed up supply chains.<\/p>\n<p>Also note that Boomers are carrying the ball with increased spending while \u201cthe young\u2019ns\u201d have cut back. Similar to Oz.<br \/>\n\u00a0<\/p>\n<h2>Bottom line..bullish.<\/h2>\n<p><em>Eddy: Bullish\u2026noted.<\/em><\/p>\n<p>\u00a0<\/p>\n<p>So how about that XRT ETF in the States? It\u2019s mostly apparel and does well in November.<br \/>\n\u00a0<\/p>\n<h2>It too looks bullish\u2026<\/h2>\n<p>Via Trading View<\/p>\n<p>Happy to participate. Stay long.<\/p>\n<p>All the best and well done to the Aussies!<\/p>\n<p>James<\/p>\n<p><em>The views, information, or opinions expressed in the interview in this article are solely those of the writer and do not represent the views of Stockhead.<\/em><\/p>\n<p><em>Stockhead has not provided, endorsed or otherwise assumed responsibility for any financial product advice contained in this article.<\/em><\/p>\n<p><span class=\"et_bloom_bottom_trigger\"><\/span><\/p>\n<p>The post <a href=\"https:\/\/stockhead.com.au\/experts\/free-whelan-thanks-america-for-giving-us-all-the-us-consumer\/\">FREE WHELAN: Thanks America, for giving us all the US Consumer<\/a> appeared first on <a href=\"https:\/\/stockhead.com.au\/\">Stockhead<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"<p>In this Stockhead series, investment manager James Whelan, managing director Barclay Pearce Capital Asset Management offers his insights on the key investment themes and trends <a href=\"https:\/\/economicherald.net\/?p=2003\" class=\"read-more-link\">[more&#8230;]<\/a><\/p>\n","protected":false},"author":0,"featured_media":2004,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-2003","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.7 - 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