The economy is back, Jack! The dead malls and skittish buyers afraid to spend their money due to the economic downturn of just a years ago has reversed itself. Unemployment is down at record levels for Americans thanks to President Trump’s tax and regulation cuts. You can say what you want about the guy, but he has shown he knows how to get the economy going.
Even though not everyone is happy at this point, tariffs still threaten several industries. The average American is taking advantage of the current economic climate. They are spending money again, which is good news for the retail stores. 2/3 of our entire economy is spending via retail, so if you want a good indication at how we’re doing, just look at their health.
According to the Commerce Department, American spending was up 4% for the second quarter, with the early summer months showing significantly strong signs as well. Those reports will be coming out soon.
The next big hurdle to jump through to seal the deal on an amazing year of spending is predicting how the holiday season will shape up. As we edge into September, the spending blitz between Halloween and Christmas holidays is about to begin. Despite the big year so far, higher inflation could dampen holiday sales.
Wages have remained stagnant as prices in nearly every market are climbing higher. Gas, food, and the tariffs impact everything from soft drinks to cars and motorcycles.
A Second Beginning
Despite tempered expectations for the holidays, there is one mega-superstore making a comeback. It’s all due thanks to its new approach to ecommerce. No, we’re not talking about Walmart, but the nearly-defunct Macy’s.
In fact, Macy’s was the second-best performer behind Amazon on the S&P 500 so far this year, their shares up 60%! Shuttering several brick-and-mortar locations seems to be allowing Macy’s to do well.
Walmart also seems to be attempting to challenge Amazon for online supremacy, but has revealed they’re not quite ready to reign supreme. Their digital sales have declined a bit as more Americans do appear to be shopping in-store as of late.
Other stores are competing well with Amazon, as Lowes and Home Depot don’t see much competition with the online retail leader. A lot of this extra money in people’s paychecks have been going towards rebuilding and remodeling their homes…an extravagance they couldn’t afford during the recession.
Most of the Americans who buy things like faucets, wood, paint, and other necessities for fixing things up would still rather go into the store and get it in the moment of need rather than purchasing online and waiting for delivery.
Overall, this is amazing news for every American. The economy is churning, more people have jobs, and the spending craze continues. That is more money getting poured into the economy, which often opens up even more jobs. The cycle continues. Here’s to a great, and profitable, holiday season.