#1 When the economy is in
good shape, holiday spending increases each year.
In 2024,
only 16 percent of Americans say that they are going to
spend more than last year and
35 percent of Americans say that they are going to spend
less...
Americans this holiday season say they
are seeing a ghost of Christmas past: inflation.
The CNBC All-America Economic Survey
finds inflation is still haunting the buying public, leading
to what's shaping up to be just an average season for
retailers.
Just 16% of respondents say they will
spend more, down two points compared to last year.
Forty-eight percent said that they'll
lay out the same amount for holiday gifts, up five
points.
At the same time, 35% say they'll
spend less, down two points as well.
#2 The number of job
openings in the U.S. is now
the lowest it has been since January 2021, but unlike
January 2021 we don't have a pandemic to blame our poor
performance on...
US job openings tumbled last month to
their lowest level since January 2021, a sign that the labor
market is losing some momentum.
Still, posted vacancies remain well above
pre-pandemic levels.
The Labor Department reported Tuesday
that the number of job openings dropped to 7.4 million in
September from 7.9 million in August.
Economists had expected the level of
openings to be virtually unchanged. Job openings fell in
particular at healthcare companies and at government
agencies at the federal, state and local levels.
#3 The manufacturing numbers
that we are getting are extremely dismal.
For example, the Philadelphia Federal Reserve
Manufacturing Index just experienced
an extremely sharp decline...
The Philadelphia Federal Reserve
Manufacturing Index, a critical gauge of the general
business conditions in Philadelphia, has reported a
significant drop.
The actual figure stands at -16.4, a
sharp decline that suggests worsening conditions for
manufacturers in the region.
This figure starkly contrasts with the
forecasted number of 2.9, highlighting a more severe
downturn than initially predicted.
Analysts had anticipated a positive
shift, indicating improving conditions, but the actual data
presents a different, more concerning situation.
Moreover, when compared to the previous
index value of -5.5, the current reading of -16.4 further
emphasizes the severity of the decline.
This continuous drop indicates a
concerning trend for manufacturers within the Philadelphia
Federal Reserve district.
#4 Thanks to rapidly rising
mortgage rates, the average U.S. homebuyer just lost
$33,250 in purchasing power in just six weeks...
Mortgage rates hit 7% on October 28, the
highest level since the start of summer and up nearly one
percentage point from the 18-month low they dropped to in
mid-September.
A homebuyer on a $3,000 monthly budget
can afford a $442,500 home with a 7% mortgage rate, the
daily average 30-year fixed rate on October 28.
That buyer has lost $33,250 in purchasing
power over the last six weeks; they could have purchased a
$475,750 home with the 6.11% average rate on September 17.
That was the lowest level since February
2023.
#5 Our cost of living crisis
is officially out of control.
According
to Bank of America, almost a third of all households,
"spend more than 95% of their
disposable income on necessities such as housing costs,
groceries and utility bills"...
Many Americans are still in a tough spot:
Nearly 30% of all US households this
year said they spend more than 95% of their disposable
income on necessities such as housing costs, groceries
and utility bills, according to a Bank of America
Institute report, up from 2019 levels.
#6 A recent Lending Tree
survey discovered that nearly a quarter of all households
couldn't pay their entire power bill at some point within
the past year...
LendingTree's findings about electricity
bill costs comes as it reported 23.4% of Americans
experienced an inability to cover their entire energy bill
or portions of it in the last year, based on Census Bureau
Household Pulse Survey data.
#7 The same Lending Tree
survey found that about a third of all households had to reduce
spending "on
necessary things" within the past year in order to pay
utility costs...
Needing to cover utility bills prompted
34.3% of Americans to curb their spending on necessary
things - or eliminate some altogether - in at least one
instance in the prior year, LendingTree said.
#8 As I discussed last
week, demand is at record levels at food banks all over the
nation...
Why is demand at food banks all over the
country higher than it has ever been before?
The media keeps insisting that economic
conditions are just fine, but it has become
quite obvious to everyone that this is not true.
In particular, the
rising cost of living has been absolutely crushing
households from coast to coast. In the old days, most of
the people that would show up at food banks were unemployed.
But now food banks are serving large
numbers of people that actually do have jobs but that don't
make enough to pay for all of the basics.
The ranks of the "working poor" are
growing very rapidly, and this is creating an unprecedented
crisis all over America.
#9 During normal times,
troubled retailers would at least wait until after the holiday
season to throw in the towel.
But we haven't even reached Christmas and
Party City
has already announced that it will be closing all stores...
Party City is closing down all of its
stores, ending nearly 40 years in business, CNN has learned.
CEO Barry Litwin told corporate employees
Friday in a meeting viewed by CNN that Party City is
"winding down" operations immediately and that today will be
their last day of employment.
Staff were told they will not receive
severance pay, and they were told their benefits would end
as the company goes out of business.
#10 Not to be outdone, Big
Lots has announced that
all 936 of their remaining stores will be shutting down on a
permanent basis...
Big Lots is beginning 'going out of
business' sales at all its stores across the US, as it
prepares to close its remaining locations.
The discount retail chain filed for
Chapter 11 bankruptcy in September, and has already shut
hundreds of stores nationwide.
In a press release Thursday, the company
said it would begin the sales at its 963 remaining
locations, after a sale to a private equity firm fell
through.
#11 As of the end of
November,
more than 7,000 store closings had been announced in the
United States.
That is a 69 percent increase from last
year...
According to a report from CoreSight
Research, U.S. retailers had announced more than 7,100 store
closures through the end of November 2024, which represents
a 69% increase compared to the same time in 2023.
These closures are spread across numerous
different sectors of retail from auto parts to restaurants
to pharmacies, leaving many consumers wondering which
companies will survive.
This brings us to GameStop, the beloved
retail gaming store, which has not only been closing
hundreds of retail store locations since 2020, but also
appears to be on track to close hundreds more of its
locations in the very near future.
