Retail is in change mode
You have probably noticed something if you shop in a retail store. There is no one there to help you!
I walked around the other day in a store trying to find some help and never did find anyone. This is all about the changing retail scene.
If you are an investor, you have noticed the stock prices changing and it most likely has been down. Some retail is doing well, but there is no doubt that Amazon has changed everything.
Some stores will survive and some will not. The “no help” in the stores is all about cost cutting and trying to stay open.
Estimates are that around 4,000 stores will close in 2018. This is a big deal and is changing everything.
It even has a name — “Death by Amazon.”
The good news is that the survivors will be strong and you may even like shopping again. If you are an investor trying to invest in retail you have to look at a company and ask yourself “Are they going to be around in five years?”
The stock markets over the past couple of months have been challenging to say the least. We are down a little through April but nothing catastrophic.
The Trumpster is beginning to wear a little thin with many, so that is unsettling to the markets.
This is nothing but my opinion, but I would be surprised if few, if any, tariffs are put into effect. Like the Donald or hate him, he is right: the mere threat may be enough.
The press continues to not get it, but his supporters want him to do what he is doing. Close the borders, tariffs against unfair competition, and build the wall.
The press likes to rail against Mr. Trump but the reality is it is his supporters who want these changes and he is just following their lead.
I think he uses poor judgment, I hate the tweets, but his people love them.
I voted for him, I supported his campaign but I would prefer he slow down a little. I believe he is good for the markets, just look what has happened so far. He just needs to back off a little in my view.
Through April the Dow Jones Industrial Average was down about 1.5 percent. The Standard and Poor’s 500 was down about 1 percent.
The Nasdaq continues to do well with the FANG stocks still doing well. That market is up over 2 percent. Small caps are doing better, up almost 1 percent.
The Broad Market as measured by the Wilshire 5000 is just about break-even.
I keep telling investors I talk to that these numbers are not bad. We have been on a heck of a run. Many have made a lot of money over the past eight years so to be flat to this point is not a negative in my view.
I like to watch commodities, particularly prices of things we eat as well as energy. Oil is about as high as it was in 2014 so it has been on a run also and here in Pennsylvania gasoline prices are over $3 a gallon most places.
Your chocolate is costing you a lot more. Cocoa futures are up 48 percent.
Wheat is up 16 percent; orange juice, 14 percent; and corn, 10 percent. Lumber keeps on booming because of construction up 37 percent; crude oil, 12 percent; and cotton, 7 percent. Cheaper prices are reflected with sugar down 21 percent; hogs, 15 percent; oats, 7 percent; cattle 6 percent; and gold about even. Coffee, I like to watch is down about 4 percent.
So, what should you be doing here in the markets?
I suggest that the French Riviera would be a good idea. I like to let the summer play out and then as we move into fall get all my guns loaded for the strong part of the year which is typically fall and early spring.
This is a great time to have a review with your money manager and make sure you are both on the same page. Good planning is vital to your success.
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I was in the Man Cave yesterday and had just hung up the phone laughing. The wife wanted to know what was so funny.
I told her my friend Louie had gotten himself in trouble with his wife. Apparently, she came into the bedroom and told him to say some dirty things to her. He said “Bathroom, kitchen, living room.”
She didn’t think that was funny.
Howie Pentony is a Portersville client portfolio manager.
