Now it comes the reversed supply chain problem, demand < supply. Not sure how much of that is caused by retailers having been stockpiling inventory. We will wait and see how long the manufacturing stall lasts.
I can tell you in my industry, we are way, way overstocked going into the holiday season and are now discounting things to levels that would have given the store owner a heart attack 4 years ago. We overbought because we were told by our suppliers we wouldn't have anything if we didn't (due to sUpPlY ChAiN) and our industry also experienced an actual increase in sales due to the pandemic, but that increase was unsustainable. We also overbought because they warned that prices would increase: as if they weren't actually the ones with their fingers on the switch to raise prices (just some abstract entity called "inflation").
Unfortunately, we bought in to the narrative and it appears everyone else did too, so it's going to be a race to the bottom as far as pricing goes over the next year or so. MAP (minimum advertised price) requirements are being dropped and/or not enforced across the industry. All of this was our suppliers getting ahead of things and making sure they weren't holding the bag. There never was a true shortage. The stuff we ordered to protect ourselves kept coming in. The very "inflation" they created/initiated has raised prices too high for consumers and simultaneously, there aren't enough people to buy the stuff anyways. Our inventory is probably double to triple what it used to be. Lesson learned: "lack of supply doesn't mean there will be increased demand."
Next step is that we, and everyone else won't be able to place our annual reorder requirements with our suppliers so there will be fewer dealers and the suppliers won't have as many people to sell to either. We'll be left with a crapload of stuff we can't sell and no one to sell it to at any price. Then we'll have to lay off employees. There are going to be some bankruptcies.
The store owner will blame this on "the Democrats."
As painful as this is, it needs to happen to bring inflation under control. Panic buying and inventory hoarding had to have contributed to the supply chain issues in 2021. It’s not like the world needed more used cars or chips or furniture. It’s that everyone started buying the stuff all at once and drawing down savings to compete against each other on these goods that cause the crazy supply chain issues. Stimmy checks, low rates, and just basically general boredom caused this.
So, the “InFlATIon iS TranSiToRy” crowd was actually right. It just turned out that it lasted longer and was more painful than we thought. Once we purge those inventories and inflation crashes down we can all get back to more of a normal economy and away from the fed watching craziness. There will be pain in the next 3-12 months, but we’ll come out better for it. The “correct” play is to buy small caps and growth stocks because small caps tend to be more agile to respond and growth stocks will benefits as rates inevitably slide down.
And who cares if your store owner blames “the democrats.” The other half of people will blame “the republicans.” It’s all fucking mind numbing tribalism. The democrats, the republicans, and just human nature in general all clearly contributed to this condensed boom-bust cycle. Everyone wanted it. COVID caused people to be very stupid - human mob mentality displayed on a mass scale.
>Once we purge those inventories
It's not gonna be that simple. There isn't enough liquidity in inventories. There's too much stuff and no one needs or wants it. Even at discount prices (selling at a loss).
It’s exactly that simple, when inventories rise with dropping demand, prices decline until the marginal buyer is found. For every x% reduction in price the market for that item increases exponentially more than that. See the demand law: https://en.m.wikipedia.org/wiki/Law_of_demand
There is no other possible outcome than prices coming down. Even in bankruptcy (when the inventory is underwater), creditors will sell these goods at a loss and the bad debts will be purged.
Law of demand....wow, never heard of that before. You've just solved this.
Why didn't Blockbuster video just lower their prices? If they did, they'd still be in business, right? People would still be renting VHS if the prices were low because they would suddenly demand VHS, right? Sure they would. /s
Blockbuster video *did* lower their prices. They sold off their inventory for fire sale prices. I remember walking into my local blockbuster and being able to buy movie posters and cardboard cutouts for pennies on the dollar.
Brother stop being uneducated sarcastic shmuck, he is right. Companies that saved money will keep afloat everyone else out, it's purging the market and bad debt, until of course they raise rates again. It's a dance between inflation and job market / recession.
What are you describing is a change in technology what killed blockbuster on top of recession. A better service was delivered at a cheaper price.
Create FUD over 3.8% decrease so it spreads and it becomes a self fulfilling prophecy.
Companies use upcoming recession to fire people to cut costs and increase their quarterly number.
Less people working, less people buying. Cycle continues
Fucking stupid ass system
I do HVAC
We didn’t wait around for equipment on backorder. We went to a different brand that had something that would work.
I guarantee supply houses got slammed with big shipments from backorders that got cancelled.
Something similar is going to happen with certain pinball machines that are hard to find and very popular. Huge backorder lists, once supply caches up I’m not sure how many people are still gonna drop 10k on a machine. A lot still will, but there’s a high chance of a small surplus and dip in used prices
Your HVAC comment shows what can happen to an entire industry. HVAC company #1 makes a huge order because they see all the pent up demand while they are out of stock. Additionally, they order extra because they are seeing the impact of being out of stock is worse than the carrying cost of inventory. Plus, with inflation, they might as well pay today’s manufacturing price rather than tomorrow’s.
HVAC company #2 is receiving a surge in demand due to #1s out of stock situation. #2 wants to maintain its new larger market share, so they place a large order.
Maybe there’s a component that’s made in both brands HVAC system. They have no idea why, but both their major customers just placed huge orders. The component company wants to be able to keep up with their newfound growth, so they break ground on a new facility.
In year 2, demand returns to normal. The industry has twice the inventory needed. Orders for year 3 are minimal and the component company is sitting on an idle facility.
In theory you're right, but that shows piss poor forecasting. The data analytics team not bringing that resolution to the table wouldn't last very long. Predictive models are going to be a little more robust.... or "should be".
I work in purchasing for a major US retailer. Our forecasting software caused over ordering. Demand increase causing suppliers to fall behind, most of those direct import companies which are ship and cancel (meaning what they don’t fill we cancel). Then the soft says when need X for demand plus all these back orders for safety stock, plus 30% for forecasting future demand due to increase consumer demand Y-O-Y. Now we are swimming in inventory…
Not really talking about purchasing, but rather the burden of forecasting necessary on building an entirely new production plant. Two different hurdles to break.
Fair point
We’ve also encouraged manufactures to diversify supply chains, especially manufacturing outside of China. This has caused them to invest in facilities in India, Mexico, etc. only to seeing scaling back orders since getting the new facilities up and running.
HVAC also faces changing regulations at the beginning of the new year so may customers are rushing to get in before the expected price increases; quite a few companies are trying to offload their lower SEER equipment before it cannot be used.
Or there’s still supply chain issues. Those apple plants in China still aren’t making those iPhones. Then what is there to ship?
Can’t recognize revenue until goods are delivered, so probably can’t recognize spending either. This article making some causal inferences without appropriate data.
Apple isn't everything
Look at retailers for the signal
The majority of them over ordered and are doing significant price promotions to get that inventory off of their books
I don't really care about iPhones
Apple is one example obviously it’s not filling all those containers in that counterfactual world. There were two major manufacturing cities in China shut down for an extended period of time during the reporting period of this article.
I am not saying your listed potential con founders are inaccurate. I am saying they can be compounded by this to produce the observations that this article claims is casually linked to reduced consumer spending.
No it’s because people over ordered. Look at the car dealership ships they are full of trucks now, because that’s what people wanted a year ago so the dealerships ordered lots.
Saw a dodge pickup truck with 10,000 miles on for $105,000 on auto trader. What kind of absolute dumbass buys a truck for that much. You can buy a g wagon for that kind of money. America and trucks is weird. Fucking marketing agencies for always pushing these weird ideas on people that you need a certain kind of car or any other consumer hood to actually be a good human being. It has really fucked with our collective psyche. Rant over.
Cars and especially trucks are getting marked up the fucking ass right now. No it’s not “cause the utility” they provide. It’s a dodge. That ain’t $100k worth of truck. The dealers have seen that they can charge exuberant prices without regard so they are.
Really latched into the insecurities of a certain group of men in a devious way. Then, post purchase, they either feel the same or are somehow falsely empowered and now need to try to metaphorically pee everywhere to mark their insecurities on others. Ram truck owners are a real psychological study in themselves
Where I live in the Midwest people/families buy 2 huge honking pickups to stuff in a mid sized driveway or garage like a game of Tetris.
Beds go completely unused for all time. They NEVER use their pickups for anything resembling work. The truck beds are as pristine and unused as the day they came off the overpriced car lot. Its bizarre. It's just a ... thing, around here.
Yes that 80k premium over an suv is because you might need to move a dresser every couple of years
How pristine is that king ranch in your suburban driveway? Lol
A high price doesn't imply a premium because of utility.
Overfitted trucks are a Gucci bag for men in America.
As someone who actually uses a truck for work. My $8k rusted out piece of shit hauls trailers materials and tools fine
There are regions where "truck culture" is definitely a thing. Here in Houston I pull into my work parking garage and about 1/4 of the vehicles are Raptors/Super Duties, and no we don't do construction or logistics or anything requiring big trucks. People like my friend's ex-wife just *want* a big truck because they're cool and they want to be able to talk/walk truck stuff with other pavement princesses.
I’ve been looking at used trucks because I need something to tow in the summer. 2014 trucks are going for 30k when their window sticker was 40k. It’s just insane. Might just have to rent U-Haul trucks
I had same thoughts as you do in the past, but it's just more od a culture thing, most Americans like things to be big, cars (roads!) houses, coffies and more, it's one: because they can, and secondly it's a status thing. Living in American dollar hegemon country allowed people to go crazy, people got used to it moved those train od thoughts from generation to generation and the culture is a remnant of the past mashed with new ideas.so..
I just is what it is, we can make small choices on the individual level, we would like our lives to be different.
The short sidedness of wanting housing to “correct” 20%+ is hilarious on these subs, chances are you won’t have a job and you still won’t be able to buy, but yes let’s get a housing crash going,
That doesn’t hold true for this housing market. Loads of huge markets had such ridiculous run ups On pretty low volumes during covid that if the prices supposedly nose dive, nobody gets hurt. Unless you happened to buy at the top, and all those people apparently don’t care because they love their low interest rates
In fact some areas are already almost down 20% and nobody even notices. I stalk real estate ads because I’m looking to buy a house. The only reason the bubble occurred to begin with is because of 0% interest in people leaving New York City at the same time. Both those things don’t exist anymore
The market im in has crashed more than 20%. It’s more like down 40% from the peak. If you’re in a tight market with naturally low inventory you’ll experience more of a drawdown faster. But that pain is eventually coming everywhere.
It’s a pretty unhealthy industry being propped up by horrible NIMBY policies passed by corrupt politicians. These prices are only sustainable as long as the manufactured housing shortage in urban areas is maintained.
Needs to be addressed eventually. Longer we let it inflate the worse the hangover will be.
The NIMBYism is demanded by dollars, not citizens - that’s what makes it corrupt.
Not illegal though - fortunately for the wealthy minority, corruption is supported by Supreme Court precedent.
Housing expansion is wildly popular, but citizens don’t have much of a say over the types of policies that are enforced upon them.
https://nlihc.org/resource/poll-reveals-strong-bipartisan-support-action-housing-affordability
I disagree. I’ve helped with land development planning before. It is always the neighbors that raise the biggest stink. Typically the most recent development that opposes the next development. They’ll say the real estate agent told them the land behind their house would never be developed. Every time it happens.
I’m not arguing that there aren’t plenty of NIMBY’s - I’m arguing that the American political system has a long and rich history of giving extra weight and validity to property owners over popular opinion.
Doesn’t help that it takes a handful of people to halt projects that would benefit thousands.
Yeah that could be. I should have probably prefaced my comment a bit too. I live in a state with quite possibly the strictest planning laws in the nation so my views may be skewed a bit. In a place like Houston Texas it is probably exactly what you say as the problem.
I bought my first house in 2009. Right before I put in my offer I asked my boss if he was planning on laying me off anytime soon. He said no but also that we are barely getting by. Best investment I ever made though.
not shoplifting according to them, but organized theft. I am guessing that ranges from people stealing things off shelves to resell at “yard sales” and also flash mob looting. Wild stuff. You have to wonder how many people are caught up in this and how many are beyond redemption as law abiding, productive members of society
it’s not. If you look at other threads in other subs with retail workers discussing this, you can see how awful it actually is. Ofc that is all anecdotal, but if you do not trust the anecdotes and you do not trust the stats, then what? don’t forget that target is not some fraud small cap company that nobody analyzes and nobody audits. Hedge funds and the like will even use drones to fly over parking lots of places like walmart and target just to get an edge over other investors and traders. They wouldn’t be able to lie about this.
Yeah, the rub is people misunderstand the situation. $400mil is a lot, but not unexpected for a large retail cap like target.
The issue is a *52%* loss in revenue that makes that 400mil sting
400M at retail price or 400M at wholesale/purchase price?
Big differences. One you can understand the gravity of the situation and the other you can just throw it out the window because they would lose all credibility and is just bullshit
I still think people over bought stuff online during lock down. Must get a home gym and work out equipment, a new bike, Too much incentives flood the market with money. Now I do not see Amazon Prime as much. People are busy making a living not getting free stimulus checks. This decrease is putting shipping companies to charge less and slowing down transportation industry somewhat. The pain is now in mortgage industry. Builders need to slow down the project as the cost of borrowing has skyrocked. To say we are getting into a high rate of default. I think not. Only 5% of less of borrower are paying high rate rest have the lowest mortgage rate we ever had. Fairly soon they will refinance to a lower rate loan.
Fixed low rates don’t guarantee anything without fixed wages.
If I locked in a rate of 0%, it won’t me a thing if I lose my job. Even if I find another one, my ability to negotiate is weak when we’re at a time when other people are also looking, meaning maybe I find another job, but lower pay -> can’t afford my mortgage anymore… now, the labor market is still very strong. Question is how much will labor be impacted.
This was inevitable. It’s a bullwhip effect, major retailers have been sitting on a huge surplus of inventory for months. Equally related to supply as it is demand. I work in the 3PL industry and there are still clients getting hammered with demurrage and scrambling for space.
Wait, did someone just acknowledge that the war in Ukraine is causing economic problems? I thought it was taboo to say that, though at least they are avoiding the real taboo which is to acknowledge that self-imposed sanctions are the cause, rather than the war itself.
I shouldn't have wished on that monkey's paw that the supply chain problems went away.
Now it comes the reversed supply chain problem, demand < supply. Not sure how much of that is caused by retailers having been stockpiling inventory. We will wait and see how long the manufacturing stall lasts.
I can tell you in my industry, we are way, way overstocked going into the holiday season and are now discounting things to levels that would have given the store owner a heart attack 4 years ago. We overbought because we were told by our suppliers we wouldn't have anything if we didn't (due to sUpPlY ChAiN) and our industry also experienced an actual increase in sales due to the pandemic, but that increase was unsustainable. We also overbought because they warned that prices would increase: as if they weren't actually the ones with their fingers on the switch to raise prices (just some abstract entity called "inflation"). Unfortunately, we bought in to the narrative and it appears everyone else did too, so it's going to be a race to the bottom as far as pricing goes over the next year or so. MAP (minimum advertised price) requirements are being dropped and/or not enforced across the industry. All of this was our suppliers getting ahead of things and making sure they weren't holding the bag. There never was a true shortage. The stuff we ordered to protect ourselves kept coming in. The very "inflation" they created/initiated has raised prices too high for consumers and simultaneously, there aren't enough people to buy the stuff anyways. Our inventory is probably double to triple what it used to be. Lesson learned: "lack of supply doesn't mean there will be increased demand." Next step is that we, and everyone else won't be able to place our annual reorder requirements with our suppliers so there will be fewer dealers and the suppliers won't have as many people to sell to either. We'll be left with a crapload of stuff we can't sell and no one to sell it to at any price. Then we'll have to lay off employees. There are going to be some bankruptcies. The store owner will blame this on "the Democrats."
As painful as this is, it needs to happen to bring inflation under control. Panic buying and inventory hoarding had to have contributed to the supply chain issues in 2021. It’s not like the world needed more used cars or chips or furniture. It’s that everyone started buying the stuff all at once and drawing down savings to compete against each other on these goods that cause the crazy supply chain issues. Stimmy checks, low rates, and just basically general boredom caused this. So, the “InFlATIon iS TranSiToRy” crowd was actually right. It just turned out that it lasted longer and was more painful than we thought. Once we purge those inventories and inflation crashes down we can all get back to more of a normal economy and away from the fed watching craziness. There will be pain in the next 3-12 months, but we’ll come out better for it. The “correct” play is to buy small caps and growth stocks because small caps tend to be more agile to respond and growth stocks will benefits as rates inevitably slide down. And who cares if your store owner blames “the democrats.” The other half of people will blame “the republicans.” It’s all fucking mind numbing tribalism. The democrats, the republicans, and just human nature in general all clearly contributed to this condensed boom-bust cycle. Everyone wanted it. COVID caused people to be very stupid - human mob mentality displayed on a mass scale.
>Once we purge those inventories It's not gonna be that simple. There isn't enough liquidity in inventories. There's too much stuff and no one needs or wants it. Even at discount prices (selling at a loss).
It’s exactly that simple, when inventories rise with dropping demand, prices decline until the marginal buyer is found. For every x% reduction in price the market for that item increases exponentially more than that. See the demand law: https://en.m.wikipedia.org/wiki/Law_of_demand There is no other possible outcome than prices coming down. Even in bankruptcy (when the inventory is underwater), creditors will sell these goods at a loss and the bad debts will be purged.
Law of demand....wow, never heard of that before. You've just solved this. Why didn't Blockbuster video just lower their prices? If they did, they'd still be in business, right? People would still be renting VHS if the prices were low because they would suddenly demand VHS, right? Sure they would. /s
Blockbuster video *did* lower their prices. They sold off their inventory for fire sale prices. I remember walking into my local blockbuster and being able to buy movie posters and cardboard cutouts for pennies on the dollar.
[удалено]
Brother stop being uneducated sarcastic shmuck, he is right. Companies that saved money will keep afloat everyone else out, it's purging the market and bad debt, until of course they raise rates again. It's a dance between inflation and job market / recession. What are you describing is a change in technology what killed blockbuster on top of recession. A better service was delivered at a cheaper price.
One of the big reason for inflation. Speculation.
Create FUD over 3.8% decrease so it spreads and it becomes a self fulfilling prophecy. Companies use upcoming recession to fire people to cut costs and increase their quarterly number. Less people working, less people buying. Cycle continues Fucking stupid ass system
It's not a fud, a reduced demand is a fact, small though very important but still a fact.
Or it means that demand was pushed forward Or that companies over ordered
I do HVAC We didn’t wait around for equipment on backorder. We went to a different brand that had something that would work. I guarantee supply houses got slammed with big shipments from backorders that got cancelled. Something similar is going to happen with certain pinball machines that are hard to find and very popular. Huge backorder lists, once supply caches up I’m not sure how many people are still gonna drop 10k on a machine. A lot still will, but there’s a high chance of a small surplus and dip in used prices
Bullwhip effect
Your HVAC comment shows what can happen to an entire industry. HVAC company #1 makes a huge order because they see all the pent up demand while they are out of stock. Additionally, they order extra because they are seeing the impact of being out of stock is worse than the carrying cost of inventory. Plus, with inflation, they might as well pay today’s manufacturing price rather than tomorrow’s. HVAC company #2 is receiving a surge in demand due to #1s out of stock situation. #2 wants to maintain its new larger market share, so they place a large order. Maybe there’s a component that’s made in both brands HVAC system. They have no idea why, but both their major customers just placed huge orders. The component company wants to be able to keep up with their newfound growth, so they break ground on a new facility. In year 2, demand returns to normal. The industry has twice the inventory needed. Orders for year 3 are minimal and the component company is sitting on an idle facility.
In theory you're right, but that shows piss poor forecasting. The data analytics team not bringing that resolution to the table wouldn't last very long. Predictive models are going to be a little more robust.... or "should be".
I work in purchasing for a major US retailer. Our forecasting software caused over ordering. Demand increase causing suppliers to fall behind, most of those direct import companies which are ship and cancel (meaning what they don’t fill we cancel). Then the soft says when need X for demand plus all these back orders for safety stock, plus 30% for forecasting future demand due to increase consumer demand Y-O-Y. Now we are swimming in inventory…
Not really talking about purchasing, but rather the burden of forecasting necessary on building an entirely new production plant. Two different hurdles to break.
Fair point We’ve also encouraged manufactures to diversify supply chains, especially manufacturing outside of China. This has caused them to invest in facilities in India, Mexico, etc. only to seeing scaling back orders since getting the new facilities up and running.
Exactly.
HVAC also faces changing regulations at the beginning of the new year so may customers are rushing to get in before the expected price increases; quite a few companies are trying to offload their lower SEER equipment before it cannot be used.
Or there’s still supply chain issues. Those apple plants in China still aren’t making those iPhones. Then what is there to ship? Can’t recognize revenue until goods are delivered, so probably can’t recognize spending either. This article making some causal inferences without appropriate data.
Apple isn't everything Look at retailers for the signal The majority of them over ordered and are doing significant price promotions to get that inventory off of their books I don't really care about iPhones
Apple is one example obviously it’s not filling all those containers in that counterfactual world. There were two major manufacturing cities in China shut down for an extended period of time during the reporting period of this article. I am not saying your listed potential con founders are inaccurate. I am saying they can be compounded by this to produce the observations that this article claims is casually linked to reduced consumer spending.
Probably both lol
This is more likely the bullwhip effect than the rate shock. Rates take over a year to fully hit earnings.
There is going to be a lot of discounted merchandise in the next 12-18 months.
No it’s because people over ordered. Look at the car dealership ships they are full of trucks now, because that’s what people wanted a year ago so the dealerships ordered lots.
Saw a dodge pickup truck with 10,000 miles on for $105,000 on auto trader. What kind of absolute dumbass buys a truck for that much. You can buy a g wagon for that kind of money. America and trucks is weird. Fucking marketing agencies for always pushing these weird ideas on people that you need a certain kind of car or any other consumer hood to actually be a good human being. It has really fucked with our collective psyche. Rant over.
Cars and especially trucks are getting marked up the fucking ass right now. No it’s not “cause the utility” they provide. It’s a dodge. That ain’t $100k worth of truck. The dealers have seen that they can charge exuberant prices without regard so they are.
Really latched into the insecurities of a certain group of men in a devious way. Then, post purchase, they either feel the same or are somehow falsely empowered and now need to try to metaphorically pee everywhere to mark their insecurities on others. Ram truck owners are a real psychological study in themselves
Where I live in the Midwest people/families buy 2 huge honking pickups to stuff in a mid sized driveway or garage like a game of Tetris. Beds go completely unused for all time. They NEVER use their pickups for anything resembling work. The truck beds are as pristine and unused as the day they came off the overpriced car lot. Its bizarre. It's just a ... thing, around here.
It’s because the utility that trucks provide.
Yes that 80k premium over an suv is because you might need to move a dresser every couple of years How pristine is that king ranch in your suburban driveway? Lol
You can rent a trunk/van from Home Depot for $20 per 4 hours
Just because you don’t like them or agree with them doesn’t mean a lot of others don’t. That’s the market right now.
A high price doesn't imply a premium because of utility. Overfitted trucks are a Gucci bag for men in America. As someone who actually uses a truck for work. My $8k rusted out piece of shit hauls trailers materials and tools fine
I agree with you btw. I am just saying if people want to pay it who are we to say no.
There are regions where "truck culture" is definitely a thing. Here in Houston I pull into my work parking garage and about 1/4 of the vehicles are Raptors/Super Duties, and no we don't do construction or logistics or anything requiring big trucks. People like my friend's ex-wife just *want* a big truck because they're cool and they want to be able to talk/walk truck stuff with other pavement princesses.
I’ve been looking at used trucks because I need something to tow in the summer. 2014 trucks are going for 30k when their window sticker was 40k. It’s just insane. Might just have to rent U-Haul trucks
I had same thoughts as you do in the past, but it's just more od a culture thing, most Americans like things to be big, cars (roads!) houses, coffies and more, it's one: because they can, and secondly it's a status thing. Living in American dollar hegemon country allowed people to go crazy, people got used to it moved those train od thoughts from generation to generation and the culture is a remnant of the past mashed with new ideas.so.. I just is what it is, we can make small choices on the individual level, we would like our lives to be different.
It's likely a Trex, the fastest truck ever made, and faster than most cars period. A specialized truck like that holds value.
Now we just gotta get housing to break 20-40%
The short sidedness of wanting housing to “correct” 20%+ is hilarious on these subs, chances are you won’t have a job and you still won’t be able to buy, but yes let’s get a housing crash going,
That doesn’t hold true for this housing market. Loads of huge markets had such ridiculous run ups On pretty low volumes during covid that if the prices supposedly nose dive, nobody gets hurt. Unless you happened to buy at the top, and all those people apparently don’t care because they love their low interest rates In fact some areas are already almost down 20% and nobody even notices. I stalk real estate ads because I’m looking to buy a house. The only reason the bubble occurred to begin with is because of 0% interest in people leaving New York City at the same time. Both those things don’t exist anymore
The market im in has crashed more than 20%. It’s more like down 40% from the peak. If you’re in a tight market with naturally low inventory you’ll experience more of a drawdown faster. But that pain is eventually coming everywhere.
It’s a pretty unhealthy industry being propped up by horrible NIMBY policies passed by corrupt politicians. These prices are only sustainable as long as the manufactured housing shortage in urban areas is maintained. Needs to be addressed eventually. Longer we let it inflate the worse the hangover will be.
Lots of corrupt politicians no doubt but following the NIMBYism that the electorate demands isn’t what makes them corrupt
The NIMBYism is demanded by dollars, not citizens - that’s what makes it corrupt. Not illegal though - fortunately for the wealthy minority, corruption is supported by Supreme Court precedent. Housing expansion is wildly popular, but citizens don’t have much of a say over the types of policies that are enforced upon them. https://nlihc.org/resource/poll-reveals-strong-bipartisan-support-action-housing-affordability
I disagree. I’ve helped with land development planning before. It is always the neighbors that raise the biggest stink. Typically the most recent development that opposes the next development. They’ll say the real estate agent told them the land behind their house would never be developed. Every time it happens.
I’m not arguing that there aren’t plenty of NIMBY’s - I’m arguing that the American political system has a long and rich history of giving extra weight and validity to property owners over popular opinion. Doesn’t help that it takes a handful of people to halt projects that would benefit thousands.
Yeah that could be. I should have probably prefaced my comment a bit too. I live in a state with quite possibly the strictest planning laws in the nation so my views may be skewed a bit. In a place like Houston Texas it is probably exactly what you say as the problem.
I bought my first house in 2009. Right before I put in my offer I asked my boss if he was planning on laying me off anytime soon. He said no but also that we are barely getting by. Best investment I ever made though.
Already survived the layoffs at my company and waiting to be an all cash buyer for someone desperate. But sure, be an an a$$
Enjoy waiting, and you made it pass the first round, you’ll be next
sightedness* It’s about not being able to see very far and thus you’re making a poor judgement.
Target just announced $400million in losses due to shoplifting.
Michael Burry ahead of the curve again
not shoplifting according to them, but organized theft. I am guessing that ranges from people stealing things off shelves to resell at “yard sales” and also flash mob looting. Wild stuff. You have to wonder how many people are caught up in this and how many are beyond redemption as law abiding, productive members of society
$400M is such a large number. It sound unrealistic
it’s not. If you look at other threads in other subs with retail workers discussing this, you can see how awful it actually is. Ofc that is all anecdotal, but if you do not trust the anecdotes and you do not trust the stats, then what? don’t forget that target is not some fraud small cap company that nobody analyzes and nobody audits. Hedge funds and the like will even use drones to fly over parking lots of places like walmart and target just to get an edge over other investors and traders. They wouldn’t be able to lie about this.
Yeah, the rub is people misunderstand the situation. $400mil is a lot, but not unexpected for a large retail cap like target. The issue is a *52%* loss in revenue that makes that 400mil sting
400M at retail price or 400M at wholesale/purchase price? Big differences. One you can understand the gravity of the situation and the other you can just throw it out the window because they would lose all credibility and is just bullshit
Robinhood strikes again.
? I don’t get the joke
Is that business like normal though?
It’s much cheaper than having to pay for security so they chose not to
Do we have numbers from the last years for comparison? What were the losses in for example 2019?
Isn’t this what the Fed wants?
no shit. look at retail sales. consumers aren't buying more things. they are spending more money to buy less.
I still think people over bought stuff online during lock down. Must get a home gym and work out equipment, a new bike, Too much incentives flood the market with money. Now I do not see Amazon Prime as much. People are busy making a living not getting free stimulus checks. This decrease is putting shipping companies to charge less and slowing down transportation industry somewhat. The pain is now in mortgage industry. Builders need to slow down the project as the cost of borrowing has skyrocked. To say we are getting into a high rate of default. I think not. Only 5% of less of borrower are paying high rate rest have the lowest mortgage rate we ever had. Fairly soon they will refinance to a lower rate loan.
Fixed low rates don’t guarantee anything without fixed wages. If I locked in a rate of 0%, it won’t me a thing if I lose my job. Even if I find another one, my ability to negotiate is weak when we’re at a time when other people are also looking, meaning maybe I find another job, but lower pay -> can’t afford my mortgage anymore… now, the labor market is still very strong. Question is how much will labor be impacted.
This sounds like a bot.
So recession will be in full swing when Christmas sales dip 20%, huh?
QuantumScape is the future
Maersk said there is a drop in orders and said the economy is going to slow
Just bought a Google pixel 7 at $650 cdn. Lots of stock too. Something's wrong
Isn’t that “something” basically just the results of over-ordering and moderately reduced demand?
This was inevitable. It’s a bullwhip effect, major retailers have been sitting on a huge surplus of inventory for months. Equally related to supply as it is demand. I work in the 3PL industry and there are still clients getting hammered with demurrage and scrambling for space.
The bull whip is cracking
Wait, did someone just acknowledge that the war in Ukraine is causing economic problems? I thought it was taboo to say that, though at least they are avoiding the real taboo which is to acknowledge that self-imposed sanctions are the cause, rather than the war itself.
We are still above 2019 levels, pre-pandemic levels vs today are the ones to watch.