The Death Of Retail Real Estate Continues: 77MM Sq.Ft Of Shopping Space Closed In 2018 Already

This report was originally published by Tyler Durden at Zero Hedge

Retail real estate carnage is going to continue this year with no signs of slowing up, as Bloomberg reported this morning that over 77 million square feet of retail real estate has closed this year and that 2018 will easily pass 2017’s record of 105 million square feet closed. The latest example was the fall of the once massive Toys ‘R’ Us name:

The fall of the Toys “R” Us chain, with more than 700 U.S. stores, shows how much retail real estate has changed in just the last decade. When KKR & Co., Bain Capital, and Vornado Realty Trust took over the company in 2005, the buyers justified the $7.5 billion price, in part, because of the supposedly valuable properties that came with the deal.

If there was ever to be any silver lining to the complete carnage in the retail real estate space, it was the argument that has been perpetuated over the last decade or so: despite retail stores closing, the real estate would eventually be worth something.

This argument was made by real estate investment trusts as well as activist investors and analysts who tried to put a positive spin on the death of brick and mortar retail. Now, with more space freeing up, the bid under former retail property is at ask of falling off as supply is starting to get far ahead of demand:

Real estate can put a floor under the value of a retailer and make it easier for the company to borrow. Maybe a particular store concept doesn’t work out as consumers’ tastes change, but in that case, investors can always sell the land and buildings to someone with a better plan. Long-term leases can be similarly valuable. But what if the problem isn’t that a particular store is out of fashion, but that consumers are just shopping less at brick-and-mortar retailers in general? As more storefronts empty, the valuation floor will look wobblier.

This pace of closings puts 2018 on pace to pass 2017’s record of 105 million square feet of retail space closed:

At last count, U.S. store closures announced this year reached a staggering 77 million square feet, according to data on national and regional chains compiled by CoStar Group Inc. That means retailers are well on their way to surpassing the record 105 million square feet announced for closure in all of 2017.

It doesn’t look like the pace of these closings is going to slow anytime soon, either:

And with shifts to internet shopping and retailer debt woes continuing, there’s no indication the shakeout will end anytime soon. “A huge amount of retail real estate in the U.S. is going to meet its demise,” says James Corl, managing director and head of real estate at private equity firm Siguler Guff & Co. Property owners will “try to re-let it as a gun range or a church—or it’s going to go back to being a cornfield.”

So goes one set of stores, as go others. Despite the fact that the U.S. still has some of the most square footage of shopping space per person, there isn’t enough being spent at these locations to make them worth it:

Even though retailers have been retreating for years, the country still has about 24 square feet of shopping space per person, many times more than any other developed nation, according to research firm Green Street Advisors. Consumers aren’t spending enough offline to support such a generous amount. Vacancies are headaches for landlords, of course, but they also have a mushrooming effect. People may steer clear of a mall that has lost an anchor tenant or has an abundance of “for lease” signs in smaller spaces. Deserted big-box stores, their facades naked and parking lots barren, can spread a sense of blight for blocks around. Who wants to open a business next to a place that’s gone out of business?

The article finishes by pointing out that companies like Amazon and Whole Foods have still seen success using a brick-and-mortar retail concept. It’s possible that the space is simply just downsizing and becoming more efficient instead of disappearing entirely. Regardless, there seems to be a long runway to go in terms of retail real estate freeing up over the next couple of years. The trend of internet versus department stores also remains anything but encouraging.

And the outlook, with overlevered companies and lack of a serious bid under property prices, continues to look grim. Retailers are not going to be able to refi or recapitalize in ways necessary to try and grab onto lifelines. As the sector continues to collapse it’s going to be harder and harder to try and engineer turnarounds – this could lead to a self fulfilling prophecy of accelerating turmoil and collapse for the industry:

But not every deserted retail property can be turned into a gym, theater, or boutique outlet of a tech company. That reality will weigh on any investor thinking about scooping up a struggling chain with real estate assets today—especially buyers in private equity, who borrow heavily to finance their deals. “Retailers cannot support large debt loads,” says Perry Mandarino, head of restructuring at B. Riley FBR, an investment bank that’s worked on retail liquidations. “Add to that the possibility of a decrease in the value of other collateral, such as real estate, and the successful execution of a retail-leveraged buyout may be almost impossible.”

Almost a year ago to the day, we reported on retail closing setting up to hit a scorching pace in 2017. The narrative for 2018 stays the same, only worse. In early 2017 we pointed out the astonishing fact that “Barely a quarter into 2017, year-to-date retail store closings had already surpassed those of 2008.”

We asked in early 2017 if Amazon was assured of becoming the world’s first trillion-dollar stock, perhaps hitting the milestone even before Apple? Here is how the two names have fared since then:

The race is on.

Others have given up waiting for a recovery that seems always out of reach and are settling into what appears to be the new normal – but regardless, 2018 is setting up to, once again, break new ground in misery for retail real estate.

How To Avoid GMOs When You’re On A Budget

What’s the most controversial topic at the grocery store these days?

It’s GMOs.

Should you consume them? Are they okay in moderation? Should you strictly avoid them at all times? And if so, how on earth can you manage to navigate the store without stepping into a genetically modified landmine? And if you really want to challenge yourself, how can you do that on a budget?

The anti-GMO movement is picking up steam, for a multitude of excellent reasons. My family is making continuous efforts to remove genetically modified products from our lives. If you want to learn how you can banish them too, read on!

Forget about GMO labeling.

First of all, let’s face some facts here.  Crony capitalism in America isn’t going to allow changes that would require the labeling of genetically modified ingredients in your food.  While in a perfect world, a place that requires people selling healthfully grown organic foods to jump backwards through hoops and turn a cartwheel to be allowed to place a “certified organic label” on their items, Big Agri can blithely don hazmat suits to spray ever-increasing amounts of glyphosate on crops that have been genetically modified to withstand the poisons, with nary a word to consumers.

The reality is, Monsanto and their ilk have incredibly deep pockets. The Big Food companies that purchase vast amounts of GMO crops are also rolling in money. If you want to avoid GMOs, you can’t look to those who have a vested interest in selling them to protect you. You have to constantly educate yourself to beat them at their own game.

And their game, of course, is Monopoly.

If they refuse to label their products, we can refuse to buy them.  Money talks, and to large corporations it SHOUTS.  If their bottom line begins to dwindle because people refuse to consume their products, eventually they will have to make a change.

That’s exactly what happened with Dean Foods, actually. In 2009, Dean Foods switched their formula for their popular Silk Soymilk.  Instead of using organic soybeans, they began purchasing conventional soybeans. As we all know, nearly all of the soy grown in the United States is genetically modified – at last report it was over 94%.  So, more than likely, the soymilk that Dean Foods was putting out was GMO.  When outraged customers refused to purchase the product, Dean realized that they were losing money hand over fist, and they switched back to organic soy.

Victory: Team Anti-GMO.

So, you see, that’s how it works. In a free market where consumers have adequate information, their desires direct what is produced. The issue right now is that consumers do NOT have adequate information – at least not without a diligent search for it.

We can wish for labeling until the rBGH-free cows come home, but the battle will have to be fought without the aid of labels.

Avoiding GMOs is easier than you might think. And it can be done on a budget. Here’s how.

Learn to use the labels that DO exist.

Although companies are no required to put warning labels on GMOs, companies can opt to boast when their products are GMO-free.

The Non-GMO Project is focused in the opposite direction of the activists that insist GMOs be labeled. They are working to label products that have been scrupulously tested and are verified NOT to contain genetically modified material.

(Here’s a list of  1,000 non-gmo foods)

The pretty little butterfly label is your best indication that the product in your hand doesn’t contain GMOs.   Through a third-party verification process, the products are tested and audited to maintain their standing.

The retailers who started the Non-GMO Project were motivated by a simple idea. They believed that consumers in North America should have access to clearly-labeled non-GMO food and products, now and in the future. That conviction continues to guide the Non-GMO Project, as North America’s only independent verification for products made according to best practices for GMO avoidance.

The verification seal indicates that the product bearing the seal has gone through our verification process. Our verification is an assurance that a product has been produced according to consensus-based best practices for GMO avoidance:

• We require ongoing testing of all at-risk ingredients—any ingredient being grown commercially in GMO form must be tested prior to use in a verified product.


• We use an Action Threshold of 0.9%. This is in alignment with laws in the European Union (where any product containing more than 0.9% GMO must be labeled). Absence of all GMOs is the target for all Non-GMO Project Standard compliant products. Continuous improvement practices toward achieving this goal must be part of the Participant’s quality management systems.


• After the test, we require rigorous traceability and segregation practices to be followed in order to ensure ingredient integrity through to the finished product.


• For low-risk ingredients, we conduct a thorough review of ingredient specification sheets to determine absence of GMO risk.


• Verification is maintained through an annual audit, along with onsite inspections for high-risk products.

Other products sometimes say that they do not contain GMOs.  While this may be true, the Non-GMO Project Verified seal is earned through rigorous testing, and you can feel fairly confident that foods bearing this seal are free of genetically modified ingredients.

Another label to look for is USDA Certified Organic.

According to the USDA’s official blog, the inclusion of any type of GMOs is prohibited in an organic product.

The use of genetic engineering or genetically modified organisms (GMOs) is prohibited in organic products. This means an organic farmer can’t plant GMO seeds, an organic cow can’t eat GMO alfalfa or corn, and an organic soup producer can’t us any GMO ingredients. To meet USDA organic regulations, farmers and processors must show they aren’t using GMOs and that they are protecting their products from contact with prohibited substances, such as GMOs, from farm to table.

Sadly, it’s important to note that the USDA has relaxed their standards and “organic” now means 95% or more organic.

Learn about the likely suspects.

In the United States and Canada, two things shout “GMO” like no other: corn and soy. As of 2012, more than 94% of the soy and 88% of the corn in America was genetically modified.

The sad fact is, if you are buying anything processed at all, corn or soy is most likely to be an ingredient. And given the statistics above, it’s almost guaranteed that the corn or soy is GMO unless it’s otherwise noted. Both ingredients masquerade under many names. The lists below may seem overwhelming, but it’s important to see the number of aliases that allow these products to sneak into your food.

Here’s a sobering chart from the website Corn Allergens that shows many of the names under which corn lurks in your food.

• Acetic acid


• Alcohol


• Alpha tocopherol


• Artificial flavorings


• Artificial sweeteners


• Ascorbates


• Ascorbic acid


• Aspartame (Artificial sweetener)


• Astaxanthin


• Baking powder


• Barley malt* (generally OK, but can be contaminated)


• Bleached flour*


• Blended sugar (sugaridextrose)


• Brown sugar* (generally OK if no caramel color)


• Calcium citrate


• Calcium fumarate


• Calcium gluconate


• Calcium lactate


• Calcium magnesium acetate (CMA)


• Calcium stearate


• Calcium stearoyl lactylate


• Caramel and caramel color


• Carbonmethylcellulose sodium


• Cellulose microcrystalline


• Cellulose, methyl


• Cellulose, powdered


• Cetearyl glucoside


• Choline chloride


• Citric acid*


• Citrus cloud emulsion (CCS)


• Coco glycerides (cocoglycerides)


• Confectioner’s sugar


• Corn alcohol, corn gluten


• Corn extract


• Corn flour


• Corn oil, corn oil margarine


• Corn starch


• Corn sweetener, corn sugar


• Corn syrup, corn syrup solids


• Corn, popcorn, cornmeal


• Cornstarch, cornflour


• Crosscarmellose sodium


• Crystalline dextrose


• Crystalline fructose


• Cyclodextrin


• DATUM (a dough conditioner)


• Decyl glucoside


• Decyl polyglucose


• Dextrin


• Dextrose (also found in IV solutions)


• Dextrose anything (such as monohydrate or anhydrous)


• d-Gluconic acid


• Distilled white vinegar


• Drying agent


• Erythorbic acid


• Erythritol


• Ethanol


• Ethocel 20


• Ethyl acetate


• Ethyl alcohol


• Ethyl lactate


• Ethyl maltol


• Ethylcellulose


• Ethylene


• Fibersol-2


• Flavorings*


• Food starch


• Fructose*


• Fruit juice concentrate*


• Fumaric acid


• Germ/germ meal


• Gluconate


• Gluconic acid


• Glucono delta-lactone


• Gluconolactone


• Glucosamine


• Glucose syrup* (also found in IV solutions)


• Glucose*


• Glutamate


• Gluten


• Gluten feed/meal


• Glycerides


• Glycerin*


• Glycerol


• Golden syrup


• Grits


• High fructose corn syrup


• Hominy


• Honey*


• Hydrolyzed corn


• Hydrolyzed corn protein


• Hydrolyzed vegetable protein


• Hydroxypropyl methylcellulose


• Hydroxypropyl methylcellulose pthalate (HPMCP)


• Inositol


• Invert syrup or sugar


• Iodized salt


• Lactate


• Lactic acid*


• Lauryl glucoside


• Lecithin


• Linoleic acid


• Lysine


• Magnesium citrate


• Magnesium fumarate


• Magnesium stearate


• Maize


• Malic acid


• Malonic acid


• Malt syrup from corn


• Malt, malt extract


• Maltitol


• Maltodextrin


• Maltol


• Maltose


• Mannitol


• Methyl glucose


• Methyl glucoside


• Methyl gluceth


• Methylcellulose


• Microcrystaline cellulose


• Modified cellulose gum


• Modified corn starch


• Modified food starch


• Molasses* (corn syrup may be present; know your product)


• Mono- and di- glycerides


• Monosodium glutamate


• MSG


• Natural flavorings*


• Olestra/Olean


• Polenta


• Polydextrose


• Polylactic acid (PLA)


• Polysorbates* (e.g. Polysorbate 80)


• Polyvinyl acetate


• Potassium citrate


• Potassium fumarate


• Potassium gluconate


• Powdered sugar


• Pregelatinized starch


• Propionic acid


• Propylene glycol monostearate*


• Propylene glycol*


• Saccharin


• Salt (iodized salt)


• Semolina (unless from wheat)


• Simethicone


• Sodium carboxymethylcellulose


• Sodium citrate


• Sodium erythorbate


• Sodium fumarate


• Sodium lactate


• Sodium starch glycolate


• Sodium stearoyl fumarate


• Sorbate


• Sorbic acid


• Sorbitan* (anything)


• Sorbitol


• Sorghum* (not all is bad; the syrup and/or grain CAN be mixed with corn)


• Splenda (Artificial sweetener)


• Starch (any kind that’s not specified)


• Stearic acid


• Stearoyls


• Sucralose (Artificial sweetener)


• Sucrose


• Sugar* (not identified as cane or beet)


• Threonine


• Tocopherol (vitamin E)


• Treacle (aka golden syrup)


• Triethyl citrate


• Unmodified starch


• Vanilla, natural flavoring


• Vanilla, pure or extract


• Vanillin


• Vegetable anything that’s not specific*


• Vinegar, distilled white


• Vinyl acetate


• Vitamin C* and Vitamin E*


• Vitamins*


• Xanthan gum


• Xylitol


• Yeast*


• Zea mays


• Zein

Likewise, soy is another item that wears many hats and can be difficult to avoid. Here are some of the names under which soy could be hiding in your food. (List is from About.com)

• Bean curd


• Bean sprouts


• Bulking agent


• Edamame (fresh soybeans)


• Guar gum


• Gum arabic


• Hydrolyzed plant protein (HPP) or hydrolyzed vegetable protein (HVP)


• Hydrolyzed soy protein (HSP)


• Kinako


• Lecithin


• Miso (fermented soybean paste)


• Mixed tocopherols


• Mono- and di-glycerides


• MSG (monosodium glutamate)


• Natto


• Natural flavoring


• Nimame


• Okara


• Shoyu


• Soy (albumin, cheese, fiber, grits, milk, nuts, sprouts, yogurt, ice cream, pasta)


• Soy lecithin


• Soy protein (concentrate, hydrolyzed, isolate)


• Soy sauce


• Soya


• Soybean (curds, granules)


• Soybean oil


• Stabilizer


• Tamari


• Tempeh


• Teriyaki sauce


• Textured vegetable protein (TVP)


• Thickener


• Tofu (dofu, kori-dofu)


• Vegetable gum, starch, shortening, or oil


• Vitamin E


• Yuba

As you can see, it’s difficult to avoid potential GMOs if you eat anything that comes from a package.  Despite the fact that many people suffer from food allergies, these items are allowed to be included under names that make it difficult to discern what you’re actually getting.  Names like “thickener”, “natural flavoring”, and “drying agent” do not give the label reader much of a clue.

More than 60 GMO crops that have been approved in the US are:

• Corn (20 varieties)


• Oilseed Rape/Canola (11 varieties)


• Cotton (11 varieties)


• Tomato (6 varieties)


• Potato (4 varieties)


• Soybean (3 varieties)


• Sugar Beet (3 varieties)


• Squash (2 varieties)


• Cantaloupe


• Rice


• Flax


• Raddicchio


• Papaya


• Alfalfa


• Wheat

Fortunately, not all of these are currently on the market.  Currently corn, soybeans, cotton, canola, squash, and papaya are all sold commercially. (Source: Organic Consumers)

The best possible choices have no label at all.

Bluntly put, food manufacturers are out to deceive the consumer. They know that many people are trying to avoid GMOs, but they still want you to buy their products. This is why they are adamantly against labeling the products, although they like to say it’s because we, the mere mortal customers, just aren’t smart enough or educated enough to comprehend in our fuzzy little brains that GMOs are “safe”.  So, they opt not to disclose the inclusion of genetically modified ingredients.

If you shop at the grocery store, then I have to be honest – it’s nearly impossible to avoid GMOs. If every item you purchase is organic, then you can probably get through the checkout line unscathed. But these days, who can afford to push a cart full of organic grocery store food up to the register? I know that I certainly can’t.  Prices are sometimes triple that of a conventionally grown item. If you truly want to avoid GMOs – and by avoid I mean banish them from your dinner table and cupboards for good – you need to stop buying food with ingredients. You need to rethink where your food comes from.

Food shouldn’t contain ingredients. Food should BE ingredients.  What you purchase when doing your weekly food shopping should be the basis for delicious meals.  When you no longer eat things from packages that have long lists of ingredients in them, you will begin to free yourself from the ridiculous Monopoly game that you have been playing with Big Food.

Here are some examples:

Instead of buying a package of pasta and a jar of Alfredo sauce, make zucchini noodles and a homemade Alfredo primavera.

Instead of buying a box of flavored, sugar-y cereal for breakfast, have oatmeal (cooked from scratch – not the little packets) and top it with fruit and nuts.

Instead of a sandwich made from a loaf of processed bread and a deli meat, have a salad made from fresh greens and vegetables, and topped with a slice of chicken that you cooked yourself.

Instead of opening a can of tomato soup, puree some tomatoes and make your own soup. Top it with freshly chopped basil.

Instead of a breakfast sandwich with rubbery eggs on a processed English muffin, make a decadent omelet with farm fresh cheese and vegetables.

None of these meals takes a diploma from Le Cordon Bleu to make. None of these meals started their journey to your table at a factory farm and then on to a facility to be processed into a box on the grocery store shelf, either. They came straight from the garden or farm. Grab some farm-to-table cookbooks or vintage cookbooks, and you’ll find loads of recipes that are simple, fast, and filling.  (My favorites are The Nourished Kitchen and The Fanny Farmer Cookbook  from 1896.)  For more inspiration, think about what you like to eat, and then about how your grandmother would have made it.

It’s time to change your definition of food shopping.

It’s entirely possible for many of us to completely break up with the grocery store. I grow veggies in my backyard and I purchase what I can’t grow from farmers, farmer’s markets, CSAs, and the local co-op.  Specific staples like organic sugar and baking items come from online vendors. (I realize that these are the same items I could be purchasing at the grocery store, but I have made the personal choice to no longer do business with that industry. I try to buy direct from farms and small producers as much as possible.)

Don’t limit yourself to produce, either. Be sure to look for meat and dairy products from local vendors as well!  The organic free-range chicken that you get from your local farmer is well worth the additional price you’ll pay.  If you have a freezer, you can buy many types of meat in bulk (quarter of a cow, anyone?) I’m able to serve free range chicken, rabbit, and grass-fed beef to my family, even on a tight budget, by shopping direct from the farmers. There are few occupations where people work so hard for such a small amount of profit. Farming is a noble profession that doesn’t get the respect it deserves, and I like nothing better than giving my hard-earned dollars to people who give me true nourishment.

I can hear some of you saying, “That’s fine in the summer, but what am I supposed to eat in the winter, when there’s nothing local that is being harvested? I’ll have to go back to the grocery store.”

Not necessarily. It’s possible to skip the grocery stores (and the GMOs) even in the winter if you are prepared to do some food preservation when produce is at its peak. If you aren’t familiar with the lost arts, check out some websites, go to a class at your county extension office, or read a book. Canning, dehydrating, root cellaring, and freezingcan make your summer bounty last all through the year. I like to take extra effort when canning fruits and vegetables to make them special, so that we are excited to pop open a jar in the winter.  I add vanilla and spices to pears. I toss a little bit of garlic into the jar with green beans. Carrots have a dash of cinnamon and a dollop of honey. Jams are bursting with intense fruity flavor. Relishes, chutneys, and sauces await their invitations to the table, dressing up a wintery dish with a dash of summer. Jars of chewy dehydrated fruits are ready to go into lunchboxes, and dehydrated veggies add a burst of out-of-season nutrition to soups and sauces.

It’s amazing how far you can make a bushel of peaches extend if you use the “whole buffalo” – a family theory of food economics named by my youngest daughter that means we use every edible part of the item to help stretch our budget. We recently took 100 pounds of peaches (purchased for $1 a pound from an orchard down the road) and made 3 kinds of jam, 3 kinds of canned peaches, peach peel candy, peach liqueur, and peach iced tea. Only then, after getting every last drop of flavor and goodness out of those peaches, pit and all, did we cast the remnants onto the compost pile.

If you think you don’t have time to eschew the grocery store, with its convenient boxes and freezer aisle, reconsider. Fruits and vegetables are the original “fast food”.  Many of them can be consumed right after you pick them from the plant.

Challenge yourself to one week without groceries – you may find that the food is so much more delicious and satisfying that you don’t want to go back to the store!

Here are the top 10 things to remember when shopping for non-GMO foods.

Don’t buy into the malarkey that it’s impossible to avoid GMOs these days. It’s entirely possible when you stop playing by the rules laid out by Big Food!

Keep these things in mind when purchasing food:

1. 
   

   Stop looking for labels. Assume that if it isn’t labeled GMO-free, that it contains GMOs.

   
   


2. 
   

   Look for products that are USDA Certified Organic or Non-GMO Project Verified.

   
   


3. 
   

   Avoid all corn, soy, and canola that is not specifically labeled as non-GMO.

   
   


4. 
   

   Familiarize yourself with the abundant aliases for corn and soy.

   
   


5. 
   

   Buy ingredients, instead of food with ingredients.

   
   


6. 
   

   Cook from scratch.

   
   


7. 
   

   Stop shopping at the grocery store.

   
   


8. 
   

   Get to know your farmers personally.

   
   


9. 
   

   Preserve food while it’s in season.

   
   


10. 
    

    Don’t be wasteful. Use every single edible part to make your food dollars go further.

    
    

Do you have other ways of avoiding GMOs?  Please share them in the comments section.

Resources

GMO OMG

GMO Free Diet: How to stay healthy by identifying and avoiding dangerous foods

Genetic Roulette: The Gamble of Our Lives

GMO Food Poison Handbook: ‘Genetically-Modified’ Agriculture and Animals

The post How To Avoid GMOs When You’re On A Budget appeared first on The Sleuth Journal.

Running of the Sheeple: Videos of Black Friday Brawls and Stampedes in America

It’s the most wonderful violent time of the year.

As the Sheeple lined up and mobbed retail stores after Thanksgiving dinner and early Friday morning for deals to kick off the holiday season, one person has already been shot, fights have shut down malls, and a baby (!) was hit with a shoe.

Many people lost all sense of perspective as they got caught up in it at Walmart, Macy’s, and other stores during this grim holiday tradition in American stupidity.

Absolute insanity…

Police had to step in to break up this madness..the crowd was threatened with Tasers and pepper spray…

Videos of fights are being posted on social media by the minute, and #BlackFridayFights is already trending on Twitter. Users are uploading footage of what they’ve witnessed so far today…

JUST IN: @HooverPD say they responded to several reports of fights at the Galleria Thursday night. Here’s video of one incident outside the Buckle store. More on @WBRCnews this morning. pic.twitter.com/UZEZQGykGE

— Clare Huddleston (@Fox6Clare) November 24, 2017

Yal wanted Black Friday fights here ya go pic.twitter.com/HUkJZV2nME

— Koonce (@koonce53) November 24, 2017

Mark Dice recorded footage of Black Friday zombie shoppers waiting in line outside of stores – in the dark…

If that’s how people react over sales and ‘insane deals’ on household items…. how do you think they will react when the economic collapse hits home and people become truly desperate?

If you dare to venture out today, may the odds be ever in your favor.

Shootings, Brawls, Babies Injured as Americans Trample Each Other on Black Friday

Only in American do people trample each other to buy things on Black Friday exactly one day after being thankful for what they already have.

Chain-Store Stock Carnage Continues (Despite Biggest Jump In Retail Sales Since 2016)

Oh the irony - as bulls celebrate the best jump in retail sales since 2016, the scene for retailer stocks is an utter bloodbath...

Earlier today, US Retail Sales in July rebounded dramatically to a 0.6% MoM gain - the most since Dec 2016 - driven a surge in motor vehicles (record incentives) and department stores (more inventives?). Year-over-year saw upward revisions and a rebound to a 4.2% rise in July.

The last two month"s declines in Retail Sales have been revised away magically and we have now gone 5 months without a decline...

But one glimpse at the carnage in chain-store stocks tells a very different story... Following a week of disappointing earnings from J.C. Penney Co. and Macy’s Inc., the drumbeat resumed Tuesday as results from Advance Auto Parts Inc., Coach Inc. and Dick’s Sporting Goods Inc. sent their shares crashing...

As Bloomberg notes, at this rate, the group is poised for the worst annual decline in share prices since the financial crisis.

“Everybody is being burned in retail and people are just questioning, ‘Is there any place that’s Amazon-free?’” Gary Bradshaw, a Dallas-based fund manager for Hodges Capital Management Inc., said by phone.

“There will be some winners in retail but boy, it’s just a land mine."

However, Vitaliy Katsenelson more accurately states It’s not just Amazon’s fault. Changing consumer habits are killing old retail biz...

Retail stocks have been annihilated recently, despite the economy eking out growth. The fundamentals of the retail business look horrible: Sales are stagnating and profitability is getting worse with every passing quarter.

Jeff Bezos and Amazon get most of the credit, but this credit is misplaced. Today, online sales represent only 8.5 percent of total retail sales. Amazon, at $80 billion in sales, accounts only for 1.5 percent of total U.S. retail sales, which at the end of 2016 were around $5.5 trillion. Though it is human nature to look for the simplest explanation, in truth, the confluence of a half-dozen unrelated developments is responsible for weak retail sales.

Our consumption needs and preferences have changed significantly. Ten years ago we spent a pittance on cellphones. Today Apple sells roughly $100 billion worth of i-goods in the U.S., and about two-thirds of those sales are iPhones.

Consumer income has not changed much since 2006, thus over the last 10 years $190 billion in consumer spending was diverted toward mobile phones. Between phones and their services, this is $340 billion that will not be spent on T-shirts and shoes.

But we are not done. The combination of mid-single-digit health-care inflation and the proliferation of high-deductible plans has increased consumer direct health-care costs and further chipped away at our discretionary dollars. Health-care spending in the U.S. is $3.3 trillion, and just 3 percent of that figure is almost $100 billion.

Then there are soft, hard-to-quantify factors. Millennials and millennial-want-to-be generations (speaking for myself here) don’t really care about clothes as much as we may have 10 years ago.

All this brings us to a hard and sad reality: The U.S. is over-retailed. We simply have too many stores. Americans have four or five times more square footage per capita than other developed countries. This bloated square footage was created for a different consumer, the one who in in the ’90s and ’00s was borrowing money against her house and spending it at her local shopping mall.

But the bottom line, as we noted previously, is that America"s malls, retail stores, and fast-food restaurants are hugely overbuilt.

Mall Tenants Seek Shorter Leases As America's Relics Of The 80's Teeter On The Brink

As if things weren"t bad enough for America"s mall owners, what with the having to filling their retail space with high schools, grocers and churches, it seems that retailers have grown so uncertain about the future of these 1980s relics that they"re only willing to sign 1-2 leases these days.

As Bloomberg points out this morning, leases renewals used to be 5-10 years in length but are increasingly only being signed with 1-2 year terms.  Meanwhile, thousands of stores are closing each year and it"s only expected to get worse over time.

After more than a dozen bankruptcies this year contributed to thousands of store closures, visibility for the industry is so poor that retailers are pushing for lease renewals as short as a year or two -- down from five to 10 years.

“You’re certainly seeing the renewals geared toward the shorter term, rather than the five-year renewal,” said Andrew Graiser, head of A&G Realty Partners. Retailers are now struggling to figure out how many stores they actually need, he added, and landlords are looking at them “with a much closer eye than they did before.”

Somewhere between 9,000 and 10,000 stores will close in the U.S. this year, said Garrick Brown, vice president of Americas retail research for commercial broker Cushman & Wakefield -- more than twice as many as the 4,000 last year. He sees this figure rising to about 13,000 next year.

“Everyone’s trying to figure out where the bottom of the market’s going to be,” Brown said. He estimates it could occur in 2018 or early 2019.

Not surprisingly, retailers are finding it difficult to sign long-term leases in an environment where 26% of malls around the country are expected to close their doors over the next five years.

Further complicating the lease-length dilemma is the question of which shopping centers will still be around in a decade. Cushman & Wakefield’s Brown sees about 300 of 1,150 U.S. malls shutting down in the next five years.

Perry Mandarino, senior managing director and head of corporate finance at B. Riley & Co., predicts that retail bankruptcies and restructurings will further accelerate in 2018. Some of this will be the result of a long-overdue shakeout of the surfeit of U.S. store space, but the downturn is also compounded by shifts to online shopping and consumers spending on experiences rather than physical stuff, he said.

Meanwhile, landlords are trying to fight back, though it"s a fairly difficult task both arms tied behind their backs.

Landlords “have their backs against the wall, so they’ve been fighting back, hard,” he said. “What you have is a game of chicken up to the end.”

“With all this excess inventory, landlords are trying to do whatever they can to keep malls occupied,” Agran said. “The more empty spaces, the more difficult it is to attract new tenants.”

Frankly, it"s shocking that Abercrombie wouldn"t jump at the opportunity to scoop up some prime square footage in this mall...it already has the Chili"s awning and everything.

Amazon is Now Worth More Than Every Store in the Mall Combined

Content originally published at iBankCoin.com

Everyone knew Amazon was crushing retail, dating back at least a decade. But for some reason, very few went through with the easiest pair trade of all time -- long AMZN, short shopping mall operators. What a simple, yet brilliant, trade. Is it not?

Here"s an old market cap chart of when Amazon topped Walmart. Now it"s worth two Walmarts.

Here"s another old chart that captures the spirit of Amazon"s sales explosion. The current annual run rate is in excess of $140b.

So how does Amazon"s $143b in annual revenues stack up against other retailers?

According to Exodus, there are 31 companies in the Apparel Stores industry, the names you"re all familiar with when shopping at the old dead mall, whose sales equal $107b combined, with net income of $13.6b. Their composite market caps are $81.69b, the inversion of the price/sales ratio is indicative of an industry in duress.

Amazon"s $143b in annual sales and net income of just $9b is rewarded with a market capitalization of $469b.

Think about that for a moment. The entire shopping mall, sporting +1.1% quarterly revenue growth, does more net income than Amazon, on 40% less in revenues, and yet Amazon is valued at 5x what the entire mall is being sold for on the market today.

The Department Stores are an even worse comparison. TJX, M, KSS, SHLD, DDS, JCP, SRSC, SHOS and BONT combined do revenues of $129b, netting $10.17b in income, yet the composite market caps are just $68b on -4.5% quarterly revenue growth.

I get Amazon is the future and they"re growing at 22% per annum. But is it worth more than all the department stores and apparel stores combined 3x over?

And now for the most egregious juxtaposition: Amazon vs the Discount/Variety Store industry.

The Discount Variety stores include WMT, TGT, COST, DG, DLTR, BURL, PSMT, BIG, FRED and TUES. An impressive set of retailers, no doubt. Together, they sport sales of $729b with net income of $51b, enjoying median quarterly revenues growth of nearly 5%.

Their market caps combined equal $389b. If you threw in another COST, you might get to match Amazon"s market cap.

Does any of this shit make sense to you?

BofA Finds Consumer Spending Tumbled In December, Warns Of Disappointing Retail Sales

With this week"s most important economic data point - this Friday"s retail sales - fast approaching, economists are keen for clues if this key datapoint giving insight into the health of the US consumer will maintain the recent outsized spike in favorable and better than expected economic data, or if adversely, it may be a downward inflection point which could have significant implications on the dollar trade as RBC explained earlier. And according to BofA"s internal debit and credit card data, always released just ahead of the retail sales report, it looks like it will be the latter.

As Bank of America"s chief US economist Michelle Meyer reports, the aggregated BAC credit and debit card data showed that retail sales ex-autos declined 1.0% mom seasonally adjusted in December. "This contrasts with other indicators of consumer strength including reports of a robust holiday shopping season, a rebound in consumer confidence and strong autos sales" according to Meyer.

Actually, based on earnings reports of those companies who have recently closed their quarter, a weak December is precisely what one should expect, further corroborated by JPM"s satellite imagery at early December showing empty parking lots (recall: "Satellite Imagery Reveals Sharp Retail Spending Slowdown After The Election") and a plunge in brick and mortar sales, which has been greater than the offsetting pick up in online sales.

This is how the bank"s adjusted retail spending data looks when charted.

As BofA notes, "the BAC aggregated card data showed that retail sales exautos declined 1.0% mom SA in December. This reversed the strong gains over the prior few months, leaving the 3- month average growth rate to slow."

Amusingly, while in the past everyone ignored seasonal adjustments when it comes to retail sales (a reconciliation which as we have shown on various occasions, would always undermine the adjusted data), this time it is BofA which tries to justify the weakness with seasonal adjustments. This is how it "justifies" the sharp drop in data:

We think the explanation is that our BAC aggregated card data is biased lower due to our seasonal adjustment process. Note that the Census Bureau uses a similar approach, and therefore, we expect their data to be subject to a similar downward bias.

The two major holidays in December — Christmas and the New Year — are fixed in terms of the date but not in terms of the day of the week. This year, Christmas Eve and New Year’s Eve both fell on Saturdays. Spending on those dates was much weaker than on a typical Saturday, presumably since people were enjoying the holidays. However, the seasonal adjustment process treated these days like any other Saturday. This suggests that the adjustment process “over-fits” the data and biases the seasonally adjusted figures lower.

We think the bias in December should correct in January, translating to strong growth in January. A strong gain in January would support our view that the weakness we are seeing in the data is simply “noise”. However, that means waiting until February 15th for the January data to provide confirmation.

Unless, of course, January data does not rebound, in which case that bank"s economists can simply blame the "abnormally cold weather" for the lack of spending, as they have every time over the past three years.  Even so, with that caveat in mind, BofA warns, "since the Census Bureau uses a comparable approach, we think it is prudent to prepare for a similarly negative number in Friday"s report."

And while the December, or even January, data may surprise to the up, or downside, due to quirks in seasonal adjustments, reporting, one thing is undisputable: long-term spending trends, especially when it comes to goods and products, continue to deteriorate. Here"s BofA:

• The sector data suggests that consumers continue to spend on experiences, with airlines and lodging spending up impressively over the prior three months. Presumably, consumers are taking trips around the holidays.


• On the flipside, consumers appear to be spending less on goods, with particular weakness in electronics spending, home goods, and clothing. As we also show in Chart 6, spending at restaurants continues to weaken.

Also, as a result of surging gasoline prices, spending at gasoline stations is rebounding but only due to nominal spending increases. Which means less disposable income available to be spent on other potential purchases. 

And here is the evidence:

Restaurant spending is tumbling

Furniture and home improvement spending has flatlined

Spending on young adult clothing has tumbled.

Spending at food and beverage stores is growing at the lowest rate in 5 years.

And finally, luxury spending - that traditionally reserves to the upper middle and higher classes- continues to crash.

So aside from all that, the consumer is doing great.

Massive Outbreak of Post-Christmas Violence at U.S. Malls Epitomizes Current State of America

(RT) — Police in several US states responded to reports of at least a dozen chaotic incidents at shopping malls on Monday, including melees involving hundreds of people and false alarms about gunfire.

The disturbances broke out on the post-Christmas shopping day as many stores reopened. This year, December 26 was observed as a federal holiday in the US as Christmas Day fell on a Sunday. While many retailers have taken on the tradition of Britain’s Boxing Day sales, it traditionally pales in comparison to the US shopping extravaganza that is Black Friday, the day after Thanksgiving.

Police departments across the country were alerted to several reports of gunshots and mass brawls at a number of shopping centers, forcing shoppers to evacuate and malls to close early.

The Mills at Jersey Gardens, Elizabeth, New Jersey

Up to 10 people were injured, including two children, when chaos broke out after the noise of a chair hitting the ground reportedly caused someone to shout “gun” in the mall.

The Mayor of Elizabeth took to Twitter confirming that no shots had been fired, but that a fight had broken out.

Armed police responded to the incident and evacuated the building.

(3/4) Two injuries reported of an 8 year old w/ cut finger and a 12 year old w/ leg injury. No others reported hurt at this time.

— Chris Bollwage (@MayorBollwage) December 26, 2016

(2/3) A total of 8-10 people were injured today with non-life threatening injuries and were treated on scene.

— Chris Bollwage (@MayorBollwage) December 27, 2016

Cross Creek Mall, Fayetteville, North Carolina

North Carolina’s Cross Creek Mall was also evacuated, at the decision of the owners, after a brawl broke out between teenagers at the food court. Fayetteville Police Department confirmed they received reports of gunfire, but could not confirm any shots had been fired and found no gunshot victims or damage to property.

Hulen Mall, Fort Worth, Texas

Fort Worth Police said up to 150 teenagers were involved in a mass brawl that erupted at Hulen Mall forcing management to put the center on lockdown, according to NBCDFW.

Officers were responding to alleged gunshots in the mall parking lot when the fight erupted in the food court and spread to other parts of the mall.

Police are investigating if the incident was organized online and if it is linked to other large-scale disruptions at malls across the country.

Fox Valley Mall in Aurora, Illinois

The Fox Valley Mall was closed early Monday night after a fracas broke out in the food court.

Up to 75 police officers attended the scene as seven juveniles were arrested and more were questioned, according to ABC7 Chicago. No serious injuries were reported.

Town Center Aurora in Aurora, Colorado

Aurora Police Department shut down the Town Center Aurora after multiple clashes took place at the center, reportedly involving some 500 people.

Five juveniles were arrested on charges of disorderly conduct. Police say the fight had been planned on social media, according to Fox31 Denver.

#APDAlert: Large disturbance at @TCAurora.Mall is being closed and evacuated by APD. No one else is being will be permitted into the mall.

— Aurora Police Dept (@AuroraPD) December 27, 2016

At least 500 people involved in the disturbance at Town Center in Aurora. Five arrested, all juveniles. Charges of disorderly conduct.

— Jennifer Hicks (@JenniferCHicks) December 27, 2016

Aurora PD says the 13 similar incidents appear to be a coincidence, bc nothing points to a link #malldisturbance

— Ashley Michels (@ReporterAshley) December 27, 2016

Arizona Mills mall, Tempe, Arizona

Arizona Mills mall in Arizona was put on lockdown by management after reports of shots fired inside the shopping center. Local police confirmed no evidence of gunfire was found.

Two people, including a juvenile, were arrested after two fights broke out at the mall.

NO shots fired at AZ Mills Mall, officers on scene investigating cause of disturbance

— Tempe Police (@TempePolice) December 27, 2016

Beachwood Place mall, Beachwood, Ohio

Another false ‘shooting’ created mass hysteria in the Beachwood Place mall, causing police to use pepper spray to disperse a large crowd, according to Cleveland.com.

While police said there was no shooting they confirmed a large disturbance had broken out resulting in the arrest of one juvenile for assaulting a police officer.

The Shoppes at Buckland Hills, Manchester, Connecticut

Hundreds of teenagers took part in several fights at the mall resulting in eight arrests and closure of the center.

One Manchester officer was assaulted while trying to break up a fight but was not seriously injured.

Monroeville Mall, Monroeville, Pennsylvania

Police confirmed four arrests were made during an “incident involving several youths” at the Monroeville Mall on Monday. This comes two years after a huge brawl on the same date which resulted in a several arrests and injuries.

Monroeville Mall spokesperson says mall was never actually under lockdown during fight/arrests. Says Dick’s lowered security gates 4 safety

— KDKA Kym Gable (@Kymgable) December 27, 2016

Mall disturbances were also reported in two centers in Memphis, Tennessee and Long Island, New York. Investigations are ongoing to establish if there is any link between the melees.