Walmart 'freaking out' about the economy | Arkansas Blog

Tuesday, February 19, 2013

Walmart 'freaking out' about the economy

Posted By on Tue, Feb 19, 2013 at 11:49 AM

From The Washington Post's Wonkblog:

“Well, we just had one of those weeks here at Walmart U.S. Where are all the customers? And where’s their money?”

Not doing so well. (The Washington Post)

On Friday, Bloomberg published a couple of internal e-mails from Wal-Mart executives panicking about the company’s worst sales start in seven years — “a total disaster,” as one put it. The execs attributed Wal-Mart’s slump to the payroll tax hike that kicked in on Jan. 1, cutting the median family’s take-home pay by about $1,000 this year.
So if Wal-Mart is struggling, does that mean everyone else should worry? There are two ways to look at this. The first is that this is a terrible omen. Wal-Mart makes up such a huge chunk of the U.S. economy — 2.3 percent of GDP in 2006 — that many analysts look to it as a key bellwether.

On the other hand, maybe Walmart's troubles are about competition, not the economy.

The theory here is that Wal-Mart is an “inferior good” — when times are tough and incomes are falling, consumers switch to shopping at the cheaper retail giant.

The flip side of that: When the economy rebounds, Wal-Mart’s higher-priced rivals do better. As it happens, Target’s sales rose 3.1 percent in January, part of an overall uptick in merchandise and department store shopping. So it’s very possible that Wal-Mart’s woes are just specific to the company — and not part of a broader trend.

Tags: , ,

From the ArkTimes store

Favorite

Comments (7)

Showing 1-7 of 7

Add a comment

 
Subscribe to this thread:
Showing 1-7 of 7

Add a comment

More by Max Brantley

Readers also liked…

  • Arkansas Times Recommends: A Literary Edition

    Arkansas Times Recommends is a series in which Times staff members (or whoever happens to be around at the time) highlight things we've been enjoying this week.
    • Jul 1, 2016
  • Is Arkansas in or out on Kobach voter data effort?

    The Washington Post has published a map that counts Arkansas as among states that will "partially comply" with a sweeping request for voter data by the so-called election integrity commission set up by Donald Trump in an effort to cast doubt on Hillary Clinton's 3 million-vote popular defeat of him in 2016.
    • Jul 2, 2017
  • Federal judge reprimands John Goodson for misconduct in class-action case

    John Goodson  — the Texarkana attorney, D.C. lobbyist, and husband of Arkansas State Supreme Court Justice Courtney Goodson — was reprimanded today by a federal judge for his conduct in a class-action case.
    • Aug 3, 2016

Most Viewed

Most Recent Comments

 

© 2018 Arkansas Times | 201 East Markham, Suite 200, Little Rock, AR 72201
Powered by Foundation