If central banks are now almost exclusively on the defensive, we have no shortage of anecdotes and data to explain it. For a good long while economists and commentary managed to keep the US safely “decoupled” from the “overseas” maelstrom, but the deluge locally has become far too much to ignore. This is far, far deeper than just some indistinct weakness attending oil supply, as the chorus continues to swell toward the dreaded recessionary concepts.
Being flooded and overwhelmed by the “dollar” and its heavy presence is one thing, as much as it might be discarded and ignored as if some distant performance without tangibility. Instead, the “dollar’s” unwelcome financial intrusion presaged economic difficulties (true discounting quite beside what stocks do nowadays) that are just now crashing onshore. We have seen the bolt of manufacturing sentiment manifest in angry and ugly PMI’s, but now the true test.
Back in September, Challenger, Gray & Christmas tallied a flat expectation for temporary retail hiring. It seems as if retailers, already quite aware the current sales environment while also cognizant of all the ways last Christmas failed to live up to the hype, aren’t in a festive mood when it comes to managing their labor utilization this year. Most of the major retailers have already announced basically the same staffing levels as last year’s, which fell far short of initial estimates at the season’s outset. WalMart is sticking with just 60k, as Target is doing at 70k. UPS is looking for 90k to 95k, which is the same as last year though it should be pointed out that the firm ended up adding 100k by the time it was over. The only major retailer planning to add more staff is Amazon, increasing to 100k or 25% more than 2014.
With such a cautious labor tone, the next creep in departing from the “recovery” narrative is already beginning in the traffic of goods; or, specifically, the lack of traffic. This isn’t just China’s obvious industrial slowing, but rather companies already in the US wondering where this grand economy actually is (and has been). Again, this is not any financial dollar impact upon accounting statements, but the actual production and shipment of real goods:
