Tuesday, August 18, 2009
How Much Wal Mart Stock are These Guys Holding?
So.... I'm catching up on Bloomberg Surveillance and listening to two different people regarding the Retail numbers that just came out on August 13. And I hear two different analysts discuss how great Wal Mart is these days, that they have better selection, new brands, and are poised for growth in the Mid-West and Western States. The idea is that they'll get you in with good grocery prices, and then try to make profits on the rest of the inventory.
I don't know what Wal Mart these guys are visiting, but my local non-Super Wal Mart is still the same old overgrown Dollar General I've always known. Sure, they've added some coolers to sell chilled beer, but it's no grocery store. More and more over the past few years I have walked the isles observing that their stuff seems more and more cheaper, while the prices keep creeping up. I think if Sam Walton knew what his kids allowed his store to become, he'd be turning over in his grave. On the other hand, Wal Mart has evolved to seek organic growth and had to change its business model. Nevertheless, I don't see Wal Mart trying too hard to be a 'better' store, just a store with more volume.
Mrs. Edgy and I use to enjoy going to the Wal-to-Wal Mart when we first got hitched almost a decade ago. We see some of the same items we used to buy in smaller quantities, thinner materials, and higher costs. One easy example is Christmas tinsel rope that we string around the tree. We're glad we manage to find the 15-footer for less than the 6-footers sell for today. That's good ol' inflation, and it has snuck up on us.
I'm finding less reasons to head to Wal Mart all the time, they are no longer the low price leader!
Meanwhile, there's another interview with Robert Prechter, someone whose books I've been wanting to read for a while now. He's putting his money into "cash equivalents" (like T-bond and T-bills), and doesn't expect stocks or commodities to be a real value for a few more years to come. I like his theory, but I still think that we'll see one more mini-bubble before the value buying time comes. I don't think it will be the "square root" shaped recovery that Binder and Prechter seem to be planning.
Anyway, that's for long-term money. I'm still trying to work on practicing daily and weekly swing trading. Still busy with the deadlines at work, and now the Honey-Do list is getting enforced. Fortunately, I've been in cash since Thursday and missed out on all the fun Friday and Monday. S&P took a breather today, but I see the Daily trend is still down. When I get time to look, I'll be looking for small priced stocks ($1-$5) with some volume that are following their own patterns.