The fiscal cliff is the biggest Grinch of all
A new Wal-Mart poll shows that shoppers are worried about the issue.
The debate over the fiscal cliff is starting to resonate on Main Street, and Wal-Mart (WMT) is concerned that it might affect holiday sales.A poll released Tuesday by the world's largest retailer found that 15% of customers who were aware of the fiscal cliff said the debate over the automatic spending cuts and tax increases would affect what they would spend on gifts. That survey also found that 75% of those surveyed knew what the term "fiscal cliff" meant compared with 25% before the presidential election, according to Reuters.
CEO Mike Duke did not release any details of the poll and a spokesperson for the Bentonville, Ark., company could not be immediately be reached for comment. Other retailers that cater to the middle class, such as Target (TGT), Sears Holdings (SHLD) and Kohl's (KSS) would likely see similar results if they queried their shoppers. Wealthy consumers aren't enamored with the idea either. Tiffany (TIF) recently slashed its earnings outlook for the year in part because its customers continue to be worried about the economy.
I would suspect that the Wal-Mart shoppers that are most concerned about the fiscal cliff probably are in connected in some way to the defense industry. If Congress fails to act, the Pentagon's budget would be slashed by about 10%, which would lead to massive layoffs. The National Association of Manufacturers estimates these cuts would eliminate more than 1 million private sector jobs, including 130,000 manufacturing jobs, by 2014. A study cited by Washington Post estimates that 48,000 civilian jobs at the Defense Department would be lost along more than 229,000 from other federal government agencies.
The National Retail Federation is forecasting a 4.1% increase in holiday sales this year, which is below last year's actual sales rise of 5.6%. How the fiscal cliff is affecting these figures is tough to say. Customers are probably leery about shelling out big bucks for the holiday since the economy is improving at glacial rate even absent the specter of draconian government spending cuts and tax increases.
--Jonathan Berr is long Target. Follow him on Twitter@jdberr.
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I'm worried about the fiscal cliff too. But, I want it to come if it takes that for the American public to demand a replacement of all the elected bunch in Washington. I think every American should demand every congress person resign after selling all they have and giving the money toward the national debt. I am sure they have laws already in place to prevent them from losing a dime and to protect them from incompetencies. But, they should be DEMANDED to pay up. If we make a debt, we pay up or lose anything we have. The same should be true for them too. They made this debt! I did not make a dime of it. You didn't either, unless you are an elected person in D.C. They will make a last minute "deal' but we'll still have to pay. Enough is enough.
You know what? All you anti Walmart, big corporation people, I wish Walmart and other big name businesses would go out of business. Putting more unemployed on the street. Where do those people go? Those employees and most of the shoppers dont have degrees or the elements of whats needed to start businesses themselves.
That would show all of you where we go. Down. For a loooong time.
Without the big businesses employing people, what happens?
Government supports them? Who pays the Gov.?
I hope we go the way of Atlas Shrugged, then all you idiots can cry about it. Who will help you then? Obama's stash?
I hope walmart goes under and the big banks follow including the corporate farmers. For every big greedy buisness that goes under there will be thousands of mom and pops to fill the void.
Iceland had it right. The government bailed out the people and jailed the bankers and people responsible for the mess.
Google: iceland did it right
STOP THE SPENDING.
It is that simple. Obama's solution to everything is, print more paper to buy elections.
Let's do some compromise , cut spending today, not ten years from today.
Obama's version of compromise is the same as my great grandaughter, do it my way.
Who gave the Fed. power to print paper any time they want to?
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