Rising gas prices take toll on Wal-Mart
Studies show that retailers favored by lower-income households will get squeezed more by high gas prices and continued unemployment.
And which retailers aren't as vulnerable to changes at the pump? Costco (COST), Macy's (M) and BJ's Wholesale Club (BJ).
The reason is because poorer families in America are hurt more by gas price hikes and high unemployment levels, Bloomberg reports. And poorer families prefer to shop at Wal-Mart, one analyst says.
The analyst, Richard Hastings of Global Hunter Securities, studied the income levels of shoppers and found that 82% of Wal-Mart shoppers make less than $75,000 a year. That compares with 63% of BJ's shoppers and 55% of Costco members that make less than $75,000 a year.
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About 8% of Wal-Mart shoppers earn more than $100,000 a year, compared with 28% at Costco and 25% at BJ's.
Higher gas prices will put the squeeze on some families. And for some, that will directly translate into fewer clothing purchases. That could be a problem at Kohl's, where 29% of shoppers said that if gas prices go up, their clothes budget goes down, Bloomberg reports.
"If you’re living paycheck to paycheck or you’re on a fixed income, the rise of gas prices impacts your habits," a AAA spokesman told Bloomberg. "If you’re more affluent and can afford gasoline at any price, then you’re going to drive regardless."
Today's average gas price is $3.56 for regular gas, according to AAA's Fuel Gauge Report. A month ago, the average price for regular was $3.13, and a year ago the average price was $2.79.
Gas prices aren't the only thing on the rise. Economists think the prices of all goods and services will rise 2.3% this year, Bloomberg reports. But wages aren't matching that increase. Average hourly earnings only rose at a 1.9% annual rate in January.
The reason gas is so high is that in 2008 the oil speculators who
got in the game late lost their ****. Now they are recouping their
losses. Economics: 101 Screw the little guy as long and hard as
Number one I don't drive a damn import car. I saw this mess coming back in the 70s when people fell for the big selling campaigns put on by the Japanese to sell their little tin cars they were making at that time. My dad drove a chrysler with a V8 that got 22mpg on the road and my buddy drove a datsun that only got 24 with a tailwind. So the auto manufacturing jobs started going overseas and that was just the tip of the iceberg. Now gas is on the rise again and working in a drive in won't pay the bills. Those are the kinds of jobs the Obama administration is bragging about. You can't flip hamburgers and live like you did when working for GM. Of course the government won't tell you this because if you work for the government you live out of our pockets anyway and don't really care. Now inflation is rearing it's ugly head again to finish off what's left the near worthless dollar, if it's still worth five cents I would be surprised. Unless we bring jobs back to America it's all over and the so called government experts can go jump in the ditch.
Don't buy China products at wal-mart. You can buy China products online and not pay the middle person.
Yes wages are falling as Union membership declines. Check the charts for yourself.
Right to work for less.
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