INTERNET.
>> DANCE, GUYS.
WE APPRECIATE IT.
WE ARE TALKING ABOUT HOW GREAT
THE CONSUMERISM A LOT OF THAT IS
TRUE.
ALMOST $32 BILLION HAS BEEN
SPENT AHEAD OF BLACK FRIDAY.
LOOK AT THAT NUMBER.
A SUCCESSFUL BLACK FRIDAY COULD
COULD BRING SOME OPTIMISM TO
INVESTORS.
STOCKS HAVE BEEN GETTING
HAMMERED.
HERE IN THE STUDIO.
GOOD TO SEE YOU.
IT IS TO THESE GUYS POINT GREAT
TIMES NOW.
WE DO KNOW THE FUTURE WILL HOLD,
BUT LET'S START WITH THE
PRESENT.
IT WILL BE A TERRIFIC HOLIDAY
SEASON BY ANY MEASURE.
>> THE FACTS OR THE CAN NUMEROUS
THEORIES WRONG.
I'VE BEEN RETAIL LONG TIME.
THE STRONGEST CONSUMER AS SEEN
IN 10 OR 20 YEARS.
CALM SALES FOR RETAILERS ARE
VERY STRONG.
WHILE THE GOVERNMENT REPORTS ON
RETAIL SPENDING ARE VERY STRONG.
THERE'S NO EVIDENCE THAT
CONSUMER SLOWDOWN AT ALL.
CONNELL: WE TALK ABOUT
SEPARATION OR WE TRY TO ANSWER
THE STOCK MARKET NOT THE ECONOMY
AND VICE VERSA.
THIS WEEK IF YOU'RE JUST LOOKING
AT READING THE PAPER ARE LOOKING
AT HER SCREEN RIGHT NOW, THESE
RETAILERS ARE BOUNCING BACK
TODAY FROM IN MANY CASES
BIG-TIME SELLOUTS.
YOU WOULD THINK THERE ARE
PROBLEMS AND MAYBE THERE ARE.
MAYBE THEIR PROBLEMS IN THE
FUTURE.
SOMETIMES THE MARKET AS A WAY OF
DOING THAT.
>> YOU SAY WHY DID THESE
RETAILERS SUPPORT THESE
FANTASTIC EARNINGS AND FANTASTIC
SALES.
IT'S JUST BEEN UNBELIEVABLE IN
ALL THESE REPORTS.
AND YET THEIR STOCKS GO DOWN.
IT COULD BE THAT PEOPLE ARE
WORRIED ABOUT NEXT YEAR AND
ALREADY PRICED IN A FORWARD INTO
WHAT THEY CAN DO SO WITH ALMOST
NOTHING THEY CAN DO IN ORDER TO
SATISFY.
CONNELL: YOU'RE NEVER GOING TO
HIT THAT TARGET.
YOU'RE DOING GREAT RIGHT NOW,
BUT NEXT YEAR.
>> OTHER POSSIBILITIES ARE THE
RETAIL COST STRUCTURES REMAINS
UNDER SIGNIFICANT PRESSURE FIRST
BY THE MOVEMENT FOR BRICKS AND
MORTAR TO THE E-COMMERCE EVEN IN
THE SAME ENTERPRISE AND MAKE
THESE ON THE INTERNET.
WHEN TARGET GROWS RAPIDLY ONLINE
AND WE SAW THAT, FOR EXAMPLE IN
A VALID CONCERN.
CONNELL: IS THAT SOMETHING
HAPPENING MORE SO FOR A LONG
TIME.
>> AT THE LONG-TERM TREND SO
WHAT NOT THAT THESE COMPANIES
ARE GOING OUT OF BUSINESS.
IT'S A THICK COPY AMAZON'S MODEL
THEY DO JUST AS POORLY IN THEIR
PROFIT MARGIN ON THE BOTTOM LINE
FROM DOING THE BUSINESS ONLINE.
ALSO WE SEE WAGE PRESSURE WITH
MOVE TO THE $15 AN HOUR MINIMUM
WAGE.
THERE IS ALSO THIS AMORPHOUS
CONCERN THAT SOMEHOW ALL THE
TRADE ACTIVITY AND TARIFFS ARE
GOING TO HURT RETAILERS, BUT
NOBODY SPELLED OUT THE
MECHANISMS BY WHICH THAT WORKS
AND IS GOOD FOR SOME RETAILERS
THAT PRICES GO UP.
CONNELL: YES, THE PRICES GO UP,
BUT THEIR COSTS DON'T.
>> THE QUESTION IS CAN THEY PASS
THOSE INCREASES ON TO CONSUMERS
AND THAT HAS TO DO WITH THE
ELASTICITY OF DEMAND FOR EACH
ONE OF THESE ITEMS.
IF THERE'S NO SUBSTITUTE IN THE
PRICES GO UP AT EVERY RETAILER,
CONSUMERS BUY IT ANYWAY.
THEY WOULD ACTUALLY MAKE MORE
MONEY HAVING A HIGHER MARGIN.
CONNELL: AT SOME POINT THIS IS
THE OVERALL ECONOMY.
>> YOU COULD DO THAT EVENTUALLY.
THAT INFLATION HAS BEEN
TERRIFICALLY LOW FOR A VERY LONG
TIME AND RETAILERS DO A LITTLE
BETTER WITH MODERATE INFLATION
BECAUSE MANY OF THE COST
COMPONENTS LIKE RENT AND WAGES
ARE A KEY ON THE UPWARDS DIED
WERE PRICES GO UP IMMEDIATELY.
IT MAY NOT BE SO BAD, BUT PEOPLE
ARE STILL WORRIED ABOUT THAT A
LITTLE BIT.
THERE IS THAT ONE RETAILERS THEY
MENTION THAT IN THE EARNINGS
REPORT.
FOR THE RETAIL INDUSTRY.
DIFFERENT THAN FOR THE ECONOMY
AS A WHOLE.
CONNELL: CATERPILLAR, SOMEONE
TALKING ABOUT IT AND UNDERSTAND
WHY THEY'RE TALKING ABOUT IT.
FOR THIS INDUSTRY WOULD BE A
SIDE EFFECT.
>> THERE'S GOING TO BE A GREAT
BLACK FRIDAY, GREAT CYBERMONDAY
SAID IT PERFECTLY, VERY LONG.
AND WHICH YOU PRAY FOR IS A
RETAILER GREAT CONSUMER TIME.
THE NUMBERS ARE GOING TO BE
REALLY STRONG FOR THE HOLIDAY
PERIOD.
NO ONE KNOWS WHAT'S GOING TO
HAPPEN NEXT YEAR.
THE REPORTS COULD ISSUE FOR THE
FOURTH QUARTER NOW AND THEY'RE
ALSO STRONG WITH A LOOK AT THE
RETAIL SECTOR.
CONNELL: WHEN YOU LOOK AT THE
RETAIL SECTOR AND YOU TALK TO
THE CEO AND YOU SAY TOYS "R" US
IS DOING THE BEST OUT OF ANYBODY
BECAUSE THAT WOULD BE IN YOUR
INTEREST UNDERSTANDABLY.
WHEN YOU LOOK AT THE UPSIDE NOW
AT THE LANDSCAPE, WOULD YOU
ADMIRE?
WHO'S DOING A VERY GOOD JOB?
>> YOU STILL HAVE TO HAVE A VERY
STRONG VALUE PROPOSITION .
I LOVE RETAILERS LIKE COSTCO WAS
A RETAILERS RETAILER WHO DOES
VERY WELL.
YOU'LL SEE BIG GAINS SALES VERY
BET YOU.
VERY GOOD TRACK RECORD.
WAL-MART IS TRYING A LINE IN THE
SAND.
WE ARE GOING TO FIGHT BACK.
THEY'VE BEEN DOING AN EXCELLENT
JOB AS WELL.
KIND OF AN IFFY EARNINGS REPORT
FOR THE THIRD QUARTER.
THE REST OF THE CLASS ACT IN THE
INDUSTRY AND DOING A FANTASTIC
JOB OF MERGING ONLINE AND
OFFLINE.
THERE'S A LOT OF PEOPLE.
T.J. MAXX, ROB STORES, THEY
CONTINUE.
T.J. MAXX IS WORTH MORE THAN
TARGET.
THINK ABOUT THAT.
CONNELL: THAT IS CRAZY.
HAVE A HAPPY THANKSGIVING.
THANK YOU FOR COMING IN.
YOU LOOK AT THE BLACK FRIDAY