>> SO SEARS ROEBUCK, WHEN I WAS
GROWING UP WAS THE BIG DEAL AND
IT IS VERY SAD WHAT HAPPENED,
VERY, VERY SAD.
WHEN YOU LOOK AT THAT WHOLE
FILING THAT THEY DID LAST NIGHT
TO ME IT IS VERY SAD.
SOMEBODY THAT IS OF MY
GENERATION, SEARS ROEBUCK WAS A
BIG DEAL.
CHARLES: IT IS INDEED THE END OF
AN ERA.
SEARS FILES FOR CHAPTER 11
BANKRUPTCY PROTECTION TODAY IN A
LAST-DITCH EFFORT TO STAY ALIVE.
THE ICONIC BRAND WHICH STARTED
BACK IN THE LATE 1880s SELLING
WATCHES, HAS FACED STAGGERING
LOSSES AND MASSIVE DEBT.
ON THE SAME DAY WE GOT MIXED
RESULT ON SALES.
INTERNET WAS HUGE AND SOME
LAGGING SECTORS MADE IMPRESSIVE
REBOUNDS.
I WANT TO BRING BACK ADAM
JOHNSON, PAUL DETRICK, ART ART
ART HOGAN.
ADAM, PART OF THIS REPORT, THE
CONTROL GROUP, THEY SAID IT
WOULD BE STRONGER FOR GDP
NUMBERS.
IT WAS A MIXED REPORT.
>> IT WAS A GREAT REPORT,
CHARLES.
FINE, IF YOU LOOK AT THE
HEADLINE, DOWN .1 OF A PERCENT
THAT IS NOT WHAT YOU WANT TO
WATCH.
THE CONTROL GROUP BASICALLY
EXCLUDES BUILDING PRODUCTS,
GASOLINE, CERTAIN TYPES OF FOOD.
IN OTHER WORDS, IT, I'M SO
EXCITED I CAN'T TALK ABOUT IT.
IT RESEMBLES WHAT GDP LOOKS
LIKE.
THE FACT THAT IS UP .5 OF A
PERCENT IS HUGE, CHARLES.
I REMEMBER TALKING ABOUT GDP
GOING INTO THE FOUR HANDLE AND
NOW WE'RE IN THE THIRD QUARTER,
I SHOULD SAY SECOND QUARTER OF
GDP BEING ABOVE 4%.
I THINK WE'LL GET A LOT MORE OUT
OF IT.
IT'S A GREAT STORY, CHARLES.
CHARLES: ART, LET ME ASK YOU, IT
IS THE END OF AN ERA BUT AN END
COMING FOR A VERY LONG TIME WITH
RESPECT TO SEARS AND THERE ARE
CAUTIONARY TALES I WOULD SUSPECT
ABOUT RETAILERS OUT THERE AND
NOT JUST ABOUT AMAZON, IS ISN'T.
>> I DON'T THINK IT IS JUST
AMAZON.
CAUTIONARY TALE FOR ANYBODY IN
LEADERSHIP POSITION THAT DOESN'T
LEAD TO THE WINDS OF CHANGE AND
EASTMAN KODAK, POLAROID,
BLACKBERRY OR PALM, THINK ABOUT
COMPANIES THAT DON'T, DON'T
PIVOT AT THE TIME THINGS ARE
CHANGING.
SO FOR SEARS IT WAS REALLY
COMPANIES LIKE WALMART THAT CAME
IN AND STARTED DETERIORATING
THEIR BUSINESS AND THEY NEEDED
TO ADJUST TO THAT.
GET THE BOX SIZE A LITTLE
BIGGER, SMARTER LOCATIONS.
IT WASN'T UNTIL YEARS LATER
AMAZON ULTIMATELY HER EVERYBODY
IN RETAIL.
SEARS, OBVIOUSLY AT THAT POINT
IN TIME WAS TOO FAR GONE TO HAVE
AN ONLINE STRATEGY.
I THINK OVERARCHING MESSAGE IS,
GREAT TO BE IN FIRST PLACE AND
SEARS WAS THE NUMBER ONE
RETAILER IN THE WORLD BUT YOU
ALSO HAVE TO ADJUST TO CHANGE.
WHEN CHANGE COMES YOU HAVE TO
ADJUST YOUR BUSINESS PLAN HOW
THINGS ARE CHANGING AND CONSUMER
DEMAND CHANGING SEARS.
DIDN'T DO THAT.
SAD TO WATCH.
I BOUGHT MY FIRST SUIT 100 YEARS
AGO.
AND PEOPLE --
CHARLES: STILL HAVE IT.
YOU WORE IT JUST FOR THIS SHOW.
PAUL, CONSUMER 2/3 OF THE
ECONOMY.
THIS IS WHY THIS IS A VERY
IMPORTANT NUMBER.
OF COURSE, LIKE ALL OF THEM
THEY'RE SORT OF BACKWARD
LOOKING.
WE HAVE RETAILERS ON THE SCREEN
HIRED TODAY, YOU CAN HAVE
CHILDREN'S PLACE TO THAT LIST.
DOLLAR GENERAL TO THAT LIST.
ULTA SALONS TO THE LIST.
WHAT DO YOU MAKE OF CONSUMER? WE
NEED THE CONSUMER TO REMAIN
CONFIDENT AND GOING OUT THERE TO
CONTINUE TO SPEND.
DO YOU THINK THAT WILL HAPPEN?
>> YES, TOUGH TAKE THE MONTHLY
REPORTS IN SOME SORT OF A
BROADER CONTEXT.
I MEAN OVERALL RETAIL SALES WERE
UP 4.7% YEAR-OVER-YEAR.
WHICH IS GREAT.
AND, WHEN YOU START SEEING THOSE
DIGITAL SHOPPING AND MAIL-ORDER
NUMBERS AS OPPOSED TO THE BRICKS
AND MORTAR STORES, THOSE WERE
DOING GREAT.
THE ONLY REASON RESTAURANTS AND
BARS WHICH TOOK A HIT OF
TWO-YEAR LOW WAS LARGELY BECAUSE
OF THE HURRICANE IN THE
CAROLINAS AND THE MISERABLE
WEATHER WE'VE HAD IN THE LAST
MONTH ON THE EAST COAST.
IT IS GOING TO COME BACK.
BUT EVEN RESTAURANTS AND BARS
ARE UP 1.7% YEAR-OVER-YEAR.
THIS IS VERY STRONG.
I THINK WITH WAGES GOING UP,
EVERYONE HAVING A JOB, YOU WILL
SEE RETAIL SALES NUMBERS
CONTINUE TO CLIMB.
CHARLES: LET'S TALK REAL QUICK,
THERE IS A LOT OF TALK, ADAM,
WITH AMAZON.
>> YES.
CHARLES: SHOULD IT BE BROKEN UP
OR WILL IT INEVITABLY ONE DAY BE
BROKEN UP?
YOU KNOW, I THINK SOME POLITICAL
PARTY WILL DO THAT, OR AT LEAST
ATTEMPT TO DO THAT BUT I ALSO
BELIEVE THAT AT SOME POINT THE
MARKETS THEMSELVES WILL DO THIS,
BECAUSE WE SEE WHAT HAPPENED
WITH SEARS.
>> RIGHT.
CHARLES: WE SAW WHAT HAPPENED
WITH WOOLWORTH'S.
WE SEE TIME AFTER TIME AFTER
WHERE THESE BEHEMOTHS LOOKED
LIKE COULD NEVER BE STOPPED AND
BUT ULTIMATELY WERE.
>> CHARLES, I HOPE THE COMPANY
DOES IT.
THERE ARE REALLY TWO BUSINESS AT
AMAZON, THE AMAZON WE KNOW WHERE
YOU BUY THE STUFF AND THERE IS
AMAZON WEB SERVICES WHICH IS
GROWING 60, SIX, ZERO, PERCENT.
WHEN THEY PROVIDE BACK OFFICE
NOT JUST FOR THEMSELVES BUT SOME
BUSINESSES AROUND THE WORLD.
I HOPE THEY SPLIT THOSE TWO.
TYPICALLY DOING A SPIN-OFF LIKE
THAT YOU UNLOCK TREMENDOUS VALUE
WITHIN THE COMPANY.
TO ANSWER YOUR QUESTION, YEAH, I
HOPE THAT HAPPENS, TO HAMMER
THIS POINT HOME ABOUT RETAIL
SALES, THIS IS A GREAT AND