CELEBRATING MEDIOCRITY
By Charles Payne, CEO & Principal Analyst
4/13/2010 1:34:06 PM Eastern Time
The disconnect between the stock market and Main Street has been underscored by all of the rosy articles in the press, including a glowing cover story in the current issue of Newsweek (which has become a direct
PR vehicle for the White House). But we got another reminder this morning that America is not only hurting, but is moving in the wrong direction. Small businesses are hurting and taking it on the chin much the way the average person is hurting and taking it on the chin. Overnight, LVMH Moet Hennessy Louis Vuitton posted an 11% increase in sales driven by a "strong rebound" in Europe and the United States. The results were led by a 34% increase in watches and jewelry.
There is no way this reflects the nation. The stronger results from large businesses with global footprints and amazing power to cut salaries and pressure suppliers isn't a reflection of the state of most of the nation. Small businesses are the real backbone of this nation, the news from them this morning belies all of the rose-colored commentaries on newsstands. The headline optimism reading from NFIB was 86.8, missing consensus of 89, and under the pivotal 90 reading for the 18th consecutive month. Very few components were positive as nine out of ten declined or remained unchanged.
The NFIB Report
Additional Notes
* 11% of respondents see rising average selling prices
* 29% see a reduction in average selling prices
* -43% positive profit trends
* 15% loans are harder to get than last attempt
* 89% credit needs met or didn't want to borrow