At least, that’s the traditional scenario for the first few weeks of December. Consumers this year are uniquely burdened with economic headwinds (more like trade winds at this point) that are guiding their ships straight toward a fiscal cliff that has become synonymous with a new recession.
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Consensus between Wall Street, Washington, and Main Street seems to have been a nebulous disbelief in the reality of going over the edge. Politicians sparred, business leaders said their piece, and consumers tightened their belts. No surprises here, but as the clock keeps ticking (T minus 19 days), it seems like all that’s going on is more sparring, more talking, and more belt tightening.
Discount retailers have been a favorite group to track through the sluggish economy. Typically a strong performer when consumers become highly conscious of their budgets, Dollar General Corporation (NYSE:DG) made headlines on Tuesday when it effectively shot itself in the foot. The company closed down over 7 percent, despite posting record third-quarter performance, because of its gloomy expectations for the future.
“I think the customer is fatigued, they’re tired, they’re scared,” said chairman and CEO Rick Dreiling on a conference call. “Every time you turn on the television there’s a bunch of guys in suits who are frowning, telling you that the world’s going to go over the fiscal cliff.”
Dreiling’s rainy-day perspective seems to be contagious, as investors pull their money out of discount retailers across the board…