Wal-Mart's CEO Provides The Starkest Visual Of The Modern Bread Line Yet

Tyler Durden
09/22/2010 10:44 -0500

In today's Art Cashin Comments there is a stunning admission by none other than the CEO of Walmart on what modern day bread lines look like. To wit:

Profits And Baby Formula – Our pal, Rich Yamarone, over at Bloomberg picked up an eye-opening statement made by the Wal-Mart CEO last week.

I don't need to tell you that our customer remains challenged…You need not go farther than one of our stores on midnight at the end of the month. And it's real interesting to watch, about 11 p.m. customers start to come in and shop, fill their grocery basket with basic items – baby formula, milk, bread, eggs – and continue to shop and mill about the store until midnight when government electronic benefits cards get activated, and then the checkout starts and occurs. And our sales for those first few hours on the first of the month are substantially and significantly higher.

Talk about shopping only for necessities. The mid-night trip for baby formula says it all.

Luckily the NBER said the recession ended. Hurray:

So The Recession Ended 15 Months Ago – A Bloomberg report on lagging jobs got superseded by the FOMC statement. Here’s the opening line from the Bloomberg report:

Payrolls dropped in 36 U.S. states in August, led by Michigan, indicating the labor market will take time to rebound from the worst recession since the 1930s.

A little later in the article, it was noted how broad the job weakness was:

Texas lost 34,200 jobs, and California eliminated 33,600, the Labor Department said. The number of states where payrolls dropped was the highest this year.

More job losses in more states. Thank the gods that the recession’s over.

The country is collapsing everywhere and all the leaders can do is lie to their electorate that things are great. Images of the Titanic come to mind.

And some other observations from Art Cashin:

You Must Be At Least Four Feet Tall To Go On This Ride – For most of Tuesday’s trading session, the averages looked like the EKG on a Maine Potato.

From the opening bell, stocks snaked around the unchanged level for four and a half hours. The numbing lull was in anticipation of the 2:15 FOMC statement.

When the statement hit, things got really whacky.

In the first two minutes, stocks plunged. Then, suddenly, they reversed and began to spike higher. Within five minutes, the Dow was up 50 points.

That rally stopped on a dime. In the next two minutes, trading turned choppy. Then stocks began to retreat. That retreat lasted about five minutes.

Suddenly, the bulls returned, spiking the Dow to the plus 82 level. The bulls had no chance to pop the champagne cork. The rally ended instantly and stocks began to fade and by about 3:40, the Dow had turned mildly negative.

If you thought the frenzied trading in stocks was jaw-dropping, all you had to do was to look at other assets.

The dollar got pounded. Gold soared and then eased off somewhat. Treasuries rallied sharply with the yield on the ten year dipping below 2.60% (a record low). It was a stunning pyrotechnic display.

By the closing bell, stocks seemed exhausted by the spastic trading. They limped to a mixed and uncertain close.

We’ll Be There For You – That seemed to be the message that the FOMC tried to deliver in its statement yesterday.

They tried to walk a fine line, avoiding looking too worried while noting some concern.

The key phrase (to us) was in the fourth paragraph when the FOMC said it “is prepared to provide additional accommodation if needed to support the economic recovery and to return inflation, over time, to levels consistent with its mandate.â€