A discussion about retailing, retailers, and merchandising

Citing the results of yesterday's market, Doug Kass says so;

"Economic and stock market bulls got another wakeup call.

After the close yesterday, Target (TGT - Cramer's Take - Stockpickr - Rating) substantially lowered its September comp guidance from +4% to +6%, down to +1.5% to +2.5%, citing weakness in Florida and New York."

Expressing his view that the consumer is currently "spent-up" as opposed to "pent-up" (which I'll personally agree with based on my daily, real life experiences) Kass says further;

"Target was supposed to be the retail box that would prove once and for all that the spent-up, not pent-up consumer thesis was merely a figment of the bearish crowd's collective imagination. Instead, last night's announcement reinforced the odds that a retail/consumer-led recession is increasingly likely."

Referencing what interests me, merchandising (or marketing) Kass goes on to say; 

"The excuse given by economic and retail bulls has always been that Wal-Mart's (WMT - Cramer's Take - Stockpickr - Rating) marketing was inferior and antiquated, and that its consistently weak comps were company-specific. Wal-Mart, the world's largest retailer, was said to be losing market share to Target."

I'm not sure how Kass arrives at his conclusion about Wal-Mart's marketing being inferior (not that it isn't possible) but from what I've seen Wal-Mart isn't losing ground to Target. 

I believe we might be headed into a recession but I don't believe retail is spearheading that fact. Kass is clear in his thoughts about it;

"Remember, poor back-to-school sales usually correlate with a poor Christmas performance.

Retail will bleed red today and it won't rally in the days ahead."

Heck, it was just as bad last year, so far. I think we'll make it.