Retail in tears

Retailers have measured a drop in sales compared to last year. The “festive” season, which represents up to a fifth of their annual business, has been disappointing, and though online shopping has grown it does not fill the gap. In France, this has been blamed on the Yellow Vests, but then they are being accused of all France’s woes. In the UK, this fall in Xmas spending is associated with Brexit, as are most other ongoing disruptions. In the US, the trade skirmishes with China are mentioned, and the belated, as far as December is concerned, federal shutdown and layoff of 800,000 employees is put forward. However, there could be a common denominator to all this slack in consumption. It could be that the future does not look too rosy and, instead of lavishly spending tomorrow’s incomes, people are wondering if these incomes will actually materialise. It could also mean that borrowing has peaked, as all growth must at some point. And that is bad news for capital, because debt fuels most of its profits. Pity the poor retailer who is the first to feel the pain.