Does Wal-Marts success show that the economy is picking up?

I was recently watching Cavuto on Fox Business Channel, and he had his normal crew of pundits on, and they were talking about how that since Wal-Mart is making more money; we can see that as an indication of the economy turning around. I don’t know about you, but, usually when I go to Wal-Mart, I go there for the low prices and the overall affordability of the products that are in the store. Usually when I go to my local Wal-Mart store, I can expect long lines, screaming babies and terrible customer service. I don’t know about you, but when I have extra disposable income, long lines, screaming babies and bad customer service isn’t my first choice.

I believe that the conversation by all of those “experts” on the show is an indication of how out of touch what we see on television is in respect to “real life”. I recall in a recent conversation with friends, about the Bush tax rebate, we spoke about how Wal-Mart is going to start making tons of money. One of the main reasons being, that Wal-Mart is the place where you can buy items in bulk. And when times are tough…. I buy in bulk baby!!!

The bottom line is that, increases in earnings for Wal-Mart doesn’t mean that the economy is getting better, it actually means that the worlds largest retailers’ strategic plan of becoming and staying the worlds largest retailer is working. That is just my two cents... For whatever that is worth.


Darrin M. Marion, PhD.
www.pergamoninvestments.com