June Sales: Irrational Exuberance, Flip-Flops, and Pool Floaties

The News: People spent money at retail in June. What the hell? Didn't they get the memo?

Same-store sales dropped 0.8 percent in June, better than expected, according to the Thomson Reuters Same Store Sales Index.

The Winners: Discounters continue to win, as low prices on staples and gasoline bring people to Costco (where same-store comps rose 5 percent), Family Dollar (up 8 percent), Wal-Mart (up 5.8 percent), Kohl's (up 2.3 percent), and Target (up 0.4 percent, better than forecast). As noted last month, smart merchandising adds flip-flips and pool floaties to that grocery basket. Children's Place (up 16 percent) and some other kids' and teen apparel stores did well; department stores drifted. Saks rose 1.9 percent, Neiman Marcus fell 2.4 percent.

The Losers: Nordstrom had a great May, because it held its women's and kids' Half-Yearly Sale early. Therefore, we knew Nordstrom would have a bad June, and it did, down 18.6 percent. Wall Street hammered the stock anyway. Can't these guys read?

The Takeaway: At our house, the takeaway included two rashguards (one of which got left on the beach), three swimsuits, flip-flops, sunscreen, paperback novels, disposable cameras, and an expensive pair of riding boots for horse camp. The winners were Target, REI, Costco, Shepler's Western Wear, and Big 5 Sporting Goods. What's the point of being out of school if you can't have new clothes?

Image of flip-flops by David Goehring, via Flickr, CC 2.2