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Americans picked up their spending modestly in April, spending money online and dining out, buoyed by a solid job market and a retreat in prices for some things, according to The Associated Press.
Car sales also rose despite prices that continue to soar, according to the Commerce Department report issued Tuesday. But consumers are facing plenty of challenges heading into the second half of the year from tightening credit to a weaker job market.
“The April retail sales report shows consumers remain inclined to spend though they are becoming more selective in their purchases,” said Oren Klachkin, lead US Economist at Oxford Economics. “However, with storm clouds gathering on the horizon, we think consumer spending will soon run out of steam.”
Americans have remained resilient in their spending even with signs of weakness elsewhere in the economy. A solid job market has contributed to that.
Yet there are signs that they are straining under the weight of higher prices, and the job market is likely to weaken in the second half, most economists believe.
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Home Depot sees first annual sales decline in more than a decade as housing ebbs, rates jump
Meanwhile, Home Depot is applying the brakes.
After years of explosive growth during the pandemic, Home Depot’s revenue during the first quarter fell short of expectations and the company cut its profit and sales outlook for the year, sending shares lower at the opening bell.
Home Depot on Tuesday projected its first decline in annual revenue since 2009 in the aftermath of the bursting of the housing bubble and financial crisis.
It was a rough start to a busy week of retail earnings and the numbers from the nation’s biggest home improvement chain dragged down retails stocks as well as the Dow. Shares in rival Lowe’s fell harder than Home Depot.
“After a three-year period of unprecedented growth for our sector, during which we grew sales by over $47 billion, we expected that fiscal 2023 would be a year of moderation for the home improvement market,” said CEO Ted Decker.
For the three months ended April 30, revenue dropped to $37.26 billion from last year’s $38.91 billion, and it was short of the $38.45 billion projected by analysts polled by Zacks Investment Research.
Sales at stores open at least a year, a key indicator of a retailer’s health, dropped 4.5%, and it dropped 4.6% for stores in the U.S.
Decker said weak sales were mostly due to lumber deflation and bad weather, particularly in its Western division which had to contend with extreme weather in California.
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You were paying out bonuses until literally hours before regulators seized your assets. To people in Ohio and around the country, this feels sickeningly familiar,” Brown said. “To most Americans, a lack of Wall Street accountability tracks with their entire experience with our economy. Workers face consequences; executives ride off into the sunset. — Sen. Sherrod Brown (D—Ohio), chair of the Senate Banking Committee.
You say you took risk management seriously. I find it hard to believe that comment. — Sen. Tim Scott (R-South Carolina), the ranking Republican on the Senate Banking Committee.
Heads of failed banks questioned on executive pay, how they handled risk at Senate hearing
Biden administration announces nearly $11 billion for renewable energy in rural communities
The U.S. Department of Agriculture announced a nearly $11 billion investment on Tuesday to help bring affordable clean energy to rural communities throughout the country.
Rural electric cooperatives, renewable energy companies and electric utilities will be able to apply for funding through two programs, U.S. Department of Agriculture Secretary Tom Vilsack said during a media briefing on Monday.
Vilsack said it was the largest single federal investment in rural electrification since President Franklin D. Roosevelt signed the Rural Electrification Act in 1936 as part of the New Deal.
“This is an exciting opportunity for the Rural Utility Service to work collaboratively with our great partners, the Rural Electric cooperatives, in order to advance a clean energy future for rural America,” Vilsack said. “So this is an exciting and an historic day, and it continues an ongoing effort to ensure that rural America is a full participant in this clean energy economy.”
The Empowering Rural America program will make $9.7 billion available for rural electric cooperatives to create renewable energy, zero-emission and carbon capture systems.
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More dogs could show up in outdoor dining spaces. Not everyone is happy about it
Monty Hobbs, the managing director of a digital marketing agency in Washington, can often be found at local restaurant patios with Mattox, his 5-year-old terrier and miniature schnauzer mix. Some waiters even bring Mattox bits of bacon.
Hobbs stresses that he doesn’t take Mattox everywhere. “He’s my dog. He’s not my child,” he said.
But Mattox is well-behaved, he said, so it’s nice to know they can drop in at a neighborhood bar if they’re out taking a walk.
That’s what they all say, says one restaurant server in Milwaukee. She says she has watched dogs drool, fight, growl and relieve themselves on restaurant patios. Dogs have bitten her and knocked her over, causing her to spill scalding hot coffee. She has also encountered diners who are allergic to dogs or afraid of them.
“It’s not a matter of liking or disliking dogs,” she said. “The point is, regardless of what the owner might say — no matter how perfect and obedient they insist their dog is — there’s no way to ensure the safety and comfort of other guests.”
Well, just in time for the summer dining season, the U.S. government has given its blessing to restaurants that want to allow pet dogs in their outdoor spaces.
But even though nearly half of states already allow canine dining outdoors, including Texas, with conditions, the issue is far from settled, with many diners and restaurants pushing back against the increasing presence of pooches.
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