TEXT OF INTERVIEW
Steve Chiotakis: We got some economic data this morning, some retail-sales numbers and initial jobless claims for last week. We’re going to get some analysis from Diane Swonk, chief economist at Mesirow Financial. She joins us live from Chicago. Good morning Diane.
Diane Swonk: Good morning.
Chiotakis: So these retail numbers are out this morning, Limited Brands surprised us with some small sales increases. Children’s Place as well. Next week, we get government data on retail. Do your best Carnac and tell us how this bodes for holiday sales.
Swonk: Well it’s not clear that this is great for holiday sales. What we are seeing is the consumer dip their toe back into the water after really being in shock a year ago. The year-over-rear comparisons — remember this was post-Lehman now — was when the entire world panicked and shut down. So we are seeing some move back in. Also, it’s important to note that many of the retailers that did well did heavy discounting. Macy’s has become a competitor to Wal-Mart now in terms of how many promotions they’re doing out there. So there still is the mood for value. The high-end still struggling quite a bit. We’re seeing that movement, not really a burst in activity, but at this stage of the game, anything that’s less bad is now good news.
Chiotakis: I want to talk about jobless numbers quickly. They fell more than expected last week. The initial claims, lowest level since January. Tell me, is this a fluke?
Swonk: I hope not. One week does not make a trend, but we certainly can hope the trend is in the right direction towards. We know private employment is moving towards zero now, rather than negative. It’s the state and local sector that we’re starting to see increases in unemployment there and more layoffs. So we’re hoping to see a turn in employment by December-January, but it’s still going to be a modest turn. These are still very high jobless-claim numbers.
Chiotakis: Diane Swonk, thanks for joining us from Chicago this morning.
Swonk: Thank you.