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Strategies & Market Trends : Value Investing
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To: Paul Senior who wrote (28152)9/20/2007 3:26:49 PM
From: Bill Wexler  Read Replies (2) of 78523
 
I don't think you can be in ANY retail at this point, even the chains with some international exposure.

BBY is taking share from CC...granted, but the entire pie is shrinking rapidly.

The TV market is keeling over, and the exposure to the mortgage equity withdrawal treadmill is frightening. It's no accident that a running joke among the bloggers following the real estate bubble collapse involves borrowers who went overboard to buy Hummers and big TVs.

And don't forget one important economic point. All these gadgets are made in Asia...and prices at wholesale are bouncing off the bottom as inflation percolates, further exacerbated by the fact that costs at every point along the supply chain are also skyrocketing due to expensive oil. BBY will have difficulty passing along price increases to consumers, and margins will suffer.

Video games may have some traction - even in a recession. But then - why not go to the source and buy ERTS and ATVI?
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