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ICI Flows: No Follow Through in Bonds

Takeaway: Bond funds were unable to follow through on last week's inflow which was the first weekly in 9 weeks with more outflows this week

This note was originally published October 10, 2013 at 08:14 in Financials

Investment Company Institute Mutual Fund Data and ETF Money Flow:

ICI Flows: No Follow Through in Bonds - svb 

Fixed income mutual funds flow showed no follow through with an outflow of $400 million this week, a reversal from the $1.2 billion inflow last week which was the first inflow in 9 weeks

 

Equity mutual funds booked an another outflow of $3.3 billion for the 5 day period ending October 2nd, a continuation from the $3.7 billion redemption from last week

 

Within ETFs, passive equity products experienced inflow of $1.3 billion for the 5 day period ending October 2nd with Bond ETFs losing $2.0 billion of investor funds during the week


 

ICI Flows: No Follow Through in Bonds - cast1

 

 

For the week ending October 2nd, the Investment Company Institute reported another weekly outflow in combined stock funds to the tune of $3.3 billion, essentially in line with the $3.7 billion outflow last week. The $3.3 billion outflow for the week broke out to a $739 million inflow into international equity products and a $4.1 billion outflow within domestic stock funds. The equity category has been a tale of two tapes recently with domestic equity funds having had outflows in 7 of the past 12 weeks compared to international equity funds which have had inflows every week in the past 12. Despite this weak run in domestic stock fund flows, the year-to-date weekly average for 2013 for all equity mutual funds now sits at a $2.7 billion, a complete reversal from the $3.0 billion outflow averaged per week in 2012.

 

On the fixed income side, bond funds were not able to maintain the momentum from last week and for the 5 days ending October 2nd, the aggregate of taxable and tax-free bond funds booked a $400 million outflow. The taxable bond category had slight inflows of $468 million which was washed over by the $868 million outflow in tax-free or municipal bonds. While the sharp outflows that marked most of the summer and the start of the third quarter have moderated, the appetite for bonds has hardly rebounded. The 2013 weekly average for fixed income fund flows is now a $525 million weekly outflow, a far cry from the $5.8 billion weekly inflow averaged last year.

 

We highlighted the year-to-date tallies of this rotation from bonds and into equities last week with the first inflow into total equity funds in 6 years with stock funds running at a $106 billion inflow thus far in 2013. Conversely bond mutual funds are working on their first annual outflow since 2004 with a $23 billion outflow thus far in '13. This is a substantial reversal from the $303 billion inflow into fixed income funds as laid out in our research last week.

 

Within our asset management sector launch in the middle of the summer, we released our regression models that forecasted an prospective inflow for stock funds of $80 billion and conversely a forward 12 month outflow of $100 billion for bond funds. Thus far into our coverage of the asset managers, the equity rotation has occurred at a faster than expected rate and bond fund flows have been fairly stubborn, although our forecasts have been directionally relevant. As such, we continue to recommend investors are long leading equity manager T Rowe Price (TROW) to capture this shift and conversely avoid or be short a manager more dependent on bonds like Franklin Resources (BEN).

 

Hybrid funds, or products that combine both fixed income and equity allocation had a surprisingly light week with the first outflow in 14 weeks. The year-to-date weekly average inflow for hybrid products however is still $1.6 billion for '13, almost a 100% increase from 2012's $911 million weekly average.

 

 

ICI Flows: No Follow Through in Bonds - ICI chart 2

ICI Flows: No Follow Through in Bonds - ICI chart 3

ICI Flows: No Follow Through in Bonds - ICI chart 4

ICI Flows: No Follow Through in Bonds - ICI chart 5

ICI Flows: No Follow Through in Bonds - ICI chart 6

 

 

Passive Products:

 

 

Exchange traded funds experienced mixed trends during last week with equity products booking an inflow and bond ETFs experiencing redemptions. Equity ETFs gathered $1.3 billion in funds, a deceleration from the $7.3 billion in the prior week and also down from the impressive $25.8 billion two week's ago. Including this week's production however, 2013 weekly average equity ETF trends are averaging a $3.3 billion weekly inflow, a strong improvement from last year's $2.2 billion weekly inflow average.

 

Bond ETFs experienced the first redemption in 5 weeks of $2.0 billion which was a reversal from the $1.3 billion in new funds garnered last week. Including this most recent outflow within passive bond products, the 2013 weekly bond ETF average is flagging at just a $369 million inflow, much lower than the $1.0 billion average weekly inflow from 2012.

 

In last week's ICI report we outlined the brewing ETF record for equities with 2013 thus far having produced $129 billion in stock ETF flow, well above the $117 billion produced in 2012 with still a quarter left in the year. Fixed income ETFs are struggling with just a $15 billion annual inflow year-to-date thus far in '13. This is well below 2012's trends of a $56 billion inflow. 

 

 

ICI Flows: No Follow Through in Bonds - ICI chart 7

ICI Flows: No Follow Through in Bonds - ICI chart 8

 

 

 

Jonathan Casteleyn, CFA, CMT

 

203-562-6500

 

jcasteleyn@hedgeye.com 

 

 

 

Joshua Steiner, CFA

 

203-562-6500

 

jsteiner@hedgeye.com



European Banking Monitor: Swaps Tighten on Expectations of D.C. Resolve

Below are key European banking risk monitors, which are included as part of Josh Steiner and the Financial team's "Monday Morning Risk Monitor".  If you'd like to receive the work of the Financials team or request a trial please email .

 

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European Financial CDS - Europe's banking system continues its winning ways. Swaps across European financials tightened another 14 bps, on average, last week, bringing the median EU bank to 140 bps, as compared with 101 bps for the US Financials.

 

European Banking Monitor: Swaps Tighten on Expectations of D.C. Resolve - aa.banks

 

Sovereign CDS – Sovereign swaps tightened around the world last week on rising expectations that the US will find a solution and avert default. US swaps tightened 7 bps, falling to 34 bps. Portugal, Italy and Spain saw their swaps tighten by 48, 20 and 8 bps, respectively. 

 

European Banking Monitor: Swaps Tighten on Expectations of D.C. Resolve - aa. cds

 

European Banking Monitor: Swaps Tighten on Expectations of D.C. Resolve - aa.cds 2

 

European Banking Monitor: Swaps Tighten on Expectations of D.C. Resolve - aa. cds 3

 

Euribor-OIS Spread – The Euribor-OIS spread tightened by 2 bps to 12 bps. The Euribor-OIS spread (the difference between the euro interbank lending rate and overnight indexed swaps) measures bank counterparty risk in the Eurozone. The OIS is analogous to the effective Fed Funds rate in the United States.  Banks lending at the OIS do not swap principal, so counterparty risk in the OIS is minimal.  By contrast, the Euribor rate is the rate offered for unsecured interbank lending.  Thus, the spread between the two isolates counterparty risk. 

 

European Banking Monitor: Swaps Tighten on Expectations of D.C. Resolve - aa. euibor


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Morning Reads on Our Radar Screen

Takeaway: A quick look at some stories on Hedgeye's radar screen.

Keith McCullough – CEO

No deal in sight as shutdown approaches third week (via CNN)

U.S. May Join Germany of 1933 in Pantheon of Defaults (KM note: “Ridiculous” > via Bloomberg)

Israel Finds Tunnel Dug Under Gaza-Israel Border  (via AP)

Visa rules for Chinese coming to the UK to be relaxed (via BBC)

 

Morning Reads on Our Radar Screen - car5


Daryl Jones – Macro

Hedge Fund Bears at Year High as Equities Focus on Budget (via Bloomberg)

U.S. May Join Germany of 1933 in Pantheon of Defaults (via Bloomberg)

 

Kevin Kaiser – Energy

'Dark side' of nat gas boom, according to Chanos (via CNBC)

FLASHBACK: T. Boone Pickens Is Down, But He Swears He Isn't Out (via BusinessWeek)

 

Josh Steiner – Financials

US investment balances skyrocketing to historic highs (via NY Post)

Fannie Mae, Freddie Mac to go after more strategic defaulters (via LA Times)

 

Jonathan Casteleyn – Financials

Hedge Fund Bears at Year High as Equities Focus on Budget (via Bloomberg)

 

Brian McGough – Retail

Accenture study forecasts 11% hike in US holiday spending (via Fibre2fasion)

Google Is Going to Include Your Face in Its New Ads (via BusinessWeek)

Jos. A. Bank keeps Men's Wearhouse door open (via The Deal)

Tumi Signs Outerwear License (via WWD)

Staples launches new price match policy (via Retailing Today)


MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE

Takeaway: The interbank markets of the US and Europe suggest a rising confidence in the outcome of the DC dynamic.

 

*************** Mergers and Acquisition Black Book Conference Call Today at 2PM ***************

 

Please join the Hedgeye Financials Team, Jonathan Casteleyn and Josh Steiner, for a deep dive Black Book presentation on the mergers and acquisition environment (M&A) with implications for companies including Greenhill & Co (GHL), Lazard (LAZ), and Evercore (EVR). The call will be held on Monday, October 14th at 2:00pm EDT.

 

The M&A environment continues to have a positive setup with:

 

1.)    High cash balances on corporate balance sheets

2.)    Low corporate borrowing costs

3.)    Relatively high stock currency values

4.)    Rising CEO confidence

 

Thus the market has the potential to break out of a 3 year flat environment. Every quarter removed from the Financial Crisis without substantial volatility is a quarter closer to a more robust M&A environment which has positive implications for this group of small and mid-cap Financial stocks.   

 

CALL DETAILS

  • Toll Free Number:
  • Direct Dial Number:
  • Conference Code: 893653#
  • Materials: CLICK HERE

 

For more information please email .

 

 

Risk Monitor / Key Takeaways:

Last week we indicated that the key measures we were watching for signs of risk rising are the interbank overnight rates. On that front, the news was resoundingly positive. The TED spread compressed by 3 bps to 19 bps (-16% W/W), while Euribor-OIS tightened by 2 bps to 12 bps (-13.5% W/W). This suggests that the Financials are setting up for another rally.

 

The other news on the week was, of course, JPMorgan's 3Q earnings. On that front, we were impressed with the resilience of the top line, particularly the positive trend in the NIM. Credit quality remains another key driver and we expect these two dynamics will be the principal themes of this quarter's earnings season.

 

* TED Spread Monitor – The TED spread fell 3.4 basis points last week, ending the week at 18.6 bps this week versus last week’s print of 21.99 bps.

 

* Euribor-OIS Spread – The Euribor-OIS spread tightened by 2 bps to 12 bps.  

 

* Sovereign CDS – Sovereign swaps tightened around the world last week on rising expectations that the US will find a solution and avert default. US swaps tightened 7 bps, falling to 34 bps.  

 

* European Financial CDS - Europe's banking system continues its winning ways. Swaps across European financials tightened another 14 bps, on average, last week, bringing the median EU bank to 140 bps, as compared with 101 bps for the US Financials.

 

Financial Risk Monitor Summary

 • Short-term(WoW): Positive / 4 of 13 improved / 3 out of 13 worsened / 6 of 13 unchanged

 • Intermediate-term(WoW): Positive / 6 of 13 improved / 5 out of 13 worsened / 2 of 13 unchanged

 • Long-term(WoW): Negative / 1 of 13 improved / 4 out of 13 worsened / 8 of 13 unchanged

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 15v2

 

1. U.S. Financial CDS -  Big banks saw their swaps largely unchanged last week, trading in a range of +2 to -2 bps. JPMorgan posted the best results with the -2 bps. GS the worst, at +2 bps. Mortgage insurers widened by 22 bps, on average. Overall, swaps widened for 14 out of 27 domestic financial institutions.

 

Tightened the most WoW: SLM, AIG, COF

Widened the most WoW: AGO, MBI, RDN

Tightened the most WoW: AXP, WFC, COF

Widened the most MoM: MBI, RDN, MTG

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 1

 

2. European Financial CDS - Europe's banking system continues its winning ways. Swaps across European financials tightened another 14 bps, on average, last week, bringing the median EU bank to 140 bps, as compared with 101 bps for the US Financials.

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 2

 

3. Asian Financial CDS - Bank swaps in Asia were mostly lower last week with teh one exception of IDB Bank of India, where swaps rose 10 bps. Chinese banks were 2-3 bps tighter while Japanese financials tightened 3-6 bps.

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 17

 

4. Sovereign CDS – Sovereign swaps tightened around the world last week on rising expectations that the US will find a solution and avert default. US swaps tightened 7 bps, falling to 34 bps. Portugal, Italy and Spain saw their swaps tighten by 48, 20 and 8 bps, respectively. 

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 18

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 3

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 4

 

5. High Yield (YTM) Monitor – High Yield rates fell 5.1 bps last week, ending the week at 6.24% versus 6.29% the prior week.

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 5

 

6. Leveraged Loan Index Monitor – The Leveraged Loan Index rose 1.0 point last week, ending at 1808.

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 6

 

7. TED Spread Monitor – The TED spread fell 3.4 basis points last week, ending the week at 18.6 bps this week versus last week’s print of 21.99 bps.

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 7

 

8. CRB Commodity Price Index – The CRB index rose 0.1%, ending the week at 287 versus 286 the prior week. As compared with the prior month, commodity prices have decreased -1.9%. We generally regard changes in commodity prices on the margin as having meaningful consumption implications.

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 8

 

9. Euribor-OIS Spread – The Euribor-OIS spread tightened by 2 bps to 12 bps. The Euribor-OIS spread (the difference between the euro interbank lending rate and overnight indexed swaps) measures bank counterparty risk in the Eurozone. The OIS is analogous to the effective Fed Funds rate in the United States.  Banks lending at the OIS do not swap principal, so counterparty risk in the OIS is minimal.  By contrast, the Euribor rate is the rate offered for unsecured interbank lending.  Thus, the spread between the two isolates counterparty risk. 

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 9

 

10. Chinese Interbank Rate (Shifon Index) –  The Shifon Index rose 20 basis points last week, ending the week at 3.33% versus last week’s print of 3.13%. The Shifon Index measures banks’ overnight lending rates to one another, a gauge of systemic stress in the Chinese banking system.

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 10

 

11. Markit MCDX Index Monitor – Last week spreads widened 12 bps, ending the week at 101 bps versus 89 bps the prior week. The Markit MCDX is a measure of municipal credit default swaps. We believe this index is a useful indicator of pressure in state and local governments. Markit publishes index values daily on six 5-year tenor baskets including 50 reference entities each. Each basket includes a diversified pool of revenue and GO bonds from a broad array of states. We track the 16-V1.

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 11

 

12. Chinese Steel – Steel prices in China rose 0.5% last week, or 18 yuan/ton, to 3506 yuan/ton. We use Chinese steel rebar prices to gauge Chinese construction activity, and, by extension, the health of the Chinese economy.

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 12

 

13. 2-10 Spread – Last week the 2-10 spread widened 2 bps to 234 bps. We track the 2-10 spread as an indicator of bank margin pressure.

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 13

 

14. XLF Macro Quantitative Setup – Our Macro team’s quantitative setup in the XLF shows 0.9% upside to TRADE resistance and 1.4% downside to TRADE support.

 

MONDAY MORNING RISK MONITOR: INTERBANK RISK MEASURES SHOW RISING CONFIDENCE - 14

 

Joshua Steiner, CFA

 

Jonathan Casteleyn, CFA, CMT

 


What's New Today in Retail (10/14)

Takeaway: Kate on AMZN/EBAY. We’re not liking that one. TIF dumped by Swatch. Tumi Outerwear…Huh? SPLS price matches AMZN – good luck w/ that.

EVENTS TO WATCH OVER THE NEXT 24 HOURS

              

WMT - Analyst Meeting: Tuesday 10/15 8:45 am

WWW - Investor Day: Tuesday 10/15 9:00 am

 

Hedgeye Retail Events

 

RH Black Book - Wednesday 10/16 11:00 am

 

COMPANY NEWS

 

FNP - Kate Spade

 

What's New Today in Retail (10/14) - chart1 10 14

 

Takeaway: Over the weekend, Kate Space got major exposure on Amazon, and also had promotions on eBay. AMZN maybe we understand…but eBay? Not exactly the place to be for an aspirational luxury brand. We're not thrilled with this development.

 

WWW - Blake Krueger Sounds Off on WWW's Q3 Hits

(http://www.wwd.com/footwear-news/business/blake-krueger-sounds-off-on-wwws-q3-hits-7220222?module=Footwear%20News-Business-main)

 

  • "'The acquisition has turned out better financially — from a team standpoint and from an integration standpoint — than I could have predicted,' the president, chairman and CEO of Wolverine World Wide Inc. told Footwear News in a phone interview.
  • "Overall, Sperry Top-Sider proved to be a big winner, posting double-digit increases for the 16th consecutive quarter. Krueger said that while the brand’s U.S. growth could slow, international opportunities — including a recent agreement with E-Land Group to distribute both Sperry and Keds in China — will fuel expansion. 'There’s a lot of runway in front of us yet,' the CEO said. 'It’s an opportunity that will sustain itself and grow every year.'"
  • "Addressing overall industry challenges, Krueger admitted the retail climate could weigh on the company in the fourth quarter, but he affirmed that Wolverine is prepped."

 

Takeaway: Despite his positive stance, he's still sandbagging on accretion. Analyst meeting in NYC tomorrow.

 

VFC - Vans to Relaunch Juniors as Young Contemporary Brand

(http://www.wwd.com/markets-news/juniors/vans-to-relaunch-juniors-as-young-contemporary-brand-7219614?module=hp-markets)

 

  • "As VF sets an ambitious goal for Vans to reach $2.9 billion in sales within the next four years — a 70 percent spike from the $1.7 billion in sales it expects to make this year — the unit is relaunching its juniors apparel division as a young contemporary brand for next spring."
  • "Under the leadership of a new vice president of apparel, Vicki Redding, and an influx of new women’s designers and merchandisers, Vans is moving past its previous 14-year-old customer to an older crowd between the ages of 16 and 24."
  • "Vans still has a way to go with its women’s business, as well as apparel overall. Clothing made up 20 percent of Vans’ business last year. Of that share, women’s claimed only 20 percent. Bailey said the target is to double the apparel business by 2017."

 

Takeaway: VFC is sticking behind its lofty goals for Vans. Not sure we love the idea of a juniors line to fuel the growth. But in the end, it can probably run a $200-$300mm juniors line at a respectable margin.

 

TIF, UHR - Tiffany Looking at Swatch Alternatives

(http://www.wwd.com/accessories-news/watches/tiffany-looking-at-swatch-alternatives-7219060?module=hp-business)

 

  • Tiffany, in a filing with the Securities and Exchange Commission, said it had 'received numerous communications' indicating that Swatch views their watch agreement as 'terminated as of October 1, 2013.'”
  • "Accordingly, the luxe jeweler said it is 'proceeding on that basis with plans to design, produce, market and distribute Tiffany & Co. brand watches through alternative arrangements.'”
  • "The two companies formed a 20-year strategic alliance in 2007 that created a new Swiss-based firm to produce, design and market luxury watches under the Tiffany name."

 

Takeaway: If this is not a kick in the gut to Tiffany, I don't know what is. It's used to being the prom queen. But it just got dumped.

 

TUMI - Tumi Signs Outerwear License

(http://www.wwd.com/markets-news/intimates-activewear/tumi-signs-outerwear-license-7220587?module=hp-mens)

 

  • "The premium brand, best known for its travel, business and lifestyle accessories, has signed a licensing deal with David Peyser Sportswear Inc. to design, develop and distribute Tumi outerwear for men and women."
  • "...the collection, which will launch for fall 2014...will range from $295 to $695."
  • "Tumi will open a 6,000-square-foot showroom to showcase the outerwear at 463 Seventh Avenue. It is scheduled to open by the end of the year, when the first pieces from the collection will be launched."

 

Takeaway: Seriously??? Are they going to make apparel out of the same kevlar-like material that they use to make those bullet-proof briefcases?

 

SPLS - Staples launches new price match policy

(http://www.retailingtoday.com/article/staples-launches-new-price-match-policy)

 

  • "Starting Nov. 3, the retailer will match prices on items sold and shipped by Amazon.com or any retailer that sells products in retail stores and online under the same brand."

 

Takeaway: While this is partially necessary to drive volume, we don't see how in the world it could be margin accretive.

 

DKS - Dick’s grand-opens three new stores

(http://www.chainstoreage.com/article/dick%E2%80%99s-grand-opens-three-new-stores)

 

  • "Dick’s Sporting Goods grand-opened three new stores on Friday, bringing the total store count to 541 in the U.S."
  • "The chain opened a store in Redding, Wash., at the Redding Hilltop Center, its 30th store in the state of Washington. A new opening in Victorville, Calif., at The Mall of Victor Valley, marks the 31st Dick’s store in California. And in Kansas, at the Midstate Plaza in Salina, Dick’s opened its eighth store in the state."

 

Takeaway: The last thing that DKS should be doing is adding more stores. It should be figuring out why it can't comp.

 

JOSB , MW - Jos. A. Bank keeps Men's Wearhouse door open

(http://www.thedeal.com/content/consumer-retail/jos-a-bank-keeps-mens-wearhouse-door-open.php)

 

  • "Despite Men's Wearhouse Inc.'s rejection of a $2.3 billion unsolicited bid, Jos. A. Bank Clothiers Inc. and its private equity partner Golden Gate Capital will continue to seek a friendly, negotiated agreement, according to a source familiar with the situation."
  • "The source would not rule out a scenario of Jos. A. Bank sweetening its offer to entice the target to the negotiating table, but added that Jos. A. Bank and Golden Gate are not interested in bidding against themselves."

 

SCC - Sears to hold first-ever Canadian Thanksgiving Black Friday sale

(http://www.retailingtoday.com/article/sears-hold-first-ever-canadian-thanksgiving-black-friday-sale)

 

  • "Sears Canada is getting ready to introduce the first-ever Black Friday sale in Canada to accompany Canadian Thanksgiving in October."
  • "'Our customers already participate in our Black Friday sale in November so we wanted to give them one that, in a similar style to the U.S., would accompany our own Thanksgiving Holiday,' said Doug Campbell, president and CEO, Sears Canada. 'With the variety of sales being offered in stores and online they can pick up new home essentials or even get a head start on their Holiday shopping.'"

 

GOOG - Google Is Going to Include Your Face in Its New Ads

(http://www.businessweek.com/articles/2013-10-11/google-plans-to-include-users-faces-in-ads)

  • "On Friday the company said it would begin including recommendations that Google+ users make in advertisements. The new policy kicks in on Nov. 11."
  • "Here’s how it works: You use Google+ to rate some product or service. It turns out the company behind that product wants to advertise on Google. When the company purchases an ad, your friends will see a version that includes your photo along with what you said about the product."

 

INDUSTRY NEWS

 

Accenture study forecasts 11% hike in US holiday spending

(http://www.fibre2fashion.com/news/apparel-news/newsdetails.aspx?news_id=153863)

 

  • "U.S. consumers intend to spend an average of $646 on gifts this holiday season, which would represent an 11 percent increase over the $582 they planned to spend, on average, in 2012, according to Accenture’s annual holiday shopping survey."
  • "The Accenture Holiday Shopping Survey found that one in five consumers (20 percent) plans to spend more on gifts this year, compared to 14 percent who planned to increase their holiday spending in 2012. They also are more likely to overspend their holiday budget this year (46 percent, compared to 34 percent in 2012)."

 

Takeaway: One in five consumers intend to spend more this year, but they forecast an 11% rise in total spending (which would be one of the biggest holiday's on record)??? There's some flawed logic here. We'd love to know who funded the survey.

 

Bangladeshi Garment Executive Held Captive by Workers

(http://online.wsj.com/article/SB10001424052702304330904579133573505195610.html?mod=WSJ_business_whatsNews)

 

  • The managing director of a Bangladeshi apparel company where 112 employees died in a November factory fire was held captive by workers for 12 hours over the weekend in a pay dispute.
  • "Police said workers demanding salaries and severance payments locked Delwar Hossain of Tuba Group in his office for much of the day Saturday. Mr. Hossain was later released, police said. But workers on Sunday were still holding his brother-in-law as well as a Tuba factory manager, according to police."
  • "Workers said Tuba, a garment manufacturer that owns 12 Bangladeshi clothing factories, had closed one of its factories Friday without notifying them or providing back pay and severance. With the Muslim Eid al-Adha festival just two days away, they said they couldn't afford to go home empty-handed."

 

Takeaway: And who says labor costs are not going up.

 

Automated Ad Buying Surges Online

(http://online.wsj.com/news/articles/SB10001424052702304500404579131770474789490?mod=WSJ_business_whatsNews)

 

  • "Automated ad buying, in which marketers use computerized systems to target users based on consumer data and Web-browsing histories, is expected to increase 56% this year in the U.S. to $7.4 billion, according to a study scheduled for release Monday by Magna Global, the research and ad-buying arm of Interpublic Group of Cos."
  • "Such 'programmatic buying' would represent about 53% of the $14 billion U.S. market for display-related ad businesses, the company said."
  • "About $3.9 billion of the expected automated ad spending this year, Magna said, will be through real-time bidding, in which advertisers, through machines, automatically bid for inventory that meets their ad specifications within milliseconds of it becoming available."

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