Friday, February 27, 2009

Doomsday Expectations Growing

In a piece that would be hilarious if it wasn't serious, Bloomberg discloses that as a result of crushed consumer confidence, more and more Americans are preparing for the metaphorical (and literal) end of days.

"A growing number of Americans are stocking the basement with Spam and
marketable gold, while they peek out from behind the curtains with their firearm
of choice,” analysts led by Chris Mier in Chicago wrote in a Feb. 26 note.
“Hormel’s plants are now running on weekends to keep up with demand."
As a "bizarre indicator" of end of days, Bloomberg shows a chart comparing the YTD returns of gold, gunmaker Strum Ruger and Spam shares, compared to the S&P500, juxtaposing it with consumer confidence.

Solaris Asset Management CIO Tim Ghriskey says, “If people believe the end of the world is coming and we’re in for anarchy, people are going to load up on weapons and Spam for their fallout shelters." Not surprisingly, Strum Ruger Q4 revenue jumped 72%, with a comparable ramp up in sales for Smith & Wesson. One could argue Q4 sales increase on expectations of stricter gun laws by Obama, however as analyst Eric Wold says "In recessionary times, people get concerned about safety, concerned about potential break-ins. You see gun sales ramp up on that."
Some more random musing by Paul Kedrosky and his take on Pascal's wager in light of a possible apocalypse here.
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frankthetank said...

Apparently Bloomberg also read Macro Man's latest post:

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Anonymous said...

I'm a trader, and certainly do not believe in the biblical "end of days". But recently I have purchased gold bars and coins, MRE's, rice, water, garden seed, and added to my supplies of 7.62mm, 5.56mm, gasoline, and .45ACP. My off-road vehicle stays fueled and loaded in my garage in case a departure to my other location becomes necessary. Mostly concerned about the possibility of social unrest and gang-style raids on civilian population. Remember that most people alive today have no idea what to do in hard times. Anger/revolt is likely. Germans are burning Porsche's in Berlin..what would the target of choice be in the US?