The last stage of the 18.6-year real estate cycle is about “record everything.”
Record sales, record growth, record performance, tallest buildings, longest bridges… wherever you look, from the economy to the stock market and real estate, it’s records everywhere.
That’s how it always unfolds.
The most recent Thanksgiving retail sales are a case in point.
And don’t forget that here in the States, consumers are responsible for about two-thirds of the GDP. Wherever retail goes, so will the economy.
So how does this year look?
What Inflation?
After years of interest rate hikes and high inflation, the U.S. consumer should be depressed, poor, and unwilling to spend.
Yet the numbers suggest otherwise.
Between Thanksgiving and Cyber Monday, each day of this megaweekend posted higher sales numbers than last year.
Sales are up 8% across the board, according to Adobe Analytics.
And note which categories posted the highest sales growth compared to average daily October sales:
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Electronics: 171%
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Apparel: 154%
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Appliances: 129%
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Toys: 122%
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Jewelry: 113%
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Personal care: 90%… and on and on.
I don’t see anything here that would scream that we’re in the midst of a recession.
Non-discretionary items (the products you buy for pleasure rather than out of necessity) have been leading sales growth charts.
But this “non-recession” is not a one-weekend event.
Costco’s Price Tells the Story
This is just my conjecture… but weekend trips to Costco probably caused more divorces than shopping at pretty much any other outlet, save for IKEA.
Its impact on marital health notwithstanding, Costco has been on a tear this year…
And keep in mind that Costco isn’t a “recession play.” During 2009, its sales dipped as the economy was in trouble.
No, Costco is as diversified as it gets when it comes to retail. So it’s a great gauge for the health of the overall consumer sentiment.
And now mainstream analysts have started to align with my “no recession” hypothesis.
Instead of predicting gloom and doom for retail, they expect the wholesale giant (whose members sometimes sound like they’re part of a cult) to keep growing its sales well into 2026.
Well, here we are. Mainstream analysts have started to change the narrative from “a recession is imminent” to “growth will continue.”
And it will. Up until the point when it’s time for the cycle to turn.
As always, my readers will get the memo first.
For now, however, the “record everything” stage of the 18.6-year real estate cycle continues.
Invest accordingly.
Regards,
Phil Anderson
Editor, Cycles Trading with Phil Anderson
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