Why CFOs Aren’t Boosting Capex

Don’t laugh when you look at the chart below because it’s a key economic indicator. As you can see, Google searches for sweatpants are down 30%-40% year over year. Last fall, searches hit a new record high by far. That’s because people were stuck inside during the pandemic. Now search traffic is back to where it bottomed at last summer.

The hope is in the next few months traffic can fall back to the prior lows (from 2016 to 2019). People buy sweatpants when they are stuck at home. This decline signals more people are working at the office and traveling. To be clear, this decline in sweatpants searches isn’t bad for clothes retailers. Consumers are upgrading their wardrobes; they are buying more expensive items than sweatpants.

RevPAR Recovery

The recovery in hotel sales is well underway. We have seen a huge burst in website traffic at hotel chains. Consumers are planning trips for when the economy reopens. There will probably be a spike in domestic vacations before international trips recover because many countries aren’t doing as well as America (in terms of COVID-19). The worst area is India which is at a new record high in cases and deaths. The situation in India is what the rest of the world could have looked like if the vaccines hadn’t been developed. It would have been a tragedy an order of magnitude higher. Specifically, the 7 day average of deaths in India is now at 1,802. America is going to focus hard on getting vaccines to other countries, but it’s too late. The situation is out of control in India.

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Disclaimer: The content in this article is for general informational and entertainment purposes only and should not be construed as financial advice. You agree that any decision you make will be ...

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