Mike Krieger: Where Food Stamps Go to Die

[HK in AK]

Interesting article........

We all know the economy sucks. We all know we are headed in the wrong direction. We all know our leaders are corrupt, immoral, greedy and violent. You don’t need me to tell you that. One thing that I have noticed recently while watching the financial markets is that despite the fact most stocks charts I pull up look awful, the major indices continue to hang in or grind higher. While it is not new news that a few large cap stocks are holding the major averages up, I want to focus on one in particular. Wal-Mart. Yes we all know Wal-Mart. Everyone has an opinion; whether you love it or hate it. In this instance, I’m not so much interested in the company itself, the stores or disturbing images of some of the people seen shopping there. No, in this case I want to take a look at the stock and ponder what it tells us about the state of affairs in both the U.S. and the global economy as a whole.

Wal-Mart’s stock is up 14% YTD, which is triple the return of the S&P 500. The stock also packs a dividend yield of 2.3%, so the total return is even better. In the last month or so the stock has become a real powerhouse as you can see in the chart below. Crushing any and all shorts under the weight of its rapid appreciation.

There’s more to it of course. Nothing exemplifies the ghetto status of the U.S. economy more than the success of Wal-Mart in the face of the ongoing destruction of what was once a vibrant and strong middle class. In case you missed it, Marion Nestle, Professor in the Department of Nutrition, Food Studies, and Public Health at NYU, came out with some interesting tidbits regarding the food stamp program. One of them is extraordinarily disturbing. She shows that Wal-Mart’s gets as much as 25% to 40% of revenue at some stores from food stamp dollars. This says it all folks. Food stamps are or course the perfect business for Wal-Mart and JP Morgan, which as I pointed out previously makes a lot of money running the program and keeping the populace in perpetual serfdom. Meanwhile, guess what another of the best performing stocks this year is? Corrections Corp of America, ticker CXW, up 41% YTD! Guess what they do? Yep, you guessed it. They lock up the serfs that get out of line. This is the Bloomberg description of CXW.

http://www.zerohedge.com/news/mike-k...tamps-go-die-0

[Ought Six]

This article seems like bullsh1t to me. I do not see the problem here. Walmart does not build stores in rich neighborhoods. Activists are always pushing to get a Walmart or a Target or whatever built in ghetto 'shopping deserts' where there are no stores, and Walmart has been complying. And do we not want people on food stamps to be getting the most food possible out of their meager budget? It not shopping at Walmart and excellent way to do that? If I was on foodstamps, I would be shopping at Walmart and other discount places for sure.

As for the 'ghetto economy', what in the hell is wrong with middle class people shopping at discount places? Being thrifty is 'the death of the middle class'? I guess I must be desperate and at the end of my rope then because I shop at Costco to save some bucks. Again, this is BS. People want to save money, so they are shopping smarter. That is a good thing. I guess the author thinks that middle class people should be doing all their shopping at fancy places, and if they are not, we are economically screwed. Ass-brained 'logic', if you ask me. It is just more of the usual anti-corporate 'Walmart is Satan' crapola.

There are plenty of legitimate reasons to worry about our economy, but this article does not enlighten us about them.

[HK in AK]

I guess I need to put together a chart of the growing percentage of Walmart's sales that are derived from foodstamps. It shows a shift in the composition of its sales.

[Xaito]

I guess I need to put together a chart of the growing percentage of Walmart's sales that are derived from foodstamps. It shows a shift in the composition of its sales.

doesn't it just mean that people with foodstamps now do what they're supposed to do? Buy?
Unless the stamps are only usable in walmart, I don't get your point. I'm sure the foodstamps secondary function is to boost sales - but it's still up to the people to decide where they shop. If walmart dominates some area in regard to shopping possibilities and prices, then that's where the lion share of the stamps will go - it's only natural and nothing wrong with it. If other shops want a bigger piece of the pie, they'll have to become more attractive - isn't that a basic principle in the free market system?

[HK in AK]

You need to widen your focus a bit. The free market system has nothing to do with the underlying story. What the story is about is that facts are bearing out that wage growth of middle class Americans is not keeping up with price increases. While the overall economy grows, even slightly, a greater percentage of Americans are loosing ground with their purchasing power; hence the ever expanding number on foodstamps. Just shows the fact that Americans are losing the middle ground when it comes to lifestyle.

[C.Puffs]

I guess I need to put together a chart of the growing percentage of Walmart's sales that are derived from foodstamps. It shows a shift in the composition of its sales.

That's more Washington's fault than Wal-Marts. Maybe if the economy wasn't in the $hitter people would be able to afford to shop elsewhere.

[shermbodius]

I shop at Walmart because I have kids and have to make my money go as far as possible. I think the article should reflect the heavy push of the Government to get everyone on stamps. http://daily***********/2012/06/27/u...participation/

[Ought Six]

I shop at Walmart because I have kids and have to make my money go as far as possible. I think the article should reflect the heavy push of the Government to get everyone on stamps. http://daily***********/2012/06/27/u...participation/

Here is a working link to sherm's article above:

http://tinyurl.com/ccv2rnj

Not sure why the Daily Caller is subject to the profanity filter.

[Ought Six]

That's more Washington's fault than Wal-Marts. Maybe if the economy wasn't in the $hitter people would be able to afford to shop elsewhere.

Exactly. The article tries to somehow blame Walmart because it offers the best price on food to food stamp recipients and is making a profit doing so. That is idiotic.

[shermbodius]

Here is a working link to sherm's article above:

http://tinyurl.com/ccv2rnj

Not sure why the Daily Caller is subject to the profanity filter.

Thanks Ought. I missed that.