Alonso,I'll take the liberty of assuming you aren't being...

Alonso,

I'll take the liberty of assuming you aren't being sarcastic in your academic reference.

As for retail sector sentiment and/or valuation, yes, I agree fully: the consumer is unhappy. Very unhappy. You can't go into a shop without seeing the acute discounting of goods, or open a newspaper to read the complaining of retailers, big and small.

But that the consumer is unhappy is not exactly a totally hidden bit of detail; on the contrary, it is very clearly observable by even the most naive of investors.

But, importantly, retail stocks are being sold off very aggressively to reflect this.

As a deep value investor, one of the few places that I can currently identify stocks that are undervalued enough to buy is in the retail sector. Sure the upcoming results are unlikely to be pretty, but I think that is already well known and therefore priced into stock valautions.

Companies with good track records of inventory management, and strong balance sheets such as MYR, NBL, SFH, SUL and WOW I think will weather the current storm well (pun intended), and sometime in the next 12 to 18 months will be valued significantly higher in the market.

The consumer cycle is exactly that: a cycle. And like all cyclical businesses, it's no good buying retail stocks at the top of the cycle when consumer spending and sentiment are booming...it's when the crowd zigs that you need to be prepared to zag.

When I see media commentary along the lines of "no sector is hated as much today as the retail sector", then my ears always prick up.

It's called buying straw hats in winter.
And right now the RETAIL sector is experiencing a really nice bitter cold snap.

Happy shopping!

Cam