Check Out Pier 1’s sudden offer to buy Cost Plus for $88.4 million in stock, just as the home decor retailer is trying to cut its own losses from previous quarters by shutting stores, cutting jobs and  spending less on marketing.

Pier 1  said it would issue 0.6 shares of its common stock for each Cost Plus share outstanding. The Texas-based company believes it can seal a deal in the third quarter.

Pier 1’s chief executive officer Alex Smith thinks Cost Plus is an “excellent” fit and that a deal would improve Cost Plus’ s operating margin due to synergies with Pier 1 in areas like store operations and shared services.

From its end, Cost Plus, which sells home furnishings and gourmet food, said it would meet with its financial and legal advisors to review the proposal.

Also in the basket:

McDonald’s May same-store sales up 7.7 pct

Sotheby’s shares rise on revenue forecast

Goody’s files for Chapter 11 bankruptcy

Herbalife rebuts lead claims

U.S. gasoline rises above $4 a gallon for first time

From WAGs to watches: luxury’s soccer pitch

(Photo: Pier 1 Web site)

Check out the loss of more retail jobs. 

Another 27,000 retail jobs disappeared in May, according to the U.S. government’s monthly employment report. That makes 152,000 retail jobs eliminated since the beginning of the year.
 
Overall, nonfarm payrolls fell by 49,000. But even more worrisome for the economy and for retailers could be the jump in the unemployment rate to 5.5 percent. That half-point jump was the largest such move in 22 years and brought the unemployment rate to its highest level in 3-1/2 years.
 
Retailer’s May sales reports yesterday were mostly better than expected, causing some analysts to think they could signal the beginning of a consumer turnaround.
 
But others said it just showed a blip in spending that was caused by the tax rebate checks consumers have begun to receive. 
 
Economic concerns could still linger after all that stimulus money is gone, they say, and things could get worse if consumers, already hit by $4-a-gallon gasoline, soaring food prices and falling home values really start to worry about their jobs.

Wonder how a half-point jump in the unemployment number plays into that?
 
Meanwhile, to take your mind of the jobs report, there’s always the company pep rally that masquerades as the Wal-Mart annual meeting. The world’s-largest retailer flies in employees from all around the world to help pack the basketball arena at the University of Arkansas, where stars entertain the crowd (this year’s acts include Miley Cyrus), everybody does the Wal-Mart cheer, and, oh yeah, shareholders get to ask questions.
 
Also in the basket:
 
New Wal-Mart director may herald changing of the guard (Wall Street Journal, subscription required)
 
Target grows makeup artist brands, adds testers (WWD)

 (Photos: Reuters)

Last year, a tax refund might have been a perfect excuse to finally splurge on that luxurious Coach handbag, or dinner at that hot new restaurant downtown.

This year, that tax refund check likely means another sobering trip to the grocery store or gas station.

With shoppers feeling the burden of rising food costs, high gasoline prices, a slumping housing market, a weakening jobs picture, and the possiblity of a recession, many intend to use their tax refund this year to cover everyday expenses.

According to the Discover U.S. Spending Monitor – a monthly index of consumer spending intentions and capacity based on 15,000 interviews – of the 61 percent of adults surveyed who said they expect a tax refund this year, nearly 64 percent said they will use that cash to help pay for basic household expenses like gas, groceries or mortgages, or pay down credit card debt. 

Only 16 percent of consumers intend to put their refunds into savings, while 8.1 percent said they would use it to take a personal or family vacation.

So…how do you intend to spend your tax refund?

(Photo: Reuters)