On Chicago’s State Street, I found these dinosaurs creeping up on a Christmas tree at the FAO Schwarz section inside Macy’s:

Moving on to an empty TV section in Sears:

At Sears, Christmas decorations were already 60 percent off:

And at Charlotte Russe, more discounts:

Check out a stream of extremely sobering news from – and for – retailers.

This week, quarterly reports came in from Macy’s, Kohl’s, Nordstrom, JC Penney, Charlotte Russe, and Abercrombie & Fitch.

What did they all have in common? All reported profit drops and in the case of Macy’s and Charlotte Russe, quarterly losses.

Those dreary results followed a bankruptcy filing by Circuit City at the start of the week and then a large profit warning from competitor Best Buy.

Wal-Mart, the retailing behemoth, was able to post a nearly 10 percent rise in its quarterly earnings. But investors were somewhat taken aback when it provided a fourth-quarter earnings forecast that could possibly fall below Wall Street expectations, as it gets hit by a stronger U.S. dollar — which lowers the value of its international sales.

To cap it all off, government data showed on Friday that sales at U.S. retailers suffered a record decline in October. Sales slumped 2.8 percent last month to a seasonally adjusted $363.7 billion, the largest decline since the series began in 1992, the Commerce Department said. This compared with a revised 1.3 percent fall in September, previously reported as a 1.2 percent decrease.

It all comes just two weeks before retailers try to get consumers into their stores — and then actually spending money — during the Thanksgiving holiday shopping week. Get ready for a discount bonanza!

Also in the basket:

Wal-Mart CFO: strong dollar could lower cost of goods

Walmart.com CEO says sales grow despite downturn

Americans teetering on $14 trillion debt pile

(Photo: Reuters)

Macy’s is still finding ways to celebrate in what could be a dark winter for retail this year. Customers entering Macy’s flagship store in New York City’s Herald Square it opened today were met by the pounding beats of the Soul Tigers Marching Band, lots of red balloons and a barrel full of exploding ribbons.  

CEO Terry Lundgren was there cutting a ribbon promising another 150 years for the department store, to tack onto its current 150th birthday. A gaggle of employees sang “Happy Birthday Macy’s!”, threw confetti and danced.

Macy’s birthday celebration comes at the same time most retailers are struggling with flagging sales as consumers pressured by a global financial crisis, a housing market crash, rising food prices and a credit crunch cut back spending on non-essential items.   

Macy’s recently cut its own forecasts, but is also reaching out to a bit more investors. Last week, it announced it will temporarily reinstate monthly reports of its sales to keep the market updated during uncertain times.

Rowland Hussey Macy opened his first store in 1858 at 6th Avenue and 14th Street in New York and made $11.06 in sales its first day, or around $345 in today’s dollars. The company reported 2007 sales of $26.32 billion and operates more than 850 stores including both Macy’s and Bloomingdale’s.   

(Photo/Reuters)

Check Out Alaska Gov. and hockey mom Sarah Palin, who’s not only John McCain’s vice presidential pick, but a luxury fashion maverick.

The Republican National Committee has spent more than $150,000 since late August to outfit Palin and her family in the fanciest of duds from department stores like Saks and Neiman Marcus, says politico.com.

The financial disclosure records, included under the line item “itemized coordinated expenditures,” show RNC expenditures at Saks Fifth Avenue in St. Louis and New York of $49,425.74 in September. Based on Saks’  September comparable-store sales of $273.2 million,  Palin accounted for .018 percent of sales.

The RNC also spent $75,062.63 during one September trip to Neiman Marcus, says politico.com, which would represent .012 percent of Neiman’s September comparable-store sales of $406 million.

The RNC spent only $789.72 at Neiman-owned Barneys New York but dropped $5,102.71 at Bloomingdale’s, which is operated by Macy’s, said politico.com, a website that tracks political news.

Hefty primping expenditures on the campaign trail are nothing new. U.S. Senator Hillary Rodham Clinton, D-NY, received guff for her expensive custom-made pantsuits, which cost upward of $6,350 each.

The RNC also spent $4,716.49 on Palin’s hair and makeup, and made $295  in purchases at high-end children’s stores Pacifier and Steiniauf & Stroller Inc., according to politico.com.

Tracey Schmitt, a spokeswoman for the McCain-Palin campaign, said there are plans to donate the expensive clothing to charity after the campaign.

“With all of the important issues facing the country right now, it’s remarkable that we’re spending time talking about pantsuits and blouses,” Schmitt said in a statement.

Sales at luxury department stores have suffered in recent weeks as the slowing economy and global financial crisis took a toll on even affluent shoppers, and the strengthening of the dollar deterred foreign tourists who had given high-end stores a boost in previous quarters.

Also in the basket:

McDonald’s profit tops view; shares rise (Reuters)

PepsiAmericas Q3 profit tops Wall Street view (Reuters)

Philip Morris, Reynolds profits beat Wall St view (Reuters)

Layaway plans make a comeback in credit crunch (WSJ)

(Photo/Reuters)

Check Out Macy’s slashing its 2008 profit outlook as it eyes the gathering storm clouds ahead.

Macy’s, which also runs the Bloomingdale’s chain, is the latest retailer to see consumers shy away from purchases of new fall clothes as they try to stay afloat in the economic downturn. Several clothing chains and department stores posted dismal September same-store sales earlier this week.

Macy’s same-store sales, or sales at stores open at least one year, fell 5.8 percent in August and September combined.  If trends remain weak, same-store sales could fall 3 percent to 6 percent for the entire fall season, Macy’s warned.  That’s well off its previous forecast for such sales to be flat to down 1 percent.

Also in the basket:

U.S. consumers lose faith in Fed, financial system

Takashimaya, H2O plan to merge in three years

Charming Shoppes lowers third-quarter outlook

(Photo: Reuters)

Christmas may be starting early for many retailers, but that isn’t the case at Starbucks.

While department stores like Macy’s are already in full holiday mode — hoping to get a jump on what is expected to be a dismal holiday season — the Seattle coffee shop chain is waiting until after Halloween and after Thanksgiving to serve up its holiday cheer.

Dorothy Kim, executive vice president of global strategy at Starbucks, said company executives had numerous discussions about when to roll out its holiday products, particularly since the economy is weak and this year’s holiday season has fewer shopping days than usual.

“We thought, ‘Let’s be courageous, let’s launch holiday after Thanksgiving’,” Kim said. “We have four weeks and we’re going to focus our efforts on that.”

The holiday season has traditionally been a very busy time for Starbucks, but Kim said succumbing to temptation and pushing holiday products too soon could have consequences: “You kind of get into this holiday fatigue.”

(Graphic: Starbucks)

Check Out Macy’s opening up shop in Dubai.

Two Bloomingdale’s department stores are scheduled to open in the United Arab Emirates’ largest city in February 2010. Macy’s, which owns the Bloomingdale’s chain, says the store’s merchandise and upscale ambiance will be similar to Bloomingdale’s in the U.S., while being ”sensitive to local preferences and customs” of the oil-rich states.

In another sign the Middle East remains a robust market for foreign retail brands, Kuwaiti retailer Villa Moda is partnering with the Dubai International Financial Center, which is owned by the Dubai government. The DIFC is buying a majority stake in Villa Moda, which operates seven multibrand shops in the Gulf region and offers high-luxury brands such as Gucci, Prada and Dolce & Gabbana. 

The two Bloomingdale’s, including a three-level clothing and accessories store and a one-level home store, will anchor The Dubai Mall, scheduled for completion later this year.

The stores will be managed and operated by Al Tayer Insignia, a company of Al Tayer Group, under a licensing agreement. Al Tayer Group operates in 12 countries in the Middle East and beyond and represents brands such as Harvey Nichols, Armani, Gucci, Emilio Pucci, Bvlgari and Boucheron, as well as stores such as Gap and Banana Republic.

Also check out:

JP Morgan cuts Buckle to neutral (Reuters)

JP Morgan starts coverage of 3 U.S. chicken producers (Reuters)

 (Photo/Reuters)

It’s Christmas already at Macy’s and yes, indeed, the holiday is on sale.

More than a month ahead of Halloween, the U.S. department store chain has dragged out its colorful collection of ornaments, baubles and beads and discounted the price by 25 percent.

Trees at Macy’s Holiday Lane Christmas shop in downtown San Francisco are festooned with themed ornaments. Besides the requisite trees covered in gingerbread, Santas, and holly, Macy’s offered up a lavender tree, a pink tree, a Hawaii tree, a tree with pink flamingos, a San Francisco-themed tree, a Martha Stewart tree and, yes, a Sex in the City tree (complete with ornaments resembling pink martini glasses and pink Eiffel Towers — a nod to Carrie’s last-season stay in Paris.)

Retail watchers expect this holiday season to be downright dismal in the United States, and some have predicted that it may be one of the worst on record, given the housing downturn, rising food and fuel costs, a weakening job market, and the credit crunch — not to mention headlines from Wall Street this week. 

Macy’s did not immediately return a phone call seeking comment on whether Christmas was coming just a bit early this year — maybe to reap a few early sales before the next shoe drops in the economy?

With the exception of a handful of Italian, German and British tourists looking for souvenirs, Holiday Lane shoppers were few and far between one Friday afternoon.

“We’ve got to have a Christmas ornament from Macy’s,” said British tourist Debbie Simmonds, browsing with her daughter, tour guide in hand.

Still, she balked at the $40 price tag on an elaborate Asian fish ornament and instead settled on a small gold crustacean for $22, passing on the pink poodle ornaments.

Noted Simmonds: “Why would you want a pink poodle on your Christmas tree?”     
 
(Photo: Alexandria Sage)  

What does gas at $4.50 a gallon mean for some mall-based department stores?

A downgrade by Goldman Sachs.

Goldman sharply raised its forecast for oil prices in the second half of this year, saying it expects U.S. crude to average $141 a barrel, up from a previous projection of $107. Goldman also forecasts prices will rise further next year to average $148.

That is not good news for retailers.

“Higher energy spending in the second half is likely setting the stage for a more challenging backdrop for consumer discretionary sectors, particularly for the department store stocks,” Goldman noted.

Goldman downgraded JC Penney and Nordstrom to ”neutral” from “buy.” It swapped its conviction list “buy” designation on Kohl’s with Wal-Mart. It upgraded off-price retailer TJX to “buy” from “neutral.”

Goldman also cut its second half same-store sales estimates for JC Penney, Kohl’s, Nordstrom and Macy’s.

“We believe companies will face an uphill battle against escalating energy prices offset by easier top-line compares and the anniversary of 2007’s extremely warm Fall season,” Goldman said about the second half of the year. ”In the end, we believe energy and constrained cash flow will win this tug-o-war causing same store sales to re-decelerate as the second half progresses.”
 
(Photo: Reuters) 

Check out Macy’s profit, or loss, depending on how you count.
 
The department store operator posted a $59 million loss in the first quarter, hurt by a drop in sales and the costs of restructuring.
 
So of course its stocks jumped.
 
Restructuring charges are seen by the investment community as “one-time items” and are generally disregarded when looking at how well a company did in any given quarter. 
 
So without ”one-time items” Macy’s posted a profit of 2 cents a share from continuing operations. That was better than the 2-cents-a-share loss that analysts expected.
 
Macy’s also affirmed its forecast for a profit of $1.85 to $2.15 a share for the year, possibly a sign that things at least are not getting worse for the company, which, like most department store operators, has been hurt by the slumping U.S. economy.
 
Of course, that forecast excludes “one-time” items.
 
Also in the basket:
 
Barney’s Socol quits, no clear successor (WWD)
 
Benetton Q1 profit, sales up, outlook confirmed

(Photo: Reuters)