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Bricks-and-mortar retail sales were predicted to be down by 5% or so this year. At companies like Sears (SHLD), Gap (GPS), and Macy’s (M), which have been suffering for several quarters, the fall-off might drop into the low double-digits.

In November and early December, these estimates were holding up, but the last few days shopping activity has been crushed.

According to Bloomberg, "Customer visits to U.S. retailers fell 24 percent last weekend compared with a year earlier, the biggest drop on record, as deepened discounts failed to attract consumers." The figures were issued by research firm ShopperTrak RCT Corp.

Trying to understand a plunge of that magnitude is nearly impossible. It strengthens the concern that some of the weaker retail chains will simply disappear next year as their revolving credit lines hit their limits and they are left with hundreds of millions of dollars of unsold inventory which may be impossible to move out at any price in January.

The data also indicates that the contraction in consumer spending is accelerating. Job losses and the inability of most citizens to get credit may be forcing the retail customer into a hole, and he may not jump back out after Groundhog Day.

There may be a silver lining to the news. Five years of economic prosperity has allowed stores to open more outlets each year. Even relatively weak retailers could make a go of it as shoppers had tremendous access to credit because of the rising equity in their homes and bank lending practices.

The fall of retailers that never really had businesses that could survive outside of the most robust times will mean the firms which are left should face less competition for both customers and pricing. Watching the industry fail is a hell of a way to stay in business.

Douglas A. McIntyre