The Anatomy of Global Economic Uncertainty

Mohamed A. El-Erian


NEWPORT BEACH – The sense of uncertainty prevailing in the West is palpable, and rightly so. People are worried about their futures, with a record number now fearing that their children may end up worse off than them. Unfortunately, things will become even more unsettling in the months ahead.

The United States is having difficulties returning its economy to the path of high growth and vigorous job creation. Thousands of people have taken to the streets of US cities, and thousands of others in Europe, to demand a fairer system. In the eurozone, financial crises have forced out two governments, replacing elected representative with appointed technocrats charged with restoring order. Concern about the institutional integrity of the eurozone key to the architecture of modern Europecontinues to mount.

This uncertainty extends beyond countries and regions. Those looking around the next corner also worry about the stability of an international economic order in which the difficulties faced by the system’s Western core are gradually eroding global public goods.

It is no coincidence that all of this is happening simultaneously. Each development, and certainly their occurrence in tandem, points to the historic paradigm changes shaping today’s global economy – and to the anxiety that comes with the loss of once-dependable anchors, be they economic and financial or social and political.

Restoring these anchors will take time. There is no game plan as of now, and historic precedents are only partly illuminating. Yet two things seem clear: different countries are opting, either by choice or necessity, for different outcomes; and the global system as a whole faces challenges in reconciling them.

Some changes will be evolutionary, taking many years to manifest themselves; others will be sudden and more disruptive. Yet, as complex as all of this sounds – and, by definition, paradigm changes are complicated affairs that, fortunately, seldom occur – a simple analytical framework may help shed light on what to look for, what to expect and where, and how best to adapt.

The framework relies on an often-used analytical shortcut: identifying a limited set of explanatory variables in what statisticians call “a reduced-form equation.” The objective is not to account for everything, but rather to pinpoint a small number of variables than can explain key factors, albeit neither perfectly nor fully.

Using this approach, it is possible to argue that the future of many Western economies, and that of the global economy, will be shaped by their ability to navigate four inter-related financial, economic, social, and political dynamics.

The first relates to balance sheets. Many Western economies must deal with the nasty legacy of years of excessive borrowing and leveraging; those, like Germany, that do not have this problem are linked to neighbors that do. Faced with this reality, different countries will opt for different de-leveraging options. Indeed, differentiation is already evident.

Some, like Greece, face such a parlous situation that it is difficult to imagine any outcome other than a traumatic default and further economic turmoil; and Greece is unlikely to be the only Western economy forced to restructure its debt. Others, like the United Kingdom, have moved quickly to take firmer control of their destiny, though their austerity drives will inevitably involve considerable sacrifices.

A third group, led by the US, has not yet made an explicit de-leveraging choice. Having more time, they are using the less visible, and much more gradual, path of “financial repression,” under which interest rates are forced down so that creditors, including those on modest fixed incomes, subsidize debtors.

De-leveraging is closely linked to the second variable – namely, economic growth. Simply put, the stronger a country’s ability to generate additional national income, the greater its ability to meet debt obligations while maintaining and enhancing citizens’ standards of living.

Many countries, including Italy and Spain, must overcome structural barriers to competitiveness, growth, and job creation through multi-year reforms of labor markets, pensions, housing, and economic governance. Some, like the US, can combine structural reforms with short-term demand stimulus. A few, led by Germany, are reaping the benefits of years of steadfast (and underappreciated) reforms.

But growth, while necessary, is insufficient by itself, given today’s high unemployment and the extent to which income and wealth inequalities have increased. Hence the third dynamic: the West is being challenged to deliver not just growth, but “inclusive growth,” which, most critically, involves greatersocial justice.”

Indeed, there is a deep sense that capitalism in the West has become unfair. Certain players, led by big banks, extracted huge profits during the boom, and avoided the deep losses that they deserved during the bust. Citizens no longer accept the argument that this unfortunate outcome reflects the banks’ special economic role. And why should they, given that record bailouts have not revived growth and employment?

Calls for a fairer system will not go away. If anything, they will spread and grow louder. The West has no choice but to strike a better balance – between capital and labor, between current and future generations, and between the financial sector and the real economy.

This leads to the final variable, the role of politicians and policymakers. It has become fashionable in both America and Europe to point to a debilitatinglack of leadership,” which underscores the extent to which an inherently complex paradigm change is straining traditional mindsets, processes, and governance systems.

Unlike emerging economies, Western countries are not well equipped to deal with structural and secular changes – and understandably so. After all, their histories – and certainly during what was mislabeled as the “Great Moderation” between 1980 and 2008– have been predominantly cyclical. The longer they fail to adjust, the greater the risks.
Those on the receiving end of these four dynamics – the vast majority of usneed not be paralyzed by uncertainty and anxiety. Instead, we can use this simple framework to monitor developments, learn from them, and adapt. Yes, there will still be volatility, unusual strains, and historically odd outcomes. But, remember, a global paradigm shift implies a significant change in opportunities, and not just risks.
Mohamed A. El-Erian is CEO and co-CIO of PIMCO, and author of When Markets Collide.

11/18/2011 05:55 PM

Debt Crisis Contagion

The Euro Zone's Deadly Domino Effect

A Commentary by Wolfgang Münchau

The euro-zone debt crisis is spreading to more and more countries. And politicians are reacting more helplessly than ever. Europe's leaders are underestimating the impact that a Greek exit from the common currency will have -- and are failing to learn from their own and others' mistakes.

Remember Henry Kissinger's domino theory? The former US secretary of state feared that the neighbors of a state that was under the control of the Soviet Union would also fall into Moscow's sphere of influence. Today, the theory that used to be applied to communism can be seen on the bond markets of Europe. The sovereign bonds of more and more euro-zone countries are coming under attack. Soon, one country after another might topple.

The reason for this desperate situation is the catastrophic crisis management in Europe. The German statesman Otto von Bismarck once said that only fools learned from their own mistakes -- he preferred to learn from the mistakes of others. At the moment, no politician or adviser in Europe has bothered to learn the lessons of the Argentine or Asian debt crises. Indeed, in Europe, they aren't even learning from their own mistakes.

The public chatter about a possible Greek exit from the euro zone is one example of how they are repeating their mistakes. In the summer, the impact of the participation of private investors in a debt restructuring was recklessly underestimated. Now, they are underestimating the consequences of Greece's leaving the common currency.

Broken Promises

Back in March, European leaders promised that all investments in Greek government bonds would be guaranteed until 2013. But, in July, they went ahead and negotiated the involvement of private investors in a Greek debt restructuring. The economic situation in the country had worsened, and the political mood in Germany had shifted. At the time, the European Central Bank (ECB) urged caution.

It argued that once you go down that road, you make investors nervous. As a compromise, euro-zone leaders agreed on the following formula: The terms of the participation of private investors in a so-called debt "haircut" would not be renegotiated, and it would certainly not be extended to other states.

In the following weeks, exactly what the ECB had feared happened. The interest rates on 10-year Italian bonds rose to 5 percent. And there was worse to come. In July, European leaders broke their promises from March. In October, they broke their promises from July. The participation of private investors would now be much higher, they decided.
Following that summit, investors came to the logical conclusion that politicians have basically been lying at euro summits. They surmised that, if the economic situation in Greece and the political mood in Germany changed, then the owners of Portuguese and Italian sovereign bonds would also be asked to contribute. In the meantime, even normal individuals are now withdrawing their savings from banks across southern Europe.
Exit Scenarios
In recent days, the crisis has expanded to France. The difference in interest rates between French sovereign bonds and benchmark German bonds -- the so-called spread -- has risen to record levels. France could soon be in same position that Italy is in today. Meanwhile, interest rates on Spanish 10-year bonds have hit their highest level since 1997. European bond markets are experiencing the domino effect.
Now ask yourself the following question: What will most likely happen if Greece leaves the euro zone? The answer is clear: We will see a domino effect in that respect, too. SPIEGEL reported earlier this week that the German Finance Ministry has come up with a number of scenarios to simulate what would happen were that to transpire. Those models make it clear to me that the German government still doesn't understand the mechanisms and momentum of this crisis.

The main problem of a Greek exit from the euro zone is not necessarily the direct impact on banks. I believe our government when they say that they would be able to get that under control. The real problem is the next domino. The crisis will spread unchecked to Italy. If Greece leaves the euro zone, then owners of Greek bonds will lose their entire investment. At best, the Greeks would pay them back a small part of their investment -- in almost worthless drachmas.
Crises Must Be Solved Quickly and Decisively

So what kind of investor in his or her right mind would purchase Portuguese, Spanish or Italian sovereign bonds in this kind of situation? Not even a yield of 7 percent can make up for all the risk that Italy won't be able to pay back its debt. As things now stand, Italy's debt accounts for 120 percent of its annual GDP, growth is close to zero and the country is currently slipping into a deep recession.

In fact, it's a matter of mathematical inevitability that Italy won't be able to service its loans if interest rates on its sovereign debt don't fall. Granted, there have to be reforms. But reforms don't resolve an acute debt crisis. We've already learned that lesson from other crises.

In the future, we will be forced to adjust our Greece program to a continuously worsening reality. At some point, this strategy of lying to ourselves will end in catastrophe: Greece's exit from the euro zone. There's no plan in place for such an eventuality. No one knows how a protective surge wall can be erected around the rest of the euro zone. If we are not sufficiently prepared, then we'll suddenly discover that Portugal is the next domino to fall.

In Germany, these matters will continue to be debated, commented upon and processed. Meanwhile the dominos will continue toppling. And that's the point when there will no longer be any alternative in Germany but to accept the unpopular euro bonds as well as the much more unpopular price guarantees via the ECB.

Indeed, one of the most important lessons to be drawn from the policies that Argentina followed during its currency crisis at the turn of the millennium is that -- one way or another -- crises have to be solved early and decisively. The longer one waits, the more expensive things get for everyone involved. But this lesson doesn't seem to be one that has been internalized by the German government, the European Union or the ECB.

In fact, Chancellor Merkel and her colleagues only take action when the markets have already started to panic. When that happens, all of the entreaties and pledges don't help a bit.

And, once the last domino falls, we can all kiss the euro goodbye.

November 17, 2011 10:43 pm

One professor to another: listen to the people, or fail

Ingram Pinn illustration: Angela Merkel

After economic default comes political default. Politicians in Greece and Italy have failed. Now it’s the technocrats’ turn.

Having been pummeled by the bond markets and disgraced by their own intrigues, the Greek political class has turned to Lucas Papademos while the Italians have turned to Mario Monti. Both are skilled and reputable economists, but a sceptic can be forgiven for asking: why should ordinary citizens trust them?

Both belong to the class of bankers and economists who dropped Europe into this mess in the first place. Both occupied commanding positions in European Union institutions that winked at a decade of Greek and Italian lies about their public finances. So why then are Greece and Italy turning to Eurocrats to pull them out? Because no one else has any authority left.

Technocrats are supposed to have the mysterious authority of being above politics. But there is no above politics”. The crisis is political all the way through.

The problems both countries face are not technocratic. The measures that must be taken are obvious enough: regain control of public finances, restart demand and make the two southern economies competitive again. The problem is political: how to push a reluctant bureaucracy to reform itself, how to corral parliamentarians into voting for tax increases, and how to persuade a hard-pressed people that the proposed sacrifices are fair and that there is light at the end of the tunnel.

As Greece has shown, if you can’t persuade people that austerity is fair, a country can become ungovernable. This is now the issue in southern Europe.

Mr Monti and Mr Papademos have to restore governability but neither has much political legitimacy. Neither came into office as a result of a popular vote, and if the technocrats fail, the political class will resume power sayingI told you so”. If the technocrats succeed, the political class will take the credit. Either way, the politicians think they will win and lead their countries back to their bad old ways.

Time is of the essence and neither man has much time. They will be opposed at every turn by public sector workers, employers and the bond market. These interests will try to wait them out or, failing that, drive the hardest possible bargain for their support.

Both men cultivate their “above politicsimage, but both are wily enough to know what they are up against. In a speech in Washington in April, Mr Papademos said the chief problem in Greece was not choosing an economic remedy but implementing it across the board.

The two leaders are counting on the inexorable facts of crisis to compel the public to support their austerity agendas. But while facts are stubborn things, they are not obvious. Greece and Italy would not be in the state they are in if the facts spoke for themselves. It will take immense political skill to persuade southern Europe that the facts are the facts.

Economic crisis has shown up, once again, the democratic deficit at the heart of the European project as a whole. The eurozone’s elected political class failed, for more than a decade, to tell voters what a common currency would cost. No politician dared to explain to the Greeks or the Italians, let alone Germans, the truth. The truth was that Italy and Greece were not competitive and were paying themselves more than they could afford. The German people were not told that a currency union transfers political and economic cost from profligate states to prudent ones like their own.

Mr Monti and Mr Papademos believe they can afford to tell their people the truth because, unlike politicians, they do not have to face an election. But repairing Italy and Greece will take a long time and, for that longer haul, technocratic legitimacy will not be enough. After half a century of the European experiment, political legitimacy remains what it is in every democracy: incorrigibly national, local and political.

It must be earned at the ballot box. Turning to experts to solve problems of legitimacy and consent is a sign, not of strength, but weakness. After Mr Monti and Mr Papademos, Europe will need elected politicians who earn their legitimacy the hard way, by telling the people the truth.

For the moment, it is a good sign that Mr Monti is being calledthe professor”. It’s an indication that the people want him to succeed. Having been a professor myself and having done my time in politics, I would offer only one piece of advice: convince your people that you are doing this not for the banks, not for Europe, not for the bond market, but for them, your fellow countrymen and women. Remember they, not the bond market or the European Union, have the ultimate power. If they believe you are on their side, you can succeed. If they believe you are not on their side, you will fail and they can make your country ungovernable.
The writer is a former Canadian politician now teaching at the University of Toronto
Copyright The Financial Times Limited 2011.

Sorry, Santa Won't Be Staying

The surge in consumer spending has been propelled by a reduction in Americans' savings rate. The trend won't go on forever. Neither will the rise in retailers' stocks.


Santa came early to investors in retail stocks this year. The shares have easily outpaced the broad market, propelled by strong earnings and sales, despite high unemployment and dour consumer sentiment. But as Black Friday and 2012's dawn approach, retail stocks face a tougher time.

Comparisons get much more difficult, and the positive trends that boosted spending at retailers by almost 6%, on average, this year might not recur. At best, the stocks could respond by stalling for the next few quarters. At worst, they could be setting up for a nasty fall.

CONSUMERS FINANCED their 2011 spending spree by sharply reducing their savings rate. A reduction of equal size this year is highly unlikely; it would bring savings down to almost nothing in an environment where the prices of homesmost Americans' largest asset—are depressed, stocks are volatile and consumers remain concerned about the economy, their personal finances and their jobs.

"It's not a sustainable condition," asserts Neil Dutta, U.S. economist at Bank of America Merrill Lynch. "I think consumer spending will soften next year."
In recent weeks, that spending was helped by gasoline prices that fell after moving up this summer.

However, prices at the pump are about to creep higher again; just last week, oil shot above $100 a barrel for the first time since mid-July. In addition, consumers could be facing higher federal taxes next year as politicians try to boost revenue to help trim the federal budget deficit. In a number of ways, the situation is exactly the opposite of what Barron's found last year when, in an article that proved accurate, we predicted that spending during the Christmas season would be surprisingly strong ("Off to the Mall," Nov. 22, 2010).

While yes, Virginia, Santa will arrive this year, holiday sales may come in at the low end of, or slightly below, expectations. The National Retail Federation has one of the most anemic forecasts around. It expects holiday sales—excluding outlays for autos, gasoline and meals at restaurants—to rise 2.8%, compared with 5.2% in 2010.

"Though several economic indicators paint a solid picture for the holiday season, including 14 consecutive months of retail sales growth and a substantial reduction in household debt, continued consumer uncertainty over the stock market, higher gas and food prices, fiscal policy and sputtering job growth will impact spending," says an NRF news release. And it observes: "Additionally, the substantial year-over-year gains for the 2010 holiday season will create more difficult comparisons for retailers to achieve this year."

Most of the analysts Barron's spoke with believe the market anticipates a rise in sales of 3% to 4%. One of the more optimistic estimates comes from Customer Growth Partners, a consulting and research group, which predicts a 6.5% rise, thanks to pent-up demand and a financially healthier consumer.

Even slight disappointments might have a big impact because the stocks of many retail chains—especially those catering to the wealthy—have rallied sharply, inflating their valuations. The Standard & Poor's retail index is up 14% over the past 52 weeks, while the S&P 500 has gained a mere 3%.

So far the rise in retailing stocks has been accompanied by increasing expectations for strong earnings growth. The profits of retailers in the S&P 500 are expected to climb 18% this year but just 14% in 2012, according to Bespoke Investment Group.

"Retail stocks went to all-time new relative highs," says Jim Paulsen, the chief investment strategist at Wells Capital Management. Retail shares have outperformed the broader index for most of the past three years. While he believes that consumer spending will remain strong next year as job growth and real incomes improve, he maintains that retail stocks could still underperform because they have priced in so much potential good news. And, if any negative surprises crop up, the shares could really slump.

Paulsen is recommending that investors buy shares of groups that have been disappointing this year, such as industrial, basic-material and emerging-market stocks.

THE STOCK-MARKET SHOWING by clothiers and retailers catering to the well-heeled has been particularly impressive. Over the past 52 weeks, Ralph Lauren (ticker: RL) has surged 41%, Coach (COH) has jumped 17%, while Tiffany (TIF) has advanced 35%.

As their shares have risen, their price/earnings ratios have improved, too. Ralph Lauren's stock, recently at $148, trades at 18.5 times analysts' profit estimate for calendar-year 2012. Tiffany shares, around $75, are in the same neighborhood, with a multiple that sparkles at almost 18 times. Coach, at $61.47, is slightly more reasonable with a 16.2 multiple, but the multiples of all three are far above the S&P 500's 11.8.
Well-positioned retailers focused on middle- and lower-income consumers have also fared well. Costco Wholesale (COST) has jumped 22% over the past 52 weeks. Bargain shoppers love TJX (TJX) and its shareholders do, too, after its stock's 30% increase. And Dollar Tree (DLTR) and Dollar General (DG) may cater to those with low incomes, but they have given shareholders rich rewards, with the stocks up 39% and 32%, respectively.

Given this preholiday euphoria, caution—if not outright profit-taking—is warranted. "Everything that we look at points to a deceleration here, and the risk of external shocks has increased," observes Steven Wieting, a U.S. economist at Citigroup Global Markets. As a result, he sees growth in chain-store sales slowing from 4.5%, year-over-year, in the third quarter, to 2.5% to 3%.

Wieting notes that employment improvement has been negligible and that nominal income gains decelerated from a 4.5% annual clip in the first quarter to 3.3% in the third. As a result, consumers have been funding their higher spending out of their savings, a major point of concern for the future.

THE SAVINGS RATE, which hit a high of 8.3% of disposable income in May 2008, has rapidly fallen; it was 3.6% in September, the last month for which data are available. That means that over the past year, consumers have reduced the amount they save annually by roughly $200 billion. And, unless consumers become comfortable again with having little in the bank—as they were four years ago, when real-estate prices were soaring and consumers could tap into the gains by selling their houses or taking out home-equity loans—this isn't likely to continue.

"I think the last three to four months, we've been living on borrowed time," says Colin McGranahan, a Sanford Bernstein retailing analyst. In a recent report, he wrote that the "current 3.6% savings rate appears to be abnormally low, relative to household wealth. While this doesn't necessarily presage a 'reversion to the mean,' it does suggest that the current consumer spending behavior is significantly at odds versus historical norms."

The analyst says that household net worth has a meaningful inverse relationship with the savings rate. And based on the current state of that measure, he estimates that the savings rate should be 5.3%, where it stood in June.

The only time the savings rate was so far below the expected rate was in the mid- 2000s when homeowners were taking equity out of their homes. A return to 5.3% would decrease consumer spending by about $200 billion a year and cut consumer spending growth by 1.8 percentage points.

Bank of America Merrill Lynch's Dutta argues that there are more reasons now than ever before for the savings rate to be higher.

Boomers need to work longer and save more for retirement. Young people don't believe that Social Security will be around for them, so they need to save more. And, he adds, unemployment is high, so those with jobs may want to save more for fear that they will join the ranks of the jobless.

In fact, it's the rare person who wasn't shaken—and awakened to the importance of having a substantial nest egg—during the 2008-2009 financial crisis, when it sometimes appeared that the global economy would collapse.

Dutta believes that as incomes improve, the savings rate will increase, ultimately to 7% to 8% by 2015. "There's a higher rate of precautionary savings needed," he concludes.

For the spending surge to continue, consumer incomes would have to rise, through higher wages, lower unemployment or both. And while that's possible, it isn't likely anytime soon, given the slow economic expansion widely expected. In fact, after-tax incomes could actually decrease for a while, as local and federal governments continue to scramble for ways to boost revenue.

The tax cuts instituted under former President George W. Bush are set to expire at the end of 2012.

While Congress might preserve the cuts to the lower- and middle- income tax brackets, it's likely that the top bracket may return to 39.6%, versus today's 35%. Polls have shown widespread support for increasing taxes on the wealthiest part of the population, and politicians do like to keep their jobs. But such an increase, warns BOA's Dutta, would drain $50 billion a year from higher-income pocketbooks.

Payroll-tax cuts also are set to expire at the end of this year. If they aren't extended, consumers would have $90 billion less to potentially spend. At the same time, extended unemployment benefits, which increased the number of weeks one can receive jobless payments from 26 weeks to 99 weeks, also could be halted. That would eliminate $40 billion of yearly government payments that have helped bolster consumer spending, Dutta adds.

The elevated costs of gasoline and groceries, at least by historical standards, could also drain consumer purchasing power. After average U.S. gas prices hit almost $4 a gallon in May, they drifted lower for most of the summer, bottoming in early October at $3.42. Since then, prices have plateaued.

The national average at the pump stood at $3.44 last week, but is likely to creep higher now that the price of crude oil is bouncing around $100 a barrel.

Likewise, food prices have been rising this year. In October they were up 4.7% from a year ago.

Kimberly Greenberger, an analyst at Morgan Stanley, downgraded Coach, Tiffany and Nordstrom (JWN) shares recently to Equal Weight from Overweight, after strong runs brought them near her price targets.

Greenberger doesn't recommend exiting from the industry entirely. She has kept an Overweight rating on Macy's (M), which has been gaining market share, thanks to a focus on local preferences. Despite posting strong earnings growth, the chain continues to trade at a price/earnings multiple below the market's at 9.6 times, based on expected $3.16 in calendar 2012 earnings. Greenberger's target on the stock is $35.

RECENT DISAPPOINTING RESULTS at Urban Outfitters (URBN) have sent its shares almost 27% lower this E3WDSS. But, Greenberger wrote in a recent report, the stock's price doesn't reflect the company's five-year 12% compounded annual growth rate per-square-foot story and so is worthy of an Overweight rating. She also likes Ann Taylor (ANN), which she expects to gain market share, but which is down 13% from the start of 2011.

Certainly, pessimism about the retailers' stocks could be early. As the holiday season approaches, spending momentum has continued. Last week, the Census Bureau reported that October retail sales, excluding autos, food and gas were 5.4% above the year-earlier figure. And if consumers keep spending, businesses could become confident enough to hire more people. Last week, for the second week in a row, unemployment claims fell below 400,000.

"You're fighting the tape to be negative on these names," warns Patrick McKeever, an analyst at MKM Partners. Retailers have cut costs and inventories to remain profitable, even in this slow-growth environment, he says.

McKeever, who does expect retail sales to increase 3% to 4% over the holidays, has Outperform ratings on TJX, Target (TGT), Kohl's (KSS), DSW (DSW), and Ross Stores (ROST).

Yes, the tape has been positive for retailers, but only because consumers are spending money they should be saving. That trend soon is likely to end. So, anyone contemplating buying the stocks should heed retailing's ancient maxim: Buyer beware. 
Recent 52-Wk 12-Mo EPS * EPS * P/E*
Company/Ticker Price High-Low % Chg 2011E 2012E 2012E
Coach / COH $61.47 $69.20 - $45.70 17.0% $3.18 $3.80 16.2
Costco Wholesale / COST 81.98 86.34 - 64.57 22.3 3.39 3.99 20.6
Dollar General / DG 39.06 40.71 - 26.65 31.5 2.29 2.63 14.8
Dollar Tree / DLTR 76.27 82.49 - 48.51 39.4 3.95 4.64 16.4
Family Dollar Stores / FDO 56.02 60.53 - 41.31 15.7 3.22 3.74 15.0
Home Depot / HD 37.62 39.38 - 28.13 22.0 2.38 2.72 13.8
Kohl's / KSS 54.97 58.00 - 42.14 4.1 4.48 5.23 10.5
Macy's / M 30.42 32.67 - 21.69 23.4 2.77 3.16 9.6
Ralph Lauren / RL 148.22 164.55 - 101.83 40.6 6.84 8.00 18.5
Tiffany / TIF 74.94 84.49 - 54.20 34.6 3.71 4.18 17.9
TJXCompanies / TJX 59.18 61.71 - 42.55 30.4 3.97 4.46 13.3

S&P 500
1216.13 1,371 - 1,075 3.2 96.28 103 11.8

*On a calendar-year basis. E=Estimate.
Source: Thomson Reuters
Copyright 2011 Dow Jones & Company, Inc. All Rights Reserved