Life in the real world: weak demand

This morning, the world’s largest retailer Wal-Mart confirmed that sales fell for the fourth straight quarter, and net sales growth for 2014 was trailing to the lower end of its previous forecast range. At the same time, Caterpillar–heavy equipment seller to the world and traditional barometer of US GDP–continues to defy the “demand is picking up” crowd. CAT’s sales decline led the global economy into recession in 2008 and issued a similar warning in 2013 as shown in this chart.

Data source: Not Jim Cramer.com
The Canadian dollar–canary in the global growth mine–seems to agree. After a reflex rally in the early part of February, the downturn towards fair value has resumed.