(Editor's note: Updates to reflect today's earnings releases from Kohl's and Nordstrom.)
BOSTON ( TheStreet Ratings) -- The term "trade down" became a familiar phrase in the investment lexicon after the credit crisis struck the U.S. in 2008.
Trade down, in reference to the retail industry, refers to consumers choosing lower-priced, discounted goods, as compared with higher-end items. Americans, hobbled by surging unemployment, high gasoline prices, investment losses and depressed home prices, were forced to cut back.
Teens who usually assembled a wardrobe at Abercrombie & Fitch (ANF) were searching for back-to-school clothes at Aeropostale (ARO). Their parents, who might have been used to dressing up at J.Crew (JCG) and The Gap's (GPS) Banana Republic were heading to TJMaxx (TJX) or The Gap's Old Navy to save a few bucks. Starbucks (SBUX) frappucinos and lattes weren't selling as well, as many stopped splurging, opting for the java jolt from their -- gasp -- household coffee maker.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV