You have a natural winner off the lower gasoline price getting hammered, as is Dollar Tree (DLTR - Get Report) (which is now able to focus again on operations after flirting with Family Dollar (FDO) ). And you have a natural winner off the higher stock prices we have experienced, Tiffany (TIF - Get Report) , also getting completely trashed. It's so darned confusing because while no one expected really good numbers out of Europe and China, everyone expected Tiffany to report a strong U.S. It turned out to be the opposite.
And the biggest winner of the disposable income windfall from gasoline is the dollar segment, but there was so much hot money in Dollar General (DG - Get Report) , I guess there was no hope at all. I think it is a buy, but who cares?
We get that Dollar General wanted a shot at all of those Family Dollar stores because it is such a better operator, but the overlap turned out to be about four times bigger than we thought, at least according to the Federal Trade Commission. No wonder they wanted it so badly.
But what the heck is Tiffany's excuse? I don't even know. CNBC's Carl Quintanilla speculated that perhaps tourism isn't as abundant as we thought because of the strong dollar. I am wondering if it isn't plain old execution.
We need answers; we don't have them.
Maybe it's just that expectations got too high for all retailers, especially after the good quarter from J.C. Penney (JCP - Get Report) . That did in Macy's (M - Get Report) , which really wasn't that bad at all, but it benefited Urban Outfitters (URBN - Get Report) , which has been on a tear because it was expected to miss. It was behind the very nice pop in Pier One (PIR - Get Report) , which finally got that comp-store number back to the high single digits. And it helped Lululemon, where the expectations had been slashed and slashed and slashed to oblivion, and it beat oblivion.
Of course, every single retail miss is now being attributed to over-exuberance over oil and gasoline. This kind of analysis is exactly the opposite of last week, where we excused pretty much everything but Bed Bath and Five Below.
I think that's the wrong takeaway. I totally believe in the group, but you have to be able to capitalize off the lower oil as Penney did and I believe Dollar General will do, which is why I still painfully like it.
But it is worth noting that you need a combination of the give-up on current management and heavy number slashes by retail analysts before you can call a bottom. As predicted, we already have three reiterations of buys on SanDisk (SNDK) . These stocks die hard!
Editor's Note: This article was originally published at 12:45 p.m. EST on Real Money on Jan. 12.