Last week, Macy’s, Kohl’s and Wal-Mart all reported disappointing 2Q13 results–leading to worries that economic growth in the US is beginning to slow.  In Wal-Mart’s case, I think the problem is structural, not cyclical.  The manufacturing  jobs much of the chain’s lower-income customer base has traditionally had have disappeared forever.  With them, fat paychecks have gone as well.

But what about Macy’s and Kohl’s?  Why are their results so at odds with general economic indicators?

One possibility is that the weakness in general merchandise they’re exhibiting is a result of the housing boom.

In most areas of the world, and over most periods of time–except for the US during the past few decades–a cyclical housing boom alters consumers’ retail spending patterns.  The change usually appears with a modest time lag.

After buying a new residence, the owners typically redirect their spending in two ways:

–more of their income goes into paying their mortgage, and

–they redirect what remains toward furnishing and decorating their new home.

So spending on furniture, kitchen appliances, paint, carpeting… rises.  Spending on restaurants, cellphones, clothing… falls.  The latter category doesn’t drop to zero.  But consumers cut back–both on big-ticket items and on shopping-as-entertainment, where the items in question aren’t unique or special.

The only exception to this pattern that I’m aware of comes close to home.  During the long period when interest rates in the US were in decline–from the early Eighties until now–falling interest rates made housing prices rise so quickly that new homeowners weren’t forced to cut back on spending.  They could borrow against their fast-appreciating home equity, instead.

It’s too early to tell for sure, but the lackluster sales we’re seeing from Macy’s and Kohl’s may just be a return to normal by US homeowners after an extended period of excess.  If so, the situation is a threat to department store profits, and stock prices, but not to the overall economy or stock market.