Each week the CEO of Avondale Asset Management, Scott Krisiloff, publishes some of his observations from commentary provided by public company executives during earnings calls. Despite expectations for the usual rosy outlooks, Krisiloff notes that he was surprised to find that "comments from consumer facing businesses were somewhat troubling."

In particular, among the large consumer-facing businesses, both McDonalds and Brinker (Chili's) warned of reduced discretionary expenditures by consumers on the back of "broader macroeconomic issues of consumer confidence" and a "slight squeeze" on consumer budgets with gas and healthcare costs rising. Meanwhile, staffing giant Robert Half noted that seasonal upticks in hiring generally experienced in September and October failed to materialize this year.

Visa (Payments):“On the negative side, the global economy is not improving. Geopolitical tensions are high. The U.S. election is a wild card, and we continue to watch the impact of Brexit. ”

McDonald's (Fast Food):“I think there are broader macroeconomic issues of consumer confidence and just uncertainty of wage increases, the slight squeeze on discretionary spend with gas prices aging back up and healthcare costs going back up. So, I think those are sort of things that we see affecting customers and basically the spare cash they have in their pocket”

“In Canada…We now have dual point service and self-order kiosks in almost 90% of our traditional restaurants.”

Brinker (Casual Dining):“Just as we said last quarter, these continue to be challenging times across casual dining. We’re already seeing some of the weaker players struggle with their viability in this choppy environment… there are some examples of concepts that are shrinking.”

DuPont (Chemicals):“I mean, it looks like all forecasts say that housing is dropping off…not significant, but it looks like there’s a little bit of a rollover off of kind of that 1.1 million to 1.2 million starts…And then on the auto side of the business, it looks like auto builds are going to be down in the couple percent range going into next year.”

Catepillar (Equipment OEM):“The decline for construction is particularly North America…The problem we find ourselves in, I think, isthe larger projects, the infrastructure, the infrastructure spending is maybe not quite as robust as housing would be right now, and that’s a bigger sweet spot for us.”

Robert Half (Staffing):  “in September, we didn’t see the lift we typically get, instead, it was sequentially about flat. And then again, traditionally we get even more lift yet again in October and we didn’t see that lift either…clearly [clients] remain cautious with little sense of urgency. It’s in part due to macro uncertainty, in part due to election uncertainty. They cite budget pressures, they cite cost control measures… the general trends that I described also apply to tech…which is where we had seen most of our growth, that’s now where our growth is most under pressure…I’d say Accountemps we saw more softness in the accounting operations positions and those are the ones that are typically more client demand sensitive, more client volume sensitive. So it’s consistent that if you were to see softness in accounting due to macro conditions you’d see it in accounting operations”

Simon Property Group (Mall REIT):“I think what unfortunately what I think a number of retailers, they’ve not invested in their product, okay. Or they’ve chased the holy-grail of internet sales to the detriment of what they should be doing with the physical product, as still people want to go physical shopping. And when they go physical shopping, you’ve got to have a nice physical environment.”

UPS (Logistics):“when you look at the ecommerce market, it could be one in five or one out of every six packages that are shipped to a consumer get returned…Those packages are highly profitable. First of all, many of those packages get dropped off and don’t have to be picked up because the consumer finds it more convenient to drop them off at UPS stores or UPS Access Points or hand them to a UPS driver. So there’s very little cost when it comes to pick-up. And then obviously, the deliveries are going back to businesses, and we could be delivering tens or hundreds of packages back to these businesses. So it’s a highly profitable B2B delivery with very little pick-up cost.”