Thursday morning headlines

Retail sluggishness: Yes, there was plenty of action at the malls last weekend, but apparently it wasn't enough to offset all those empty stores during the first half of November. The result: 54 percent of the retailers surveyed by Thomson Financial reported that November same-store sales had fallen short of expectations. Wal-Mart, Costco and Penney were in that group (more on Wal-Mart in the next item). Federated Department Stores, which owns the Macy's colossus, was one of the biggest surprises, with an 8.5 percent jump in same-store sales. Wall Street expected 4.8 percent. Among the locals, City of Industry-based Hot Topic fell 4.3 percent (analysts had forecast 6.7 percent), while OC's Pacific Sunwear of California fell 3.8 percent (forecast was 4.6 percent). By the way, the market is down this morning.

What's the matter with Wal-Mart?: The retail giant that just a couple of years ago could do no wrong is suddenly doing very little right - at least based on its projection that December same-store sales would be up only 1 percent, perhaps less. The company talks vaguely about "continued challenges in our apparel and home business," but this morning's NYT takes a closer look at what's ailing the company. The basic problem is that the old formula - stacking low-cost merchandise to the ceiling and opening lots and lots of new stores - won't work anymore because a)Target and the others are doing the low-cost thing better; and b)because those new stores are starting to take business away from the old stores. Not helping matters is an ongoing renovation effort, which has made the stores tougher to navigate. From the NYT:

Several weeks ago, H. Lee Scott Jr., the chief executive of Wal-Mart, told analysts that he was “surprised that the disruption that occurred during the remodels was as extensive as it has been.” The new clothing at Wal-Mart created problems, too. After early success with a designer women’s clothing line called Metro7 in 600 mostly urban area stores, the company rolled out the fashions across the chain. It did not work. The average Wal-Mart shopper lives in the suburbs, is roughly 5-foot-2 and wears a size 14 — making them poor candidates for the skinny jeans that were a popular, tight-fitting fashion in urban markets. "I would never buy dress clothes here," said Ms. Shepherd, who shops at the Wal-Mart in Midvale, Utah, twice a week for staples like toothpaste, batteries, underwear and socks.

Malibu's mass merchant: Also in the NYT is a profile of Nina Garduno, whose Free City Supershop defies easy description, other than being a hodge-podge of bicycles, T-shirts and customized teepees. Garduno is a strange bird - she is still VP for men's fashion at RonHerman/Fred Segal, but apparently has this thing for out-of-the-ordinary items, often handmade, that you might not find in another store. From the NYT:

If fashion executives were to look beyond the granola rhetoric of Laurel Canyon circa 1975, beyond the $140 T-shirts with mystical-sounding phrases like “Texas Tokyo,” they may be forced to admit that Ms. Garduno is in fact very instinctual, that her ideas are prescient. They may even have to ask why the fashion industry has not been able to create a new shopping experience equal in its fun and sense of surprise to that of Whole Foods or Apple, but which is available in 800 square feet in a strip mall in Malibu. According to Ms. Garduno, Free City is profitable. It took her eight days, working with a shoestring budget and a small team in her workshop in Hollywood, to create the store’s interior, which features redwood shelves and blowups of album covers. Like everything else about Free City, the design follows Ms. Garduno’s mantra to “make things with the simplest elements with the highest of possibilities.”

Actress pay: Tops on THR's list of most well-paid actresses is Nicole Kidman, at between $16 million and $17 million. Right behind her are Reese Witherspoon, Renee Zellweger, Drew Barrymore and Cameron Diaz, all at $15 million. After that come Halle Berry ($14 million), Charlize Theron and Angelina Jolie ($10 million), Kirsten Dunst ($8 million-$10 million) and Jennifer Aniston ($8 million). I know it's a published list and we're supposed to simply accept these numbers as gospel, but Halle Berry at $14 million? And of all those on the list, Aniston seems the most bankable (witness "The Breakup," which made more than $100 million).

Avocado squeeze: You mean to say that Kraft doesn't use much avocado in its Guacamole! We're shocked, shocked! The LAT is calling it a controversy, but it's actually just a Los Angeles woman who has filed a silly lawsuit that accuses Kraft of committing fraud. Here's my favorite line of the story: "If consumers read the fine print, they would discover that Kraft Dips Guacamole contains less than 2 percent avocado. But few of them do." Right - and so because some idiot shoppers choose not to read the label Kraft is supposed to fork over a bunch of money. The fact that the woman lives in Los Angeles, where guacamole awareness is surely higher than in other parts of the country, makes this all the more ludicrous. (And judging by this morning's coverage, it's the talker of the day.) From the LAT:

Brenda Lifsey, the plaintiff, said she made a three-layer dip with Kraft guacamole last year only to discover that it contained almost none of the ingredient she most expected: avocado. "It just didn't taste avocadoey," said Lifsey, who identified herself as a federal employee who lives in Los Angeles. "I looked at the ingredients and found there was almost no avocado in it."

Miaramar saga: The storied Santa Barbara hotel is on the market - again. Beanie Baby billionaire Ty Warner is putting the place up for sale because his spokesman says community groups are making it difficult for him to undertake a bunch of renovations. You might remember that Warner bought the Miramar from New York hotelier Ian Schrager, who couldn't come up with the bucks for his renovations.

HMO rates going up: Premiums are catching up with what the rest of the nation has been shelling out, according to a study by the California HealthCare Federation. Out-of-pocket expenses are also going up. Half of California workers with health insurance get care through HMOs, which are networks of hospitals and doctors. Nationwide that rate is just one in five.

DirecTV after Dish customers: The El Segundo-based satellite service is going after the Dish Network subscribers who will be losing out on some network channels because of a court ruling. The offer includes $150 cash back, plus other perks such as free equipment, installation and DVR upgrade.