Scott Shellady, veteran trader, market commentator, bank executive, and the founder of The Cow Guy, told Fox Business on Tuesday that declining dollar store earnings indicate a recession.

Both Dollar Tree and Dollar General’s shares have plummeted in recent days. 

“While middle and higher income households are seeking value as well, they don’t claim to feel the same level of pressure as low-income households, as customers have felt more pressure on their spending,” Dollar General CEO Todd Vasos said on a post-earnings call.

The disappointing earnings were just “another reminder of the headwinds facing the core low to middle income consumer,” said Michael Montani and Greg Melich, analysts for Evercore ISI.

Shellady said consumers don’t have anything left to spend.

“We have a problem where … the consumer is basically tapped and run out of money … What that leads to is … the Fed would like to help them, I think, by trying to cut interest rates — however fast that helps them that’s a whole other story — but at the same time they have to worry about inflation. … You can’t ignore the fact that mom and pop on Main Street are really hurting,” Shellady said.

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Despite President Joe Biden and Vice President Kamala Harris insisting that their economic policies are working, Americans continue to suffer. 

Like declining dollar store revenue, sausage sales speak volumes about the economy. 

“As the economy weakens, we are seeing modest growth in our category of dinner sausage,” the Federal Reserve Bank of Dallas noted in a comment just days ago. “This category tends to grow when the economy weakens, as sausage is a good protein substitute for higher-priced proteins and can ‘stretch’ consumers’ food budgets.”

“We are preparing for the recession,” one food manufacturer told the Dallas Fed. 

Fox Business has more details from its interview with The Cow Guy. Here’s the start of the story:

Struggling dollar stores is a sign of bad news for the U.S. economy, RFD-TV’s Scott Shellady said Tuesday.

“It’s one of those things you just can’t ignore as much as a lot of people would like to,” Shellady told FOX Business’ Stuart Varney as he floated the possibility of an upcoming recession.

“When you think about it, their target market is $30,000 to $45,000 earnings per year. Those people have basically stopped going or at least not spending what they used to spend. Even the CFO of Darden Restaurants, which is the Olive Garden, they’ve said that they’ve seen a decent amount of revenues, but it’s from people that make over $200,000; their target market [is] between $70,000 and $80,000 a year. As far as what their customers are, they’ve dropped off the face of the Earth.”

Stores like Dollar General, Family Dollar and Dollar Tree have taken hits lately, with the latter of the three struggling to meet expectations despite selling most discounted items at $1.25 apiece.

Dollar Tree’s shares tumbled last week after the company revised its annual outlook, with the change being attributed to pressure on its lower- and middle-income customers.