Now here's shocker. Wal-Mart Stores Inc. (WMT ), the world's largest retailer, reported that sales fell 2% in the fourth quarter compared to the same period last year. More bad news is on the way. Walmart also forecast a "challenging" first quarter.

All of the big guns at Walmart offered their reasons for the decline. Deflation in the price of groceries, which account for 40% of sales, was one factor. Price discounts in electronics and flat screen TVs were also cited.

Food stamps are pumping up revenue at retailers across the country. Costco (COST), Wal-Mart (WMT) and others are seeing rushes an hour before funds are credited to electronic benefits transfer cards. Wal-Mart's CFO, Tom Schoewe, has noted the trend, telling Reuters, "Once the clock strikes midnight [on the last day of the month] and EBT cards are charged, you can see our results start to tick up."

Spending via EBT is not only increasing, it generally happens quickly. JPMorgan (JPM), which runs EBT programs for more than 20 states, reports that buyers run through 85% of food stamp funds within the first three days of their availability.

At its annual two-day analyst meeting, Wal-Mart Stores, Inc. (NYSE:WMT) has outlined its plan for continued overall growth despite slower implied capital spending growth beyond next year. The plan was presented by Tom Schoewe, Wal-Mart Stores executive vice president and chief financial officer.

Global square footage is expected to increase by approximately 7.5% in fiscal 2008. The company also said that it estimates capital expenditures for its next fiscal year will grow at a significantly lower rate than spending for the current fiscal year.

"The Company projects its capital spending in fiscal 2008 to increase by approximately 2 to 4 percent, which compares to the 15 to 20 percent increase forecast for fiscal 2007," said CFO Schoewe.

Wal-Mart expects to open more than 600 new locations in the United States and around the world. The Company's expansion program will add approximately 60 million square feet next year through a variety of formats worldwide before any possible future acquisitions.

"We are still very committed to growth, but our real estate projects are now being subjected to a more rigorous prioritization process," explained Wal- Mart Vice Chairman John Menzer. "This store selection process will enable the Company to drive higher returns by focusing on locations that make the most efficient use of capital."

CFO Schoewe said that the company will continue growing through new unit expansion, acquisitions and same-store sales.

Jon Ogg is a partner in 24/7 Wall St., LLC; he does not own securities in the companies he covers.