Tag Archives: Retail Sales

America’s Twisted Pretzel Economy, by David Stockman

Posted on July 21, 2021 | Leave a comment

Debt and central banking have distorted the American economy beyond all resemblance to the world-beater it once was. From David Stockman at davidstockmanscontracorner.com via lewrockwell.com:

June retail sales allegedly rose at a booming +15.6% YoY rate, thereby reminding us once again that just because you can look it up on Bloomberg doesn’t make it true. Actually, inflation-adjusted retail sales have fallen at a –13.5% annual rate since the March peak.

Then again, the March peak was an out-of-this-world aberration that underscores just how bollixed economic life has become as a result of Dr. Fauci and the Virus Patrol shutting down the great engine of the US economy last March-April, followed by a mindless compensatory bacchanalia of spending, borrowing and printing by Washington’s Infernal Inflation Machine.

One result of that madness was a cumulative 60 million layoffs and food lines for miles in many parts of the country, accompanied by the most explosive consumer spending surge ever recorded. In the equivalent of a children’s “which things don’t go together” quiz, that combo ranks in the no-brainer category.

Yet, it did happen. The March 2021 retail spending level was 42.6% above the April 2020 bottom in real terms. More importantly, it also stood 19.1% above the February 2020 level, which, of course, was recorded before the boot heels of Dr. Fauci’s minions came crashing down on the US economy.

Here’s the thing. It happens that this 19.1% pickup in monthly retail sales (excluding restaurants and bars) amounted to nearly $340 billion in constant dollar terms. In the scheme of things that’s one hell of a big number because it represents the entire increase in inflation-adjusted retail sales between February 2003 and February 2020.

That’s right. The tsunami of Washington stimmies and free stuff plus the lockdown of services venues caused a gain in retail sales for goods over the course of just 13 months that was equal to the prior 17 years of real growth.

Continue reading→

Leave a comment

Posted in Banking, Business, Debt, Economics, Economy, Financial markets, Government

Tagged , , , ,

Peter Schiff: Americans Are Broke

Posted on March 15, 2018 | Leave a comment

Americans aren’t spending much because they don’t have much money. From Peter Schiff at schiffgold.com:

Retail sales unexpectedly fell again in February. It was the third straight monthly drop and the first time the US economy has seen three straight months of declining retail sales since 2012.

Sales fell 0.1% in February. Analysts had expected an uptick of 0.3%. According to CNBC, households cut back on purchases of motor vehicles and other big-ticket items, pointing to a slowdown in economic growth in the first quarter.

So, why is this happening? Peter Schiff offered a simple reason in his latest podcast.

Americans are broke.

There was another sign of trouble. Inventory numbers also indicate people aren’t buying what’s on the shelves. According to the Commerce Department, business inventories rose 0.6% on the heels of a 6% rise in December.

Of course, on Friday, we got the “too good to be true” Goldilocks jobs report. Peter said this doesn’t make sense.

So why didn’t any of those million people take their paychecks and spend them at a retailer? I mean, Trump is talking about all the great jobs, and all the raises that people have, and all the tax cuts. Why are retail sales down for three months in a row?”

Again, the most obvious and simple explanation is Americans are broke.

Retail sales were pretty hot during the last months of 2017, before falling off in December. But we also saw Americans running up record high levels of debt at the same time.

Last month, the New York Fed released the latest data on US household debt, revealing it has grown to a record $13 trillion. So yes, Americans have been spending, but they’ve been putting a lot of it on plastic. Credit card balances grew by $24 billion in the last quarter of 2017 alone.  Could it be that Americans have maxed out the plastic?

At some point, a house of credit cards will collapse.

Peter also noted that the Atlanta Fed has once again lowered its GDP forecast for the first quarter of this year. Remember earlier in the year when they were talking about 5.4% growth? Well, now they’ve lowered that bar all the way down to 1.9%.

To continue reading: Peter Schiff: Americans Are Broke

Leave a comment

Posted in Business, Debt, Economy

Tagged

Retail Sales, Inflation Add Fuel to Fed’s Rate-Hike Trajectory, Treasuries Dive as Yields Surge, by Wolf Richter

Posted on February 14, 2018 | Leave a comment

The world was short Treasuries and the world was rewarded with stronger than expected stats on inflation and retail sales that sent bond prices down and yields up. 

But something funny happened on the way to the headlines.

In describing the retail-sales data released today, words like “slumps” and “declines” kept cropping up in the headlines. This referred to the seasonally adjusted month-over-month data, so the percentage change from December retail sales (peak holiday selling season) to January retail sales (peak merchandise-return season). This comparison is only possible with gigantic seasonal adjustments that try to smooth away the holiday selling peak and the post-holiday hangover in a way that, hopefully, the index ticks up a bit from December to January.

In today’s reading, this change in seasonally adjusted total retail sales – includes food services and drinking places such as restaurants and bars – ticked down 0.3% from December to January, triggering the “slumps” and “declines” in the headlines. But this figure is only as good as the seasonal adjustments. Here is what the month-over-month percentage change of total retail sales looks like not seasonally adjusted:

Not seasonally adjusted, total retail sales plunged 21% from December to January, but they plunged between 19% and 23% in prior Januaries. Hence the gigantic seasonal adjustments needed to smoothen out this wildly gyrating seasonal data.

But on a not-seasonally-adjusted basis, the year-over-year growth in total retail sales was a healthy 5.1% in January, compared to January 2017, in the same range of the year-over-year changes in prior months and at the higher end of the spectrum since 2012:

There was only tepid growth in the bar-and-restaurant business, with sales of food services up only 1.8% year-over-year. Excluding food services, retail sales jumped 5.6% year-over-year not seasonally adjusted:

To continue reading: Retail Sales, Inflation Add Fuel to Fed’s Rate-Hike Trajectory, Treasuries Dive as Yields Surge

Leave a comment

Posted in Business, Debt, Economy, Financial markets

Tagged ,

Worse Than a Decade of Stagnation, by Wolf Richter

Posted on February 18, 2017 | Leave a comment

SLL has long maintained that the economy is in much worse shape than indicated by official statistics. With President Trump taking office, it’s a good bet the numbers will catch up with reality. From Wolf Richter at wolfstreet.com:

Retail sales are held up by only two sectors. The rest are sinking.

There are two components of “retail and food services sales” that have been booming over the past few years through the fourth quarter 2016. And then there’s all the rest combined – 71% of total retail sales – that has been in decline since the third quarter of 2008. That’s the tough reality of retail sales in the US.

First the good news: e-commerce sales

In the fourth quarter, e-commerce sales soared 14.3% from a year earlier, to $123.6 billion, not adjusted for seasonality and price changes, according to the Commerce Department today. E-commerce sales for the entire year 2016 jumped 15.1% year-over-year to $394.9 billion, accounting for 8.1% of total retail and food services sales, up from 7.3% in 2015. You see where this is going.

E-commerce sales include online sales by retailers with brick-and-mortar stores, such as Walmart and Macy’s that are all trying to carve out a presence on the internet, with varying success.

This chart uses seasonally adjusted e-commerce sales to eliminate the very large seasonal fluctuations, including the spike every Q4 and plunge every Q1, but it’s not adjusted for inflation:

While e-commerce soared 14.3% year-over-year in Q4, total retail and food services sales, including e-commerce, rose only 3.9%. In all of 2016, total retail sales edged up only 2.9% from 2015. So what is left over once e-commerce is removed from the equation?

To continue reading: Worse Than a Decade of Stagnation

 

Leave a comment

Posted in Business, Economy, Uncategorized

Tagged ,

Why is the MSM Covering Up Recessionary Data, by Jim Quinn

Posted on April 14, 2016 | Leave a comment

You would think that when the government’s own data confirm what most people know—we’re sliding into a recession—the toady MSM would report it, but they don’t. It might interfere with the Clinton coronation, you understand. From Jim Quinn at theburningplatform.com:

The Census Bureau put out their monthly retail sales report this morning. During good times, the MSM would be hailing the tremendous increases as proof the consumer was flush with cash and all was well with the economy. Considering 70% of our GDP is dependent upon consumer spending, you would think this data point would be pretty important in judging how well Americans are really doing.

It’s not perfect, because the issuance of debt to consumers to purchase autos, furniture, appliances and electronics can juice the retail sales numbers and create the false impression of strength. That’s what has been going on with auto sales for the last two years.

The retail sales figures have been propped up by the issuance of subprime auto loans to deadbeats, 7 year 0% interest loans to good credit customers, and an all-time high in leases (aka 3 year rentals). Despite this Fed induced auto loan scheme, retail sales have still been pitiful, as the average American has been left with stagnant wages, 0% interest on their minuscule savings, surging rent and home prices, and drastic increases in their healthcare costs due to Obamacare.

The retail sales for March, reported this morning, were disastrous and further confirmed a myriad of other economic indicators that the country is in recession. GDP for the first quarter will be negative. And this time they can’t blame it on snow in the winter. They have already doubly seasonally adjusted the figures, and they will still be negative. Retail sales in the first quarter were atrocious. It might make a critical thinking person question the establishment storyline of solid job growth being peddled by politicians and their MSM mouthpieces. If people had good paying jobs, they would be spending money.

The Ivy League educated “expert” economists expected March retail sales to increase by 0.1%. They only missed by $6 billion, as retail sales FELL by 0.3%. They have fallen for three straight months. At least gasoline sales were strong, as prices have risen 22% since mid-February. That should do wonders for the finances of American households. If you exclude gasoline sales, retail sales fell by 0.4%. As the chart below reveals, the year over year change in retail sales has been at or near recessionary levels for most of 2015, and into 2016.

To continue reading: Why is the MSM Covering Up Recessionary Data

Leave a comment

Posted in Business, Media

Tagged ,

Five-Year Retail Boom in Texas Implodes, by Wolf Richter

Posted on February 18, 2016 | Leave a comment

From Wolf Richter at wolfstreet.com:

The Oil Bust Bites.

Retail sales in Texas were a boom machine after March 2010, their low point during the Great Recession. It lasted over five years. Sales tax collections, reported by the Texas Comptroller of Public Accounts, jumped 46% from the first half of 2010 to the first half of 2015. Blinding growth for a mature market!

Given the size of the Texas economy, it helped prop up overall retail sales in the US.

But by mid-2015, the retail sales boom came to a screeching halt. In the second half, sharp year-over-year declines set in. And in December, over the crucial holiday period, retail sales sagged.

Sales tax collections aren’t an ideal gauge. Basic food products like flour, sugar, bread, milk, eggs, fruits, or vegetables are exempt. Taxes on motor vehicle sales and rentals are not included in this tally but are reported separately. The data is not seasonally adjusted, so it can only be compared to the same months in prior years. But it’s an unvarnished approximation of the movements of retail sales.

Sales tax collections lag sales one month. So collections reported for January were for sales in December.

June and August 2015 were the first months since March 2010 when sales tax collections actually declined year over year. They were considered outliers. Then in October, sales tax collections plunged 5.4% year-over-year. In November, collections fell 3.3%, in December 1.0%, and in January 3.9%.

Since sales tax collections lag sales one month, that 3.9% drop for January was for December sales. What a sour holiday period!

This chart by “David in Texas” shows how the boom in sales tax collections since the Great Recession began to sag last year. I circled the months of year-over-year declines (yellow = 2014, green = 2015, dark blue = 2016):

The chart also shows just how phenomenal the retail sales boom in Texas was. It coincided with the oil boom, when West Texas Intermediate traded above $100 a barrel for part of the time, when fracking became the new miracle activity that brought billions of dollars from banks and investors from around the world into the state every year.

To continue reading: Five-Year Retail Boom in Texas Implodes

Leave a comment

Posted in Business, Economy, Energy

Tagged ,

Something Rotten Is Piling Up in this Economy, by Wolf Richter

Posted on February 13, 2015 | Leave a comment

From Wolf Richter, at wolfstreet.com:

Total US business inventories balloon to Lehman-Moment levels

“We do have more work to do in the US,” admitted John Bryant, CEO of Kellogg’s which makes Pringles, Pop Tarts, Kashi Cereal, and a million other things that consumers are increasingly reluctant or unable to buy. He was trying to explain the crummy quarterly results and the big-fat operating loss of $422 million, along with a lousy outlook that sent its stock careening down 4.5% during the rest of the day.

Then in the evening, ConAgra, with brands like Healthy Choice for consumers and something yummy they call “commercial food” for restaurants, cut its fiscal 2015 earnings guidance, citing a laundry list of problems, including the “strengthening dollar” and “a higher-than-planned mark-to-market loss from certain commodity index hedges.” But it blamed two operating issues “for the majority of the EPS cut: “a highly competitive bidding environment” and “execution shortfalls.”

After which confession time still wasn’t over: it would be “evaluating the need” for additional write-offs. What had gone well? Cost cutting – “strong SG&A efficiencies,” the statement called it. But the pandemic cost-cutting by corporate America represents wages and other companies’ sales.

It’s tough out there for companies that have to deal with the over-indebted, under-employed, strung-out American consumers with fickle loyalties and finicky tastes, who have been subjected to this corporate cost-cutting for years.

And so retail sales, according to the Commerce Department, dropped a seasonally adjusted 0.8% in January. That’s on top of a 0.9% decline in December. The hitherto inconceivable is happening: folks are saving money on gas, but not everyone is immediately spending all that money! It’s so inconceivable that I warned about it and other effects of the oil price crash two months ago: “Wall Street promises a big boost to US GDP,” I wrote. “What have these folks been smoking?”

But even excluding gasoline sales, retail sales were flat last month after edging down 0.2% in December. And sure, some of the savings from gasoline will be spent eventually, but there are plenty of Americans with enough money left over every month to where their spending patterns aren’t influenced by the price of gas.

But this report, an advance estimate that is subject to potentially large revisions, covers only spending at retailers and restaurants, a portion of total consumer spending, which includes healthcare and anything else that consumers pay out of their noses for. And year-over-year, retail sales actually rose 3.3%, with food services sales up 11.3%, auto sales up 10.7% thanks to prodigious subprime financing, while sales at gas stations sagged 23.5%.

So from just the retail sales report, the consumer situation remains murky.

But there is another gauge that is moving deeper and deeper into the red. It has been deteriorating consistently since last summer. A couple of days ago, I reported that wholesale inventories were ballooning in relationship to sales, a red flag in our era when just-in-time delivery and lean inventories have been honed into an art to minimize how much working capital and physical space gets tied up. The crucial inventories-to-sales ratio for wholesalers had reached the highest level since the financial crisis.

http://wolfstreet.com/2015/02/13/something-rotten-is-piling-up-in-this-economy/

To continue reading: Something Rotten Is Piling Up in this Economy

Leave a comment

Posted in Business, Economics, Financial markets, Other Views

Tagged ,