Retail Sales Up 1.6%, Auto Purchases Surge By 7.5%, Electronics Sales Decline By 1.3%

Tyler Durden's picture

From the Census Bureau:

The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for March, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $363.2 billion, an increase of 1.6 percent (±0.5%) from the previous month and 7.6 percent (±0.5%) above March 2009. Total sales for the January through March 2010 period were up 5.5 percent (±0.3%) from the same period a year ago. The January to February 2010 percent change was revised from +0.3 percent (±0.5%)* to +0.5 percent (±0.3%).
Retail trade sales were up 1.8 percent (±0.5%) from February 2010 and 8.2 percent (±0.5%) above last year. Gasoline stations sales were up 26.4 percent (±1.5%) from March 2009 and motor vehicle and parts dealers sales were up 14.1 percent (±2.5%) from last year.

The biggest component to the increase in March was the traditionally noisy and excluded Motor Vehicle and Parts Dealers, which increased from $53.4 billion to $69.9 billion. What we find surprising is that in light of all the rage over tech, sales at Electronic and Appliance Stores declined by -1.3% from $8.4 billion to $8.3 billion. How this is possible with ever increasing "strategic" mortgage defaults is beyond us. We can't wait to see the latest consumer savings rate data.

Other notable changes from February:

  • Food services & drinking places: 0.1%
  • Grocery stores: 0.1%
  • Clothing & clothing accessories stores: 2.3%
  • Building material & garden eq. & supplies dealers: 3.1%

Full Census report

 

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ZackAttack's picture

Survivorship bias... Mom & pop retailers that aren't counted are folding up, driving business to the better-capitalized Big Box stores that are.

Otherwise, it's difficult to explain how sales tax receipts remain flat to negative.

Why, in an environment of 17% unemployment, anyone would buy anything other than basic necessities, is a complete mystery to me, though.  

docj's picture

Otherwise, it's difficult to explain how sales tax receipts remain flat to negative.

Ding!  It's not difficult - it's impossible.

Census Bureau == Bureau of Making Shit Up

Jeff Lebowski's picture

Other notable changes from February

Business days in March increase 15% to 23 days from 20 days in February.

 

gratefultraveller's picture

If you're hooked on electronic junk and the "games" it supplies it is hard to kick the habit, you might only see those sales drop once the "bread" part of the equation becomes unaffordable.

MrPalladium's picture

An effect of rising import prices.

Also the result of March seasonal adjustment not taking into account record income tax refunds - a one off event.

Let them all fail's picture

Which by the way will continue, I am receiving an absolutely ridiculous 62% of my federal taxes back - I plan on saving all of that other than paying off a couple bills which might take up 20% of it, but others will probably not be so frugal...

JackTheTrader's picture

Could it be that Americans learned nothing over the past 2 years and have already returned to debt buying consumption?  Or is this just a short term bump as people replace their torn overhauls?

Headbanger's picture

Ironically all those increasing "strategic" mortgage defaults may be giving consumers  more disposable income to spend on dining out, the supermarket, clothing, etc. Or this bogus stock market rally may be the impetus for more retail spending. Still the employment and earnings numbers are bleak so yea the savings rate must be getting lower.

Racer's picture

I will say it again, ABC consumer confidence fell from -43 to -47

so how can advance retail sales be sooooo good?

Dixie Normous's picture

Two Words: Census Bureau

Racer's picture

another con, like the bls figures!

Zexe's picture

What I find surprsing is how completely biased to the negatives Zerohedge is....can't you just admit these are OK numbers (not necessarily good, but OK).

 

I think you are losing credibility by refusing to admint that there are signs of stabilizing and improvement in the real economy.

cbaba's picture

nope, these are real spending but this is due to morgage defaults, now if you dont pay morgage then you have a lot of money in your hand to spend.

This is what happening, this is more scary than anything else, people are hopeless.using their last bullets.

 

 

Zexe's picture

Ok, I know this explanation is fashionable...and even if it was true, then what? people don't pay their mortgages, banks foreclose on them and they rent a home. Big deal. The rest of the economy will be working just fine, in the end there had to come a time when the economy would wean itself off housing.

Real Wealth's picture
by Zexe

 

Ok, I know this explanation is fashionable...and even if it was true, then what? people don't pay their mortgages, banks foreclose on them and they rent a home. Big deal.

 

   Unless there is a lot of equity to seize, banks are not foreclosing on people who have long had no intention of ever paying their mortgages again.  If they foreclose the house just sits there, gets vandalized, stripped of copper, etc.  Letting loan deadbeats stay in the house, free of rent, is cheaper.

whatsinaname's picture

Zexe, In 1971 when the Fed still abided by the gold standard and credit was "worshippen", there were less than 1 % of American men and women in US prisons. By 2009/10 those numbers were 10% for men and 7% for women in jail. How is that a recovery ? What kind of mother(land) wants to see 10% of its able bodied men and women decaying in jail. Something is fatally wrong somewhere. And guess what curves for M3 money supply and prisoner population correlate exactly between 1925-2009 !! Things got worse after 1982 when the stupid 401k programs started.

http://en.wikipedia.org/wiki/File:Incarceration_rate_of_inmates_incarcerated_under_state_and_federal_jurisdiction_per_100,000_population_1925-2008.png

http://en.wikipedia.org/wiki/File:US_incarceration_timeline-clean.svg

 

Seer's picture

Read the Financial Armageddon article linked above.  Basically it's like this (item #2 given in the comments section):

1) People have more "disposable" income due to halting mortgage payments (many still living in their homes for a year w/o paying);

2) Income tax refunds.

I'd also point out that, as another ZH article notes (or is it This one? too much activity to keep up!), there are 15% more business days in March than in April.

Anyone know whether "retail" sales figures include liquidations of consumer products (i.e. bankruptcy processing)?

sumo's picture

Landlords have signs out saying "bad credit accepted".

So if your mortgage is, say, 6% of property value, but renting costs 3%, and bad credit is no obstacle ...

http://online.wsj.com/article/SB126040517376983621.html

http://www.ft.com/cms/s/0/a93abcea-1fe7-11df-8deb-00144feab49a.html

hedgeless_horseman's picture


Zexe, clearly you do not know of The Prophecy.  It says, "There shall come a blog that brings balance to The Force."

I will tell you that here in Texas it's all good, mostly.  However, any of you unemployed deadbeats, aspiring astronauts, fucktards, libs, neo-cons, queers wanting to get hitched, foreigners, Cali junk dealers, market manipulators, traders, traitors, revenuers, dealers, Hawaiian-sons-of-African-goat-herders, circus acts, ex-DJs, lawyers, old sick people, and welfare octo-moms might want to stay away.  Greener pastures await you on either coast.

However, faith healers, cowboys, sons-of-oil-rich-Arabs, wetbacks, and pole dancers seem to still be welcome in the Lone Star State, according to my analysis of data leaked from the new census.

 

spekulatn's picture

 

However, any of you unemployed deadbeats, aspiring astronauts, fucktards, libs, neo-cons, queers wanting to get hitched, foreigners, Cali junk dealers, market manipulators, traders, traitors, revenuers, dealers, Hawaiian-sons-of-African-goat-herders, circus acts, ex-DJs, lawyers, old sick people, and welfare octo-moms might want to stay away.  Greener pastures await you on either coast.

 

Well done.

Village Idiot's picture

What about rain-makers and "forked - stick - water - finder" experts? 

Dixie Normous's picture

Oh please, stabilizing and improvement in the real economy?

The past 15 years have been a failed experiment in giving massive amounts of credit to a populous with declining earnings power.  Now it's time to pay up.

We are still not anywhere near the edge of the forest, getting out of the woods ain't gonna happen anytime soon.

There is no credibility loss a ZH because they take a skeptical view of "data" produced by the government.  Maybe if people had been doing that over the years, the economy wouldn't be in such a mess.

Postal's picture

...there are signs of stabilizing and improvement in the real economy.

Circa March 1930?

I'm 40 years old, college degree in engineering, and I have NEVER had the good fortune of being part of any "boom" as discussed by the MSM. From my own experiences, I see ZH as exposing the truth about the world economy, and providing some insight as to why my personal experience isn't what the news indicates it should be.

Jeff Lebowski's picture

I'll get your back.  39 with a BSc mechanical.  Married, one child, Chicago area.  Work in the capital goods (large fabricated equipment) for foundries, recycling, renewable energy, and mining serving the domestic and international arenas.  After 7 years as a design engineer, made the move to contract sales and working at the same company for 16 years.

Things have never been worse, stimulus money meant nothing.  I make less than I did in 1999 after our sales compensation was eliminated, then salaries cut.  It's only a matter of time before I move on or the doors close and/or a domestic managing staff will relocate efforts to China or India as our competitors are doing. 

Side note:  The average Joe thread - I'm one of those assholes that bought a house that was well below my means of living, before my salary was cut to the point that I'm now month to month and running in the red when large bills come due.  Thanks to my storing nuts in the good years (something sales guys figure out rather quickly when you're commission based), we're making it, but dying the death of a thousand cuts.  The comments on that thread spoke volumes of lack of life experience.

There's seem to be a lot of new faces here at ZH as of late - and I get the feeling that they are of college or recent grad age.

Gwynplaine's picture
Gwynplaine (not verified) Jeff Lebowski Apr 14, 2010 12:46 PM

Jeff, I'm 35 with a BS in metallurgy and a MBA in marketing.   I've worked for several years in sales/marketing positions, but never experienced any demand for my engineering skills.  Since last year, I've been studying IT - hoping that it will turn out somehow.

You are not alone.  Best wishes for you and your family.

poor fella's picture

*raising hand* - BS in computer science. Worked with a team that was 85% H1b (at the time I didn't realize what that was). Even that was 'too expensive' so they closed up shop. Outsourced 2 more times so figured I gotta get 'on the ground' do some physical work. Became I.T. lone ranger doing EVERYTHING (setting up routers, microwave, pulling voice/data, setting up retail stores, writing software modules and tools, scripting, etc.) - IBM pitches cost savings by having Chindiazil do 'remote support' so 50% of I.T. was let go. IBM's solution is practically worthless unless you need a password reset. Turnaround on issues is now over a week when they can find subcontractors to fumble around at $10/hr...  this story could go on and on. Not sure how companies expect any kind of dedication these days. The race to the bottom accelerates. If anyone needs a lawn mowed, shed built, or house painted, call me up. Will relocate for general landscaping opportunity.

Postal's picture

I feel for ya. The g/f's complaint is that for as bad as IT is needed, management won't pay for it. "Hire cheap" is key, just to say they have the staff on-hand--staff who can't get a Security+ cert. Sad. Glad I'm learning Chinese...

JuicyTheAnimal's picture

Computer science degree.  10 years exeperience.  (Well actually 8 considering I was unemployed for almost 2 out of first 10).   Saw all the off shoring and the H1Bs in house.   Never had a good stable job although was paid quite well at a few gigs.  Mostly contract stuff.  Now work for a company that sells pig snot to bullshitters and pays me what the internet says is entry level pay for a computer programmer.  This company is doing a little better than last year but I suspect it won't last. 

I might be one of the guys that helped retail figures.  I bought my girlfriend a pair of hiking boots from TJ Max and myself an oven mit and an aprin from Bed Bath and Beyond.  But only afforded because I have extra cash from not paying my mortgage for the last 15 months.

 

 

 

 

Postal's picture

TJ Max has hiking boots? Gonna have to look into that as I'm working to "store nuts" and other emergency and disaster preparedness stuff.

docj's picture

... there are signs of stabilizing and improvement in the real economy.

We eagerly await your recitation of what, precisely, they are.

glenlloyd's picture

When you've been lied to for so many years it's easy to have a negative bias. When your tax dollars are going to save institutions that should have failed it's easy to have a negative bias....catch the direction I'm going with on this?

I'm perfectly willing to accept good information, but I don't see it. Making up shit is not real good information, and where I live it doesn't look all that good.

And as was mentioned just about the beginning of this it's hard to see where increased sales come from when the sales tax receipts aren't climbing. It suggests that people are 1) buying internet and avoiding sales tax or 2) the number are being concocted by the Census bureau.

ZackAttack's picture

I don't recall expressing anything terribly negative. I'm just asking the question: How can one reconcile an increase in retail sales to flat-or-falling state sales tax receipts?

 

As one poster indicated, sales tax receipts may be a lagging indictor. In this case, we should see confirmation of this in the next state sales tax reports. It is an empirical hypothesis.

 

My theory is that it's survivorship bias.

 

I'd just like to see this disparity explained.

HarryWanger's picture

Obviously, people who can spend money are spending. It's pretty clear. I have to admit, the economy is much stronger than I would have anticipated at this point. My goodness, look at Apple, they can't even keep products in supply. Crazy but it looks like reality now.

jdrose1985's picture

Even a comatose patient twitches and gives other hopeful signs of life from time to time. Take it from a lower class member...things are rough out here. AAPL and INTC are not indicators of the so called real economy. These Midwestern towns are dead. Try telling the masses of unemployed how strong the economy is…get out of your cozy den and take a look at the real world.

Its tough out here and people are scared shitless.

Dixie Normous's picture

People who can't really afford to spend money have also always spent money.

Firms like Apple and the cellphone-texting legions are the direct benficiary of this mentality and a perfect microcosm of the US: people with little or no money, shipping dollars overseas to purchase stuff they really don't need but must have the latest and greatest version of.

 

unwashedmass's picture

 

"not adjusted for prices" says it all.

cbaba's picture

It all makes sence :

http://www.financialarmageddon.com/2010/04/it-makes-sense.html

 

People send more on their cars, other expenses because they can afford now after defaulting their morgages.

 

ghostfaceinvestah's picture

It's actually more pronounced than that - people are buying cars BECAUSE they default on their mortgage.

It works like this: people know their credit will get trashed after they default.  But auto loans are fixed rate.  So they buy the car, THEN default.

I am seeing this a lot.  To me, the increase in auto sales is a sign defaults are about to increase.  This makes sense given the government recently increased the incentives to default.

PierreLegrand's picture

If you aren't paying your mortgage you have lots of money to  spend on other things...like hair, cell phones, flat screens and bling.

Herne the Hunter's picture

Let's not forget that US population increases 1% each year. Adding inflation (especially energy prices), in real terms per capita, you'd see something much lower.

trillion_dollar_deficit's picture

In addition to the idea that people aren't paying their mortgages, I think you can also throw in the idea that the two stimuli have increased the number of people who don't pay any income taxes by almost 25% (38% in 2007 to 47% in 2009).

ACjourneyman's picture

Hey, it is easy to buy crap when you no longer are paying your mortgage or property tax. if I was in a Mcmansion and knew I was going to lose it or Bumbama was going to make the Heloc payment go away, I too would spend,spend ,spend, mine would be on gold though.

JuicyTheAnimal's picture

When you buy gold it is not called "spending".  That is called "saving" in my book. 

Jake3463's picture

I simply just say bullshit.  They are lying.  Sales Tax revenue tells a different story.

HarryWanger's picture

ABK back in fashion again today. The craziness never ends!

stoverny's picture

As I've noted before, the answer is in the Citigroup "Plutonomy" memo.  Yes the average person is still getting hosed.  Yes the jobs are gone forever.  Yes people are still losing their homes and their savings.  Yes retirement will soon be a thing of the past.

It doesn't matter.  The top 5% are doing better than ever, and their consumption is what matters to the stats.  How can retail sales go up when unemployment hasn't budged and whatever home equity people had is gone?  Easy.  The wealthiest have made huge gains in their stock portfolios and they have free money from the Fed to burn.

The goal was never to help "main street" as our consumption has little effect on the overall economics stats.  The goal was to save the wealthiest from collapse so that they could keep spending and drive the statistics upwards.  Then the govt can use the stats to claim "recovery" and hope the rest of us buy into it, therefore keeping the unwashed masses from breaking out the pitchforks against the elites. 

Seer's picture

The top tier are investing, not buying a bunch more consumer products (yes, perhaps they are buying a bit more, but in no way could they raise the levels in the face of decline by the largest consumer class on earth).