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March Retail Slide, Miss Expectations, Post Biggest Drop Since June

Tyler Durden's picture




 

Add retail sales to the ongoing economic US crunch, which, just as predicted here in February, would start taking place once the regular seasonal adjustment rotation out of the "strong" winter season into spring started and once the now annual European swoon in the spring spread to the US, as it always does.

Sure enough, March retail sales missed across the board, with headline down -0.4% (exp. 0.0%, Feb revised lower to 1.0%), ex autos down -0.4% as well (exp. 0.0%, last 1.0%), and ex autos and gas -0.1, on expectations of a +0.3%. This was the biggest miss ex autos since June and the biggest drop since June as well. More troubling perhaps for the true strength of the US consumer, electronics sales dumped -3.2% Y/Y (confirms the collapse in PC sales reported yesterday), while general merchandise sales declined by 4.9% year over year. As we have said all along, the US consumer - that very levered driver of 70% of US GDP - even when factoring in the trillion + in student loans, is getting very much tapped out. But at least car sales, funded by the still very generous Federal Reserve and Uncle Sam, of course, are merrily chugging along at a +6.5% Y/Y pace.

 

And a breakdown by sale category:

Cue scapegoating of the weather, Easter, sequester and Cyprus any second now...

And of course, if this doesn't send the S&P to new all time highs, nothing can goose this ridiculous, manipulated market.

 

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Fri, 04/12/2013 - 08:52 | 3440185 TeamDepends
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And the DOW's at an all-time high!  Time to get IN!

Fri, 04/12/2013 - 09:05 | 3440229 GetZeeGold
GetZeeGold's picture

 

 

Bullish for stawks!

 

Use the power of the normalcy bias force.

Fri, 04/12/2013 - 09:18 | 3440311 TeamDepends
TeamDepends's picture

It is truly shocking, isn't it?  "Can't happen here/again."

Fri, 04/12/2013 - 09:09 | 3440265 Bearwagon
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FTMFW!

Fri, 04/12/2013 - 10:01 | 3440498 mdtrader
mdtrader's picture

They all rushed into equities just in time for the correction!

Fri, 04/12/2013 - 08:53 | 3440189 pods
pods's picture

Fucking El Nino!

Or is it La Nina?

pods

 

Fri, 04/12/2013 - 08:53 | 3440190 Shizzmoney
Shizzmoney's picture

Lets buy some houses and stocks, guys!

I mean they can't bullshit forever, can they? 

Fri, 04/12/2013 - 08:55 | 3440193 New England Patriot
New England Patriot's picture

That's okay. Americans have enough extra crap to last for years. 

Fri, 04/12/2013 - 08:54 | 3440194 fonzannoon
fonzannoon's picture

"I fucking told you so!"

 - ex walmart email guy

Fri, 04/12/2013 - 08:55 | 3440205 Cursive
Cursive's picture

@fonzannoon

You made me laugh out loud again.  Would be totally awesome to set up a twitter account for the "ex walmart email guy".

Fri, 04/12/2013 - 08:57 | 3440218 fonzannoon
fonzannoon's picture

That would be awesome. ADR is just as good.

Fri, 04/12/2013 - 09:16 | 3440310 Jason T
Jason T's picture

having him tweet that would be gold .. gold jerry.

Fri, 04/12/2013 - 09:20 | 3440318 Headbanger
Headbanger's picture

Good one!   Would love to see "Ex-WalMart E-Mail Guy" do a funny YouTube video saying that

Fri, 04/12/2013 - 09:03 | 3440195 Cursive
Cursive's picture

Fuck you Windows 8!  You are ruining the economy!  /sarc

 

ETA:  I'm sure the talking point on CNBS will be a faulty seasonal adjustment for the early Easter.

Fri, 04/12/2013 - 08:56 | 3440200 B2u
B2u's picture

No risk.  Time to leverage more into stocks !!!

Fri, 04/12/2013 - 08:56 | 3440208 d edwards
d edwards's picture

The 0blama steath depression continues.

Fri, 04/12/2013 - 09:09 | 3440258 GetZeeGold
GetZeeGold's picture

 

 

Which explains the steath boom in modern sporting rifles and ammo?

Fri, 04/12/2013 - 09:10 | 3440279 ptoemmes
ptoemmes's picture

Good point.  They report "ex autos" - gotta wonder about "ex firearms".

Fri, 04/12/2013 - 09:18 | 3440305 GetZeeGold
GetZeeGold's picture

 

 

I have a friend that works for an ammo manufacturer. 60 hour work week is mandatory.

Fri, 04/12/2013 - 09:21 | 3440321 pods
pods's picture

And some are fighting back.  PTR91 is moving from the God forsaken dump they are in.
Now having them in NC, that would be nice.

pods 

Fri, 04/12/2013 - 09:43 | 3440414 kw2012
kw2012's picture

That 3.0% will be 1.5% by the time the revisions are done. Meanwhile, packaging at the grocery stores continue to shrink, but not the prices.

 

The only deflation I see anymore if flat panel tv's and even they seem to have stopped dropping.

Fri, 04/12/2013 - 09:47 | 3440448 new game
new game's picture

so i should sell my blazer 9mm 350 packs? at 175 per up only 90 percent, hmm, tough decisions

oh, thats right i'm in for the long haul...

Fri, 04/12/2013 - 08:56 | 3440212 Confundido
Confundido's picture

The positive, mainstream view: "The 0.4% m/m fall in US retail sales in March won’t stop annualised real consumption from rising by between 2.5% and 3.0% in the first quarter, but it does suggest that growth in the second quarter will be more lacklustre. Gasoline station sales and auto sales both fell, by 2.2% m/m and 0.6% respectively. And building materials sales rose by just 0.1%. More important was the 0.2% drop in sales of all other items. This was worse than our forecast of a 0.3% rise and was the first fall since sales were hit by Superstorm Sandy in October. The prospect of annualised real consumption in the first quarter of between 2.5% and 3.0% is weaker than the 3.0% to 3.5% we previously estimtated. Overall GDP may still have risen by close to 3.0%, though. It is perhaps telling that a lot of the weakness in March was in sales of discretionary items – electronics fells by 1.6%, leisure goods dipped by 0.8% and department store sales dropped by 1.1%. This suggests that the payroll tax hike and previous leap in gasoline prices is forcing households to pull back. Coming on the back of the weakening in the ISM surveys and payrolls data in March, the economy appears to have lost some momentum. But with gasoline prices now falling, we don’t expect too sharp a slowdown."

 

All is well, folks. Nothing to see here. Move on! Come on, move on!

Fri, 04/12/2013 - 09:00 | 3440220 Dr. Engali
Dr. Engali's picture

When you walk into a Walmart on Friday night and you have cashiers hanging out in front of their check out lines chatting while they wait for somebody to cash out, you know things are going to be bad.

Fri, 04/12/2013 - 09:16 | 3440300 Smegley Wanxalot
Smegley Wanxalot's picture

Actually, it's doubly bad if you need to go to Walmart on a Friday night to look for chicks.

Fri, 04/12/2013 - 09:30 | 3440357 adr
adr's picture

Hey, those chicks with EBT probably make more than you do. Sugar Welfare Mommas.

Fri, 04/12/2013 - 09:36 | 3440381 Hubbs
Hubbs's picture

I've noticed this too at my local Wal Mart. Would be interesting to check up the volume of shoppers  at midnight at the end of the month with the EBT reload.

Fri, 04/12/2013 - 09:46 | 3440433 Doyle Hargraves
Doyle Hargraves's picture

It used to be horrendously long lines around here at the end of the month (I work swing shift so I got to see it), Now 2 out of the 4 Wal Marts here where I am at close at midnight instead of 24/7 operation. Kind of interesting considering SoCal is the welfare hub of the nation, why would the world's biggest retailer NOT want to make money ASAP before shoppers could blow it on drugs, alcohol, and strippers?!

Fri, 04/12/2013 - 14:15 | 3441972 Disenchanted
Disenchanted's picture

Probably more "shrink" at those 2 locations than sales during those night time hours...

Are they in what could be termed dangerous areas, or high crime hoods?

Fri, 04/12/2013 - 09:01 | 3440230 Headbanger
Headbanger's picture

Wonder how much worse it is ex-firearm sales?

Fri, 04/12/2013 - 09:36 | 3440388 kw2012
kw2012's picture

Ahahaha Good One! 35 sold a minute, that's about 1 billion a month if you assume a very modest $600 per purchase.

Fri, 04/12/2013 - 09:00 | 3440231 Smegley Wanxalot
Smegley Wanxalot's picture

Retail sales would explode if the Bernank would only print more money.  Fuck you, Ben, for being so stingy with the ink.

Fri, 04/12/2013 - 09:01 | 3440238 The Dancer
The Dancer's picture

and now wholesale prices down .6%....deflationary....gold down $30....deflation 1st and then mega-printing....

Fri, 04/12/2013 - 09:06 | 3440253 orangedrinkandchips
orangedrinkandchips's picture

Kevin Henry has PUT IN THE BOTTOM.....BTFD....

 

 

 

Fri, 04/12/2013 - 09:39 | 3440398 Doyle Hargraves
Doyle Hargraves's picture

Cannot wait until that stands for something else...Beat The F*ck Down. Where stocks would be if not for Ben/Kevin and their magical well of ink. This sh*t has become so detached from reality.

Fri, 04/12/2013 - 09:06 | 3440256 Headbanger
Headbanger's picture

And what does this do to "money velocity" which has been plummetting lately??

Fri, 04/12/2013 - 09:14 | 3440289 deerhunter
deerhunter's picture

silver soon to be worth less than bullets????  Maybe free silver.  My average cost per ounce is in the low 30's.  Maybe silver bullets cheaper to make than lead soon?    Just kidding,  great buying opportunity in silver today.  LCS visit planned.  Bought my first gold the other day,  1/10 oz philharmonic.  That is one small coin.  New ASE's 3.50 over spot.  That is good price I guess from the feedback from the site here.  4G's here,  God, guns, guts and a garden. 

Fri, 04/12/2013 - 09:16 | 3440304 scatterbrains
scatterbrains's picture

This is great news for the high end markets represented by reits like SPG which is up 70% above it's 07 bubble highs and 700% from the 09 lows.  It means Benny's plan to destroy the middle class and separate the .01% by orders of magnitude from the rest of the country is working. Look for mall space reits to re-double again from here. 

Fri, 04/12/2013 - 09:20 | 3440317 Edward Fiatski
Edward Fiatski's picture

Rec-c-ov-v-ery S-s-um-mer.

Coming to a planet, near YOU!

Fri, 04/12/2013 - 09:21 | 3440326 asscannon101
asscannon101's picture

Yeah, but WalMart sure found a way to address their sales slump- they fired the poor bastard who had balls enough to call it like it was. Nothing like killing the messenger to encourage group-think within an organization. Success!! Didn't Demming say something about, "driving out fear"? They won't hear another negative report for quite some time and future conference calls will sound like a fucking echo-chamber of the bosses' hopes and stupid ideas. Now cue the corporate ass-vampires, who will swoop in at meetings and vie for the best opportunity to suckle at the bosses' hemmoroids to become the next 'Golden Boy'. American Management at its finest...

Fri, 04/12/2013 - 14:20 | 3442003 Disenchanted
Disenchanted's picture

All that(group think and echo chambers, etc.) was happening before the slump.

Fri, 04/12/2013 - 09:22 | 3440331 dobermangang
dobermangang's picture

Ben must be reading all the posts and giving everybody a thumbs down.

Start those printers Ben!

Fri, 04/12/2013 - 09:30 | 3440336 King Dong
King Dong's picture

The consumer is not just tapped out but bored of consumerism. This is an existential crisis with a fading economic model

Fri, 04/12/2013 - 09:32 | 3440353 Doyle Hargraves
Doyle Hargraves's picture

Well the interesting part of this is item 454, which has double digit gains. I think it is safe to say maybe the brick and mortar mega chains may be the dinosaurs destined for extinction, IMHO...here is the definition of non-store retailers from the Census/Commerce Department website:

(2) Non-store retailers -- those selling by other means -- include:

Mail order houses

Vending machine operators

Telemarketing sales

Home delivery (e.g., milk, newspapers)

Door-to-door sales

Party plans

Electronic shopping

Sales through temporary stands or stalls

Amazon, swap meets, flea markets, and other street fairs Bitchez!

Fri, 04/12/2013 - 09:48 | 3440451 adr
adr's picture

I had an interesting conversation with my marketing people. Our sales fell across multiple SKUs. However the percentage of total sales of one SKU increased from 23% to 32%.

The marketing people saw this as increased demand for that SKU and wanted to throw money at advertising it. Thinking that must be the direction the consumer is going in.

I asked, "Did total units sold increase? Or did the percentage of sales go up because the sales of our most popular SKUs went down?"

They gave me a puzzled look. I aksed them to give me the total sales numbers. Sure enough the sales of the product were less than last quarter, sales of the other SKUs had greater declines.

I told the marketing department that we might want to focus on the product that makes 68% of our money instead of the product that makes 32% of our money.
...
To your point, even in there are double digit gains in non-store retail. Those gains are easily eclipsed by declines in traditional retail. E-commerce is also an employment nuclear bomb. Unless the future economic model we want is robotic shipping of chinese made product direct to the doors of EBT card holders.

Fri, 04/12/2013 - 10:09 | 3440525 Doyle Hargraves
Doyle Hargraves's picture

Yeah, I see your point, however, there is growth in ecommerce as well as non traditional retail commerce. Though it MAY be eclipsed by the overall decline, it is the way of the future. I for one would rather sit in my home and get what I need through e commerce than go wait around some big box and watch the masses blow my tax dollars. Not saying everyone is like me, I for one, am not on EBT and rarely buy sh*t from China directly when I can get an item gently used for less through amazon or another source. Same with street fairs/swap meets/flea markets/gun shows. Why go to a traditional retailer when you can be smarter with your money? As far as the employment nuclear bomb goes well many other 'industries' have been employment nukes. See the housing collapse and the soon to be higher education collapse. If we don't make 'stuff' here, (manufacturing nuke already detonated), which is mostly the case save gasoline and food, then where is the loss of jobs except through the large store chains? The consumption model is dead, and your argument seems to be predicated on saving that model. We are in a depression, and as such, old models of large, centralized retailers being nationwide for the most part, will die. JC Penney, Sears, etc. People have less money but must maintain a standard of living. Non store retail seems to be a better alternative to me and countless others judging by the numbers, besides that, non store retail is largely a main street helper. Non store retail are small businesses set up at street fairs and swap meets to online retailers. I actually hope it is a model we embrace as it would do in our 'corporate masters'.

Fri, 04/12/2013 - 10:18 | 3440589 Temporalist
Temporalist's picture

Does making consumer debt zombies and predatory rent seeking corporations count as "stuff"?  How about apps?  Apps are stuff surely and everyone needs those.  How did people exist without apps for their car insurance?  I spend 9-18 hours a day looking at my car insurance app. 

Fri, 04/12/2013 - 09:53 | 3440462 mess nonster
mess nonster's picture

If you hung around the rural Northwest in the 80's and 90's you probably went to a Barter Faire...

Dreads, dope, organic homemade kimchee, and reggae music, all for trade, no cash.

The IRS came in a shut them all down, in concert with the county gummits.

Now the old hippies stare myopically at their smartphones, and wonder how to use the magical device they hold.

WE"RE DEVOOOOOLLLLLVING!!!!

Fri, 04/12/2013 - 09:31 | 3440356 Hubbs
Hubbs's picture

As long as the USD is a recognized "currency", it seems to me the stock market can be levitated indefinitely by the FED.

 

When the currency has nowhere else to go (even PMs?), the only place of refuge is the stock market, where stocks (paper certificates) are valued in terms of other paper certificates (fiat dollars).

Fri, 04/12/2013 - 09:32 | 3440362 thismarketisrigged
thismarketisrigged's picture

was anyone watching cnbc live when santeli was going over the retail and ppi numbers?

 

they were showing the dow futures as he was talking, and cnbc printed a show of dow futures down 14,700 pts, and the dow at 6.00 pts, down 99.99 percent

 

if only that were the case, as it should be in this economy.

 

how the fuck is the market not down triple digits today at open? such a fucking mother fucking joke. arrest bernanke and all of the fed and wall st, and impeach obama, please

Fri, 04/12/2013 - 09:33 | 3440370 NoDebt
NoDebt's picture

I need more Swirlogram, says Christopher Walken.

Fri, 04/12/2013 - 09:33 | 3440372 orangegeek
orangegeek's picture

Dow opens down 41.  LMAO.

 

Ben and Barry must be covered in ink and sweating like pigs cranking out the cash.

 

Buy Ben!!!  Buy Barry!!!  Before this shit market crashes.

Fri, 04/12/2013 - 09:41 | 3440404 thismarketisrigged
thismarketisrigged's picture

retail sales horrible, ppi horrible? no problem, this market should be green any minute.

 

i want to punch someone

Fri, 04/12/2013 - 09:46 | 3440439 yogibear
yogibear's picture

It's all of Bubble Bernanke and the Fed's printed money sitting with JPM, Citi, Goldman used in buying stocks.

Inflation is knocking at the door. It's already showing up. The major inflation is waiting and it will be ugly by crushing the consumer even more.

 

Fri, 04/12/2013 - 09:42 | 3440413 yogibear
yogibear's picture

Bubble Bernanke and the Fed, unless you start sending thousands of dollars to US consumers directly it will only get worse. Reality is going to be really painful.

Fri, 04/12/2013 - 09:45 | 3440438 slimething
Fri, 04/12/2013 - 09:58 | 3440483 adr
adr's picture

The terrible retail sales are bullish for the GDP print with the new way it has been calculated since Q3 2012. Imports will probably add at least 2% to the Q1 GDP number. The massive stock market rally should add at least 3% in finacial services. Look at auto sales, subprime or not, big add GDP. All those cancelled aircraft orders, that was last quarter, the are back on the books. Orders booked of planes that can't still be delivered, GDP positive. The historical GDP subtractors have been made into additions and the ones left will be tiny, 1.25% maybe, perhaps a bit more.

I see a GDP print of 3.8% as a very good posibility.

I wish I was been sarcastic. But this is the new normal, and it's insane.

Fri, 04/12/2013 - 09:50 | 3440458 paddy0761
paddy0761's picture

About to go green.

Fri, 04/12/2013 - 10:01 | 3440493 IamtheREALmario
IamtheREALmario's picture

We went through this in the late 70s and very early 80s. People say that the Reagan administration got us out of it with the start of the loose money policy. I still remember those days well. There was a significant deterioration of the US infrastructure, inflation was rampant, people were not spending money because of the combo-hit of inflation and high interest rates, vacation homes were in foreclosure and massively in disrepair, gold went to the moon and people were hoarding metals. (sound familiar)

There was a VERY BIG difference, however. The US had a very strong base of high tech manufacturing with the support industries (chemical and such) behind it. It was the commercialization of the PC and the manufacturing boom that came from it that really pulled us out, not banker policy.

That is why this time will be different unless we start creating value again in this country... but that is not the point, is it. The point is to level the global economies so that there are no borders and it can all be melded together into one big communist soup under one dictator... and his cronies.

Fri, 04/12/2013 - 22:25 | 3443839 jim249
jim249's picture

And Amazon continues to soar in price?

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