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A Less Exuberant Look At Retail Sales
The last two days' stock market rally rebound was blamed (assigned for headline purposes) among other things on the better-than-expected retail sales data yesterday morning. Ignoring the fact that it was 92% correlated with USDJPY, the facts are, as Bloomberg's Joseph Brusuelas notes, that the data showed discretionary spending growth continuing its almost-three-year slide.
Via Bloomberg,
The topline retail sales number reported yesterday exceeded forecasts. It was bolstered by rising gasoline prices and an increase in holiday food purchases, even as consumer spending slowed modestly in December due to a reduced pace of demand and declining sales at department stores. The details of the report show discretionary spending took a fairly large hit in December. Consumer spending has steadily slowed since hitting a peak in 2011.
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Not true. Everyone on Fast Money Halftime Report said retail sales were great and the market is going higher
Thats because none of the numbers matter, everyone thinks we are going higher so we are going higher. Volatility is trading like there is no risk to the downside because there is no risk to the downside. The FED has said in no uncertain terms that they will backstop everything for ever and if you look at the tape action the market does not want to down tick even a little bit; Its not that hard, we are going substantially higher from here.
Anyone shorting this market is an idiot and will never ever get their shorts back, its akin to shorting the market in the mid 90s. Even IF you managed to hold them from 1996 through the 2000 peak, which would have been basically impossible for anyone to do, you never were able to even scratch any shorts laid out in the mid 90s... ever..
In two years or so when the ES is trading over 5000 sure close your eyes and lay out some shorts, as for right now, we are not even remotely close to a top. not.even.close.
"Volatility is trading like there is no risk to the downside because there is no risk to the downside."
Famous last words- it's different this time.
I think the Fed is a little more anxious to end QE than you think.
Two weeks from now, we will know enough to see if earnings were good enough to drive stocks even higher.
For now, I do not get the excitement over the bank earnings, which are being driven in large part by reserve releases.
I think a sign of the kind of sick economic/market environment we operate in occured on CNBC after the close yesterday, when an analyst chided Wells Fargo for not cutting enough people or salaries. So we could see good earnings this quarter, but how much longer can the conusmer be squeezed before demand can no longer support any growth.
Rational thought and analysis doesn't matter. Only thing that matters is what the pundits say.
Time to get the spin machine rolling for earnings season.
Now some grass roots news from real jornualism;
http://www.theguardian.com/world/2014/jan/15/north-carolina-unemployment...
In regards to this story, I believe it was Ron Paul on the campaign trail last year stating "If you want to see real change and progressive for a better America cut the wages of all government officials to the national average, cut their lifetime benefits, and ban lobbying donations." In a sense that is probably the smartest thing that could happen to these fucks in DC, though how one accomplishes this is still unknown to me. I have actually been research how I could get a measure of that type onto a ballot for the next elections at a city level here in Colorado. The government needs to remember that it is we who control them and not the other way around.
Good story thanks for posting that link.
As I've said countless times, if individuals actually had that much power at the ballot box voting would have been outlawed decades ago. You simply don't have that much power. Think about it, electronic voting machines exist for a reason. And it's not for your benefit. It's all an illusion. Don't waste your time.
"Those who vote decide nothing, those who count the vote decide everything"
-Stalin
Oh I agree completely that voting is f'ing pointless. I was just thinking that a ballot of that type of measure would at least generate some type of yearning within society. Though its all bought and paid for regardless of what we want.
Here in Canada we have similar problems, perhaps not quite as corrupt Politicians as the US and the Debt is not as large per person, but our people have their head in the sand as well. They will complain about the price of gas, or food going up be they cannot, or refuse to connect the dots.
I have been trying to wake people up, but they are brain dead. I try to get them mad, hoping they will pull their head out of the sand long enough to see the light, but they don't.
I tell them things like, "you tell me you love your children and grandchildren , yet when I inform you that their unborn granchild will owe approx $17,000 per child"(national debt only not including provincial or municipal debt) they come back with "Oh " and that is the end of it.
These fools think the Gov is their friend. Ha, whent he SHTF Just go to your Gov Building for help. My guess is you will be shot on site!
A Gov will continue to spend, spend , spend, when they have a credit card and you get the bill!
So, what JCP, Sears and Target have said about sales is more or less true? /sarc
increase in holiday food purchase or did food price get jacked up during the holiday? I thought it really weird during the holiday that all the prices in grocery store were higher than usual ...
@pragmatic hobo
Mark it up 20% so you can discount it 10%.
Am I the only one to see a relative minimum around March 2013 and a very obvious uptrend since?
sunny
Yes. None of the rest of us can see it.
Up arrow for pointing out the emperor's retail apparel, even knowing you could get hammered for it around here.
@sunny @no debt
Whatever uptrend you think you see, consider that 1.3M people are scheduled to lose EUC benefit payments this month. Oh, and Obamacare....
And that is NOT the point. The point is that in the last 11 or so months there has been a clear uptrend to the data shown, yet the text implies otherwise. Tomorrow the world may end, so be it. Be careful of just how wide a brush you, editors, anyone else paints data with.
sunny
@sunny
I have my own eyes and ears to see and hear the world. Have you not noticed the decaying society we inhabit? I remember better times and long for their return....it just ain't gonna happen anytime soon.
Of course I've noticed. We exist in a world that is becoming more and more ugly. What has that got to do with misinterpreting some data on a chart?
sunny
@sunny
What about ~ March 2013 says "bottom" to you? Are you using some wave analysis? EW, perhaps. Because, it looks like it's rolling over yet again to me, particularly in light of the recent drop in BDI, Dec. NFP and the EUC cliff. Difference of opinion, I guess, but no way you can say that Tyler misinterpreted the chart.
I'm doing my part. I stopped buying anything I don't need. I just made my first big splurged in quite awhile on a $20 a month gym membership. While I'm in decent shape, it's definitely a must have, as I NEED to get in better shape for what's coming. Plus, fuck Obamascam I'll just avoid the system all together.
$20/mo. is excellent, but I've gotten rid of that, too. In August I bought a weight bench and free weights (good ones; fairly expensive) and now after five months, have my per workout cost down below $12; continuously falling with every workout, and I'll NEVER wear out a set of steel weights if I live a hundred lifetimes. That set up plus my mountain bike and I'm all set with practically zero in future costs moving forward.
With money earning a fraction of a percent, it's worth it to convert some cash into things that will support your standard of living provided the total amortized cost keeps trending downward.
and do to the great retail sales , Sears closed 6 KMart 6 Target 8
macys 5 since jan 1st and JC penny is closing 33! good retail my ass!
hand out MOAR FEWD stamps and retail sales will go higher
Unless the retailers are showing YOY growth in sales that is off the charts, all these guys are doing is taking merchandise in one door and then moving it out the other door at nearly the same price. There is no growth in individual incomes so the retailers can't raise their prices. What the cheerleaders on CNBS never report is the fact that the retailers are not making any money. If people don't have the money to spend, these big box stores can discount all they want to move their goods, but it just won't matter.
I don't believe in math! I believe in numbers!