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Retail Sales Slump On Deck: Consumer Spending Slides To Lowest Since March After Worst August Since 2012
When it comes to exposing the disturbing, some say desperate, propaganda wave sweeping the nation, nothing has quite captured the unprecedented decoupling between policy-accepted "confidence indicators" such as the Conference Board, which in August printed at its 2015 highs and those which actually poll people such as Gallup, whose economic outlook indicator collapsed to the lowest level in one year.
Which, considering the general state of the economy, begs the question: has Gallup now officially become the one poll-based indicator that has not been tained by "policy-supervision."
We don't know the answer, but we do know that if Gallup indeed provides an accurate representation of the US economy, then August retail spending - that most important driver of the US economy, more important even than the backward looking GDP print - is set to come crashing down with a bang. The reason: according to the latest Gallup report on US consumer spending, in which a random sample of 15.724 adults were interviewed by phone, Americans' self-reported daily spending averaged just $89 in August, down not only from August in 2014 and 2013...
... but the fourth month in a row of year-over-year spending declines, as well as was also the lowest monthly spend since March of 2015.
And this time there are no "scapegoats" to blame the spending slowdown on: the weather in August was uniformly gorgeous around the US.
A quick reminder what Gallup foes actually measure:
Gallup's daily spending measure asks Americans to estimate the total amount they spent "yesterday" in restaurants, gas stations, stores or online -- not counting home, vehicle or other major purchases, or normal monthly bills -- to provide an indication of Americans' discretionary spending. The average for August 2015 is based on Gallup Daily tracking interviews with more than 15,000 U.S. adults.
As Gallup reminds us, "spending peaked at $114 in May 2008 before waning and then plunging amid the global economic crisis that took hold later in the year. From 2009 to 2012, spending stagnated, ranging between $58 and $83. Americans' spending picked up in late 2012, and continued in 2013 and 2014, ranging from $78 to $98." Since then it has clearly tapered off and is a long, long way away from the pre-crisis peaks hit in mid-2008 before the trapdoor opened.
If August is indeed confirmed to be weak, September will be even weaker:
If monthly spending patterns in recent years are any indication of what is to come, spending is not likely to increase in September. In each of the previous five years, spending in September has been lower than in August, including sharp declines of $11 in 2013 and $7 in 2014. In 2008 and 2009, it increased slightly, but only by a dollar or two.
Regular declines in spending from August to September are understandable given the end of the vacation season and the end of back-to-school shopping, one of the busiest times of the year for retailers.
The bottom line: "Though down slightly, Americans' spending remains in somewhat of a holding pattern, having stayed within a $2 range for the last five months. But while the average for August is on par with recent months, it remains below averages recorded for August in 2013 and 2014."
Finally, we should note that the market swoon which saw a vicious correction in the S&P500, did not start until after August 19, the day the FOMC minutes were released. Expect to see substantial sticker shock once "mom and pop" open their monthly 401(k) or brokerage statement and find their net worth was quietly truncated by 10% or more. Do not expect a sharp spending rebound to follow, especially if the Fed does hike rates in 10 days.
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What Now,Chair Yellen????
We are spending about the same amount of money this year as "normal". There are some one-time purchases we have to make.
2015 is our last year of "spending money".
But the hammer comes down next year. Hunkering down, spending much less for the foreseable future.
THE DOLLAR IS A DEBT NOTE/SHARE OF THE BANKRUPT FEDERAL RESERVE BANK.
Owners of notes are shareholders in the corporation the Federal Reserve Bank.
What happens when they go bankrupt?
buy silver
:)
Since the weather was so nice everywhere, nobody had time to shop as they were all out enjoying the weather. Or killing each other in Chicago. Which they like there, especially when its nice outside.
Run!
Too hot, cold, wet or dry, so we need to outlaw the weather......
All part of Barry's Legacy. Annihilation of the Middle Class.
Yeah, and now Biden's first big speech was that the Economy Sucks and He's Got to Do Something About It as President!
He's All In for the Little Guy
Oh the irony of it all.
Its VP Joe Bidet.Please get his name right.
Knuckles - you got it all wrong - Biden is on record as telling The American People how to gird their loins for the New American Economy.
" Buy a shotgun. "
Problem solved. Shoot your neighbor for that last can of cat food.
BTFD. Any FD, just B it.
This number will improve for September, as your resident Tsar bought two new Samsung phones this past Saturday, one for himself and one for his husband. My phone will get reimbursed through work, so in essense I spent some corporate money. Good on me!
Oh, and we ordered loads of Chinese and Thai takeout this weekend. So, we're doing our best to help the US eCONomy stay on track.
.....good luck with those phones....
"Daily Consumer Spending" What IS that? How do they calculate that and what's included?
I just did a quick back of the envelope calculation for myself including everything I would consider "consumer" spending and got, $18.69. Who ARE these people who are spending nearly $100/per day!!??
Caviar, hookers, blow, Fortune magazine subsciptions, and bribes for lawmakers - these have got to be included for this number to be so high.
For real! We spent nothing yesterday.
I'm going to have to agree with you here. I look back at my good years. That generally was between 1996 and 2002. [1] I could never bring myself to spend more than $50 / day. And that was with $1 or less gas at the pump. It was probably closer to a $25 / day limit. When I considered myself rich, single no kids, with a 2000 sq. ft. home, a 20 ft. boat (Sea Ray), to burn $100 per day (even credit card purchases) was insane ..
Later, between 2006 and 2008, with a decent job, but much less lifestyle than before, (foreclosed on the the home and boat, to a one bedroom apt.) $25 / day was excessively generous. Still single and no kids ..
I had a short spurt again between 2010 and 2012, too much going into debt payment to family. Discretionary spending was practically non-existent with monthly increasing rents , fuel, etc ..
Since '12, been largely at the poverty level, living with elderly parents, part-time jobs/projects, handy man for parent's home to pay room and board ..
People 55+ are simply not being hired. SWSM at 55+ doubly so ..
So I guess you can understand why my only hope, the hope of 100+ million Americans un/under-employed; (the alternative as Rob Kirby states a "new dark age." As Bill Holter literally describes "Mad Max.") is in the Wanta Plan ..
https://app.box.com/s/hfgvcqg7gqh7i27at6sv53ywu87lwarp
(Start with 11 minute teaser. Follow bread crumbs.)
-------------
[1] In this period, I could and did loan up to $5000 to family, without interest and waiting a year for payback .............. comfortably .. In the same, I purchased a brand new home, truck, boat, and raw land (sold for decent profit) .. Not much PM or stocks ..
Bullish! It means an announcement on QE4. Never ending stock pumpathon by the Fed. As long as there is confidence in the Federal Reserve the mkts remain rigged. Once all confidence in the Fed is lost free mkts return.
I splurged yeasterday. I spent $40 at best buy for a bluetooth speaker! Another $31 for Mai Tai's at a beachfront bar. And $10 to park the Vette.
I've been on deck since day 1. Freak niggaz on deck.
Fortunately, the economy is decoupled from consumer spending.
"It's contained."
"And this time there are no "scapegoats" to blame the spending slowdown on: the weather in August was uniformly gorgeous around the US."
Well, obviously there was no bad weather to force shoppers into the malls....no hurricanes to drive them to Home Depot....ditto tornadoes in the Mid West....and out here in the land of fun and sun, traffic was so bad no one wanted to leave home.
With the $15 minimum wage responses from many fast food going to Tablet or Kiosk orders...maybe order from the parking lot and just walk-in pickup order....then retail is going UBER and will not turn back. Most retail may start looking like a mini-Amazon shop with robots grabbing/assembling your order into your "box" or kit and then you just pickup your box. Maybe pay automatically too. Looking grim for retails since UBER and technology are driving the trends.
Amazon, UBER, and internet/online sales are defining the future of "retail".
In California we have In-and-Out burgers, and when the drive-thru gets too long they send out tablet-taker in the car lineup for getting your order, so when you drive up it is ready...so no wait.
Retail is changing sooner than later.
So, filling up the family car(s) is considered "discretionary" income spending? For most Americans having a car and putting gas in it is far from discretionary spending. It is the means to get back and forth to work without which there is no spending except whatever us taxpayers furnish in the form of entitlements
And, if it is "in the mix" then because the price of gas has been declining, wouldn't that account for the decrease in day to day spending? Yeah, thought so . . .
In any evernt, like the falling through the crapper 1st Qrt GDP numbers (which was NOT due to most Americans freezing their asses off, but to . . . er . . . climate change), the CNBC, so-called economist, Steve Liesman is diligently working away at showing that the inputs are the culprits and will henceforth be adjusted upward!
And, by the way, according to ovomit, this is the Summer of the Rebound (for the seventh year in a row) or something or other . . .
So, those Gallup numbers have to be wrong. Just ring up Steve from here on out, Gallup. He'll have the "happy face" numbers at the ready!
This has nothing and I repeat absolutely nothing to do with FED produced computer graphs of the markets.
Nope just Fed produced digital fiat currency units in a banking account multiplied times 100 and leveraged ad infinum.
:)
Stock rally! It's bullish news. Everything is awesome!
BTFD!!!!!!
:)
This has coincided with the opening of the markets for marijuana dispensaries. The broadening of the marijuana market dampens sales of all things that involve leaving the comfort of the sofa--less money spent on everything except lavalamps,black light posters, ice cream, and Frito Lay products. Bullish for snack food retail!
We have spent more this year than the last 5 but got married and we needed furniture. Need meaning if I want to stay married. However I have been hunkering for 8 years. 200000 rounds and 6 months of freeze dried food. 50# silver. 2# AU.
Okay, I admit it. Last week I spent $150 on a bucketful of freeze-dried meals guaranteed to last 25 years (longer than I expect to live). Since I know food inflation will keep going up, I'll be eating this stuff way before the apocalypse.
So let's do some very simple math here.
$89/per day x 365 = $32,485. That's more than half the population takes home after taxes, or very close to it.
And that's "Consumer" spending....Mmmmkay.....whatever....
I last spent money on Sunday. $10 for a space at the flea market, $11 buying other vendor's merchandise, and $3 for a drink at Dunkin Donuts. Were it not for the flea market, my spending for the last few days has been zero. And I think I have exactly two friends who earn enough to spend $89 a day, but I bet they don't.
How is this a surprise? Besides food and energy that all of us are required to use everyday, everything else has stagnated. A 5 year old PC is still fast enough, a 2 year old phone is still good, much less other consumer appliances like fridges and a new economy car isn't exactly better than one 20 years ago. What motive does the average consumer to spend more these days, especially with shrinking income?