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Guest Post: A Final Word On Those "Robust" July Retail Sales

Tyler Durden's picture





 

Submitted by Jeff Snider, CIO of Alhamba Investment Partners

A Final Word On Those "Robust" July Retail Sales

This current weak trend in a broad cross section of economic accounts and variables has been a big threat to the decouple/muddle through philosophy.  Retail sales figures have been sharply lower in the most recent months, pointing very ominously to the exhausted state of that vital US consumer.  So it was very heartening to the decouplers to see a nice, robust rebound in July that was almost totally unrelated to the renewed soaring cost of energy and food.  The broad increase in retail sales figures, despite trends seen elsewhere however, seemed to be a bit of an outlier.  ZeroHedge created a bit of controversy by noting more problems in seasonal adjustments (http://www.zerohedge.com/news/mystery-july-retail-sales-beat-solved-it-all-seasonal-adjustment), only to be countered shortly thereafter by Morgan Stanley (http://www.zerohedge.com/news/morgan-stanleys-defends-retail-sales-seasonal-adjustments-crazy-zero-hedge-analysis-bac-upgrade).  So were the July figures muddle-worthy or otherwise?

It makes some sense that the difference in the number of shopping weekends is cause for large seasonal tuning to render a full apples-to-apples comparison between months.  I am not so sure that a mid-week holiday would cause such a major need for imputations and extrapolations, but that is the nature of econometrics and the vain pursuit (and false comfort) of economic precision.  Whatever the rationale, ZeroHedge rightly pointed out the inconsistency of results:

While there may have only been 4 shopping weekends in July 2012 vs. July 2011, that extra weekend found its way up into June 2012.  Compared to June 2011, there was an extra weekend that did nothing to help the atrocious results (on a seasonally adjusted basis).  Perhaps if we put the two months together to account for this shiftiness in Gregorian calendaring we can step outside these seasonal manipulations altogether.  While the mainstream of economics pursues the false sense of precision that comes from these attempts, there is a much easier method of getting at what is far more important:  the trend.

Using year-over-year changes strips out all of these econometric interventions into the data.  Since these figures are raw, they are not adjusted for inflation either (meaning there is no argument over what properly constitutes “real” retail sales growth). 

The retail sales figures from that perspective show a couple of very clear points:  1. Last year's Christmas season was not only weak and disappointing, it may have marked the inflection point in consumer spending (at least as far as retail sales measure); 2. The July "improvement" is far less impressive.  June 2012 had an extra holiday shopping weekend, but registered only a 3.3% improvement over June 2011.  Without an extra holiday weekend, July 2012 saw almost identical year-over-year growth; 3.4%.  No matter what or how weekends were arranged within the calendar context, non-adjusted growth was not really all that inspiring in either month. 
 

What may be worse is that since March unadjusted retail sales have consistently been running below the moving average.  That demonstrates conclusively and unambiguously that momentum in the consumer segment is slowing.  Inflections in retail sales, as you would expect given an economic system dominated by consumption, are followed by recessions.  At this point in the “cycle” (such that there is a cycle outside of the mini-cycles created by central bank interventions) there is not much left to reverse the course.

As more and more Americans fall off the 99-week cliff into disability (best case) or the general abyss of the new structural joblessness, it is hard to see any monetary dosage or application that would be beneficial to the real economy.  When you step back and try to analyze why there was an inflection in mid-to-late 2011, the combined impacts of waning job growth and exhausted government transfers under the umbrella of monetary-driven commodity pressures make for not just a tough environment or a muddle, but the reversal of everything that would be considered necessary for widespread economic health in any meaningful sense (there might be more dollars circulating but that is not really the true measure of economic success). 

If this inflection in consumption is indeed valid, it makes sense that the early part of 2012 would then experience economic “volatility” – revenue pressures at firms cause them to cut back on capex or re-investment in real projects, including a decrease in the pace of hiring new workers.  Manufacturing falls off (seen in the ISM and regional Fed surveys) as reduced demand from businesses works its way back into this vicious cycle of employment malaise where job growth is consistently and vitally below population growth or labor force expansion.   As government transfers drop off, the segment of the economy under the gun of stagnation rises in proportion and the bifurcated economy becomes more so – except that as the troubled half grows it inevitably pulls down the half doing relatively well.  What looks like a muddle of weak growth is really the rot of monetary intrusions eating at what should be a free market-driven reset to the previous dislocation of failures from past monetary episodes.  And it is all in the name of some ephemeral “wealth”. 

Stock prices may be higher, but the “wealth effect” is dead without the ability to turn paper portfolio values or tangible real estate “wealth” into spending through credit.  It has always been about debt. 

What might retail sales growth have looked like in the middle of the last decade without the $4.5 trillion in new mortgage debt and $500 billion in new consumer debt (added between 2003 and 2007)?  As we are about to find out, the number of weekends and the placement of holidays would have been the least of the concerns. 

 


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Fri, 08/17/2012 - 17:28 | Link to Comment nope-1004
nope-1004's picture

Easy credit brought demand forward.  Incentives like "cash for clunkers" simply brings future purchases to the here and now.  That is why 'robust' retail won't happen again.... easy credit of the last decade made shopaholics out of everyone, using their house LOC as the means.  Now the gig is up.

 

 

Fri, 08/17/2012 - 17:29 | Link to Comment ACP
Fri, 08/17/2012 - 17:34 | Link to Comment AlaricBalth
AlaricBalth's picture

X-13 ARIMA brought demand out of nowhere.
"Assume a can opener. "

Fri, 08/17/2012 - 18:03 | Link to Comment AlphaDawg
AlphaDawg's picture

What the fuck does retail matter anymore? There is no way the retail, or any other, tax revenues will fix this soverign debt problem.

Everything is bullshit, you know it.

If you are talking from a stock perspective, ur fuckin crazy! Short, long whatever, youll get fucked in the end.........you cant time this shit. Clearly the way to make money is not investing, its using your mind and skills and convert your toilet paper into something physical.

Fri, 08/17/2012 - 20:59 | Link to Comment The Monkey
The Monkey's picture

VIX at a 5 year low, volume terrible, treasuries with a mini capitulation at a bullish equity extreme.

Time to double down: VXX, SPXU and FAZ.

Looks like we might get an outright crash here in the next couple of weeks.

Sat, 08/18/2012 - 05:13 | Link to Comment Poor Grogman
Poor Grogman's picture

Only if the PTB "let it happen"

Assume it's planned then ask, what could they be trying to achieve?

Sat, 08/18/2012 - 08:35 | Link to Comment Drag Racer
Drag Racer's picture

consolidation

Fri, 08/17/2012 - 18:04 | Link to Comment NotApplicable
NotApplicable's picture

I just ruined DishTV's numbers by canceling my service that somehow had gotten to $100 a month (with NO movie channels) after being "bundled" to my phone service for a few years.

They offered to give me $15 a month off of it. I laughed and said that is still stupid expensive for TV that I don't even hardly watch anymore.

Fri, 08/17/2012 - 18:27 | Link to Comment nodhannum
nodhannum's picture

Just did the same with DirecTV!  Outta here Jack!  They call and send mail offering(s) to lower the price for what, government propaganda and mind numbing "Jersey Shore" shit.  Gone...done and $100/mo to the better after tax.

Fri, 08/17/2012 - 19:36 | Link to Comment Lewshine
Lewshine's picture

I work in Dallas installing DirecTV. You'd be amazed at what kind of conditions I see on my installs. People who live in trash up to their knees, without toilets that flush, Rat feces, and cochroaches running everywhere, stinking to high heaven...YET, ordering the Mac daddy double deluxe, 2500 channel, east coast/west coast, all sports and movies HDTV package for a mere $599.00 per month. Priorities.

Fri, 08/17/2012 - 21:13 | Link to Comment jplotinus
jplotinus's picture

When I see posts like the following I also see a subliminal message stating:

--It's all their own damn fault--

That message prevents us from naming the real cause of economic collapse brought on by corporate and bankster fraud.

I suggest a reconsideration of the need to post stuff that blames poor people for engaging in escapism, that might actually be a healthy coping mechanism:

"I work in Dallas installing DirecTV. You'd be amazed at what kind of conditions I see on my installs. People who live in trash up to their knees, without toilets that flush, Rat feces, and cochroaches running everywhere, stinking to high heaven...YET, ordering the Mac daddy double deluxe, 2500 channel, east coast/west coast, all sports and movies HDTV package for a mere $599.00 per month. Priorities."

No need to kick poor people when they are already down for the count.

Fri, 08/17/2012 - 22:19 | Link to Comment Neethgie
Neethgie's picture

you trollin brah?

it is there own damn fault.

Sat, 08/18/2012 - 02:02 | Link to Comment FerretBrain
FerretBrain's picture

If you can afford premium HDTV, you're not poor.  Believing otherwise is the result of too much coddling.

Sat, 08/18/2012 - 02:28 | Link to Comment DeltaDawn
DeltaDawn's picture

They need to escape through housecleaning.

Sat, 08/18/2012 - 11:05 | Link to Comment skipjack
skipjack's picture

Absolutely.  You may be poor but you don't have to live in filth.  As long as you have running water you can clean yourself and your living quarters.  Water's still cheap.

Sat, 08/18/2012 - 13:07 | Link to Comment LooseLee
LooseLee's picture

Unfortunately, anyone who can afford $599.00 a month for 'entertainment' is not poor and in now way 'down for the count'. Are you serious or just stupid? Anyone who can afford that level of cable TV is probably a banker or corporate executive....

Sat, 08/18/2012 - 12:53 | Link to Comment CoolBeans
CoolBeans's picture

Wow.  Just wow..speechless.  That's scary.

Fri, 08/17/2012 - 18:28 | Link to Comment CoolBeans
CoolBeans's picture

Same thing happened w/our bundled Internet + phone lines...
strange charges being piled on. Bastards...they just nickel and dime a customer to death.

DirecTV...after spending 3 weeks up north with only a radio, we decided we could easily trim down TV. Started by cutting all the worthless movie channels (which rarely show anything good). Will trim further in given time - but kids like sports channels...so is hard to cut it entirely. If it was just we adults (Mom and Dad), we could do with just news.

Fri, 08/17/2012 - 19:14 | Link to Comment Westcoastliberal
Westcoastliberal's picture

I wasted 15 minutes of my day on hold waiting for Verizon to tell me, "Well we notified you about the $6 monthly increase in your 3 room DVR, and you really won't save anything by canceling because we'll charge you $12 a box for a regular one."  But, I said, when I talked to your customer service rep 2 months ago they promised the DVR charge wouldn't increase, here's the transaction number ********.

Lieing to customers has become rampant with all these monolithic companies.  They'll tell you anything, then later it's "so what, go ahead and change providers, we don't CARE!"

Sat, 08/18/2012 - 12:51 | Link to Comment CoolBeans
CoolBeans's picture

OMG...absolutely correct!  They try every trick in the book and then some.

AT&T: Nearly two years ago, I cancelled an AT&T cell phone account by phone after an outrageous bill....those bastards have continued to bill me monthly despite my returning each and every one saying I'd cancelled.  I HAD NO CONTRACT, by the way.  We're coming up on two years despite notices. What is up with that?  Well, another stamp and letter...this time will copy the Attorney General's office, I guess.

DirectTV:  Every so often (at least 1-2x/yr) they add subscriptions - mainly sports to my bill.  I have to CALL them to have them removed.  That should be illegal.  Last call was two weeks ago.  The customer service rep says, "Can I ask why you want this cancelled?"  Response, "Because, as with every subscription your company adds to my account without authorization:  I DIDN'T ORDER IT!"

I then asked the DirecTV rep why a strange $2 or more amount keeps arbitrarily showing up on my bill when I'm paying each in full monthly -- every time I've gone to my account in the last few months there is a straggling fee.  She couldn't tell what that was about.  WHAT????

Macy's account:  Canceled a card I'd had for more than 20 years.  I paid the account in full in January....despite this a strange fee kept being billed each month ($2, $11) - I wrote to the credit co.  No response X2 months.  Wrote again - threatened to file formal regulatory complaint for billing practices - 2 wks later received a "oops, an error" in response and a check to refund the erroneous fees I'd paid during those month as needed to keep account in good standing was refunded as requested. 

PEOPLE:  Check your accounts over thoroughly - these and other companies seem to be pulling some dastardly tricks and I've noticed a huge increase of this activity in 2012.  $2, $5, $10 x all their customers = some serious unearned cash for these terrible credit/service companies and they're hoping that you're not paying attention.

Fri, 08/17/2012 - 18:43 | Link to Comment CrockettAlmanac.com
CrockettAlmanac.com's picture

When I cancelled my Dish they offered three months free. The guy couldn't understand why I wouldn't take it. He was flummoxed.

Sat, 08/18/2012 - 13:06 | Link to Comment I only kill chi...
I only kill chickens and wheat's picture

I confused a poor kid at a warehouse store pushing Sat TV. Me "I don't watch TV", Him blank stare, and then "what do you mean you don't watch TV", I said I rent some discs from netflix, but don't have cable, Sat, or an over the air antenna. Finally comprehension seeps in and he realizes "well I guess I can't help you with anything then.

Sun, 08/19/2012 - 06:10 | Link to Comment MisterMousePotato
MisterMousePotato's picture

I haven't had a television since 1984. When I visit my mother, though, I watch it. A lot. Reaffirms my decision and belief that I'm not missing anything.

Just think what I'd have if I had taken that $100/month plus, each and every month, since 1984 and invested it, in, oh say, gold? What would I now have? 50 AGEs? 70?

We gotta stop treating our roll(s) of twenties like they're good time coupons at the county fair. The smallest leak can sink the biggest vessel.

Someone posted this the other night:

Wise men are instructed by reason; Men of less understanding by experience; The most unknowing learn by necessity. Wise men do in the beginning what fools do in the end.

I copied it and set it as a screensaver.

Fri, 08/17/2012 - 17:54 | Link to Comment slaughterer
slaughterer's picture

ALL WE WANT FROM YOU, MR TYLER DURDEN, US MINIONS, IS FOR YOU TO PROVIDE JUSTIFICATION FOR WHY WE ARE LOSING TONS OF MONEY BEING SHORT AND OWNING PHYSICAL GOLD RIGHT NOW. CAN YOU DO THAT FOR US, PLEASE?  OR DO WE HAVE TO SUFFER THE USUAL SADISM FROM ZH?  

Fri, 08/17/2012 - 18:05 | Link to Comment NotApplicable
NotApplicable's picture

Have you been drinking?

Fri, 08/17/2012 - 18:07 | Link to Comment AlphaDawg
AlphaDawg's picture

Fuck up, you pussy.

Its your money, your decision where you put it.

Remember Shakespere: All that glistens is not gold, often you have heard this told, many a man his life hath sold, but his insides to behold.

ZH and the tylers are not gold either dick

Think for yourself

Fri, 08/17/2012 - 18:24 | Link to Comment slaughterer
slaughterer's picture

AlphaDAWG = rude Aufklaerung.  Fuck you, too, dawg.  

Fri, 08/17/2012 - 18:47 | Link to Comment AlphaDawg
AlphaDawg's picture

Thanks man, nice to find out you actually have some balls.

Ya get my drif though......you gotta put your money where your mouth is, not just casue anyone tells you to. Take advice and make your own decisions.

Fri, 08/17/2012 - 19:56 | Link to Comment fuu
fuu's picture

Where is the afternoon wrap up post?

Fri, 08/17/2012 - 20:42 | Link to Comment luna_man
luna_man's picture

 

 

"slaughterer",

DON'T BLAME MY MAIN MAN!!!...Perhaps, you should be in cash!

 

TOO MANY DUMMIES!!

Sat, 08/18/2012 - 03:46 | Link to Comment swissbene
swissbene's picture

there may not be justification.  the primary reason why you are losing tons of money trading is because you are attempting to gain tons of money by trading.  the prevalence and role of this 'business' activity is interesting topic itself.

but taking the objective of trading to be given, the following points are central on this site and relevant:

1. one would be nuts to trade in this environment and expect a reasonable outcome.  manipulation and fraud are widely reported and discussed.

2. related: central banks are openly and secretively intervening in most markets.

3. captured media have effective smokescreen/propoganda in place whether intentional or not.

4. large turns are difficult to time precisely.  long gold + short equities + short EUR could do okay in the end.

5. less retail/sucker participation in the market.  you are trading against sharks.  likely they understand sentiment on sites like this and perhaps even manipulate.

fwiw: i wish you luck & also am losing with similar strategy (not the first time).

Sat, 08/18/2012 - 08:53 | Link to Comment GubbermintWorker
GubbermintWorker's picture

I've done rather well with gold and silver. But, I started buying a few years ago ;-)

 

 

Sat, 08/18/2012 - 10:00 | Link to Comment Never One Roach
Never One Roach's picture

House prices down 38%.,......GLD and SLV up more then 200%.

Fri, 08/17/2012 - 17:29 | Link to Comment Getting Old Sucks
Getting Old Sucks's picture

Me: Hon, you want to go shopping?

Hon: you need anything?

Me: No, you need anything?

Hon: no.

Me: Yeah, why waste five bucks in gas.

Fri, 08/17/2012 - 17:52 | Link to Comment El Oregonian
El Oregonian's picture

Retail Sales??? In this frigg'in crappy economy NOBODY pays Retail anymore... WHOLESALE, BABY...

Fri, 08/17/2012 - 18:18 | Link to Comment LMAOLORI
LMAOLORI's picture

 

 

In this "frigg'in crappy" economy people are shopping at yard sales

Hard Times at the World's Longest Yard Sale

Fri, 08/17/2012 - 21:37 | Link to Comment New_Meat
New_Meat's picture

retail is for the g...

- Ned

Fri, 08/17/2012 - 17:31 | Link to Comment catch edge ghost
catch edge ghost's picture

Actually, when seasonally adjusted, this is the pentultimate word. The final word would be - lulz.

Fri, 08/17/2012 - 17:50 | Link to Comment poor fella
poor fella's picture

It was me... sorry, I bought A SHIRT to please the wifey since we were out 'shopping'... (serious too)

Although, retail analysts see purchases on the horizon as the season changes (=O). I have to ask though, who buys new winter jackets and shit EVERY YEAR?!? Is your crap THAT CHEAP that it doesn't last a few months? We all know that's b.s. - it's 'fashion'

FUCK YOU FASHION!!

FUNKTION precedes fashion every time.

Fri, 08/17/2012 - 17:55 | Link to Comment Getting Old Sucks
Getting Old Sucks's picture

It is truely amazing but we have so many clothes that are really old but almost new condition wise.  It's laughable when we see a color, patern or style come back and go to the closet to find we already have what's new.  Hon has so much shit with the tags still on that's better than the new same shit.  It goes to prove that we all bought so much shit in the past that we don't need anything.  I have at least 5 winter leather coats/jackets.  Shoes I've yet to wear.  Shirts and pants to last me forever,  Loads of tee shirts, underware, and socks still in the packeges.  I figure I have enough shit for the rest of my life.  Wish that wasn't true but have to be realistic.  LOL, if we go out and spend ten bucks, I yell out "see hon, we stimulated the economy!"

Fri, 08/17/2012 - 19:07 | Link to Comment RockyRacoon
RockyRacoon's picture

Just wrap the clothes up in a gift package and give them to each other.  It'll be like Christmas in August.

Sat, 08/18/2012 - 12:37 | Link to Comment CoolBeans
CoolBeans's picture

Keep new clothing purchases to socks and underwear.   Better yet...no underwear :)

Fri, 08/17/2012 - 23:54 | Link to Comment RockyRacoon
RockyRacoon's picture

Ooopsie...

Fri, 08/17/2012 - 18:22 | Link to Comment LeisureSmith
LeisureSmith's picture

Planned Obsolescence is everywhere. Marketing is constantly trying to convince us that buying low quality stuff at a higher price is better. Obsolete style, teck, and consumer goods booby trapped with failing parts. http://www.youtube.com/watch?v=0bxzU1HFC7Q

And yes, Fuck Fashion.

Fri, 08/17/2012 - 20:54 | Link to Comment luna_man
luna_man's picture

 

 

"poor fella",

 

Made in China, AIN'T made to last!...It's colorful.

Sat, 08/18/2012 - 13:25 | Link to Comment I only kill chi...
I only kill chickens and wheat's picture

I want a blender, but going to find a used one from 70's 60's if possible. Oster's still have a metal base, but the inside parts are plastic crap and don't get me started on stainless steel shit from china, it sure as hell isn't like the old American made SS.

Fri, 08/17/2012 - 17:33 | Link to Comment Cursive
Cursive's picture

Don't forget, either, the survivorship bias in these numbers.  Nobody is subtracting for Circuit City.

Fri, 08/17/2012 - 18:00 | Link to Comment Yen Cross
Yen Cross's picture

 When is there going to be a discount for paying for fuel with "XAU"?  Come on ARCO, the "Fiat" discount just doesn't cut it anymore!

  Independant gas station owners should buy , old local "Bank Branches" on corners. They have vaults in them, and good demographic/traffic studies.

Fri, 08/17/2012 - 17:34 | Link to Comment diogeneslaertius
diogeneslaertius's picture

robustness

Fri, 08/17/2012 - 17:35 | Link to Comment Tsar Pointless
Tsar Pointless's picture

And a final word on both this article and its subject matter from ZH's resident Tsar:

Pointless.

Fri, 08/17/2012 - 17:48 | Link to Comment poor fella
poor fella's picture

WHAT THE FUCK!?!?

Who the hell are you to call +70% of the Amreecan economiee 'pointless'?!?!

I am making a note of this PAL! And your moniker will be recorded!! You'd better pray there's no repercussions from your vacuous and harmful comment!

Fri, 08/17/2012 - 17:49 | Link to Comment Tsar Pointless
Tsar Pointless's picture

Huh?

Fri, 08/17/2012 - 18:01 | Link to Comment poor fella
poor fella's picture

Oh yeah, play innocent now. 

Don't worry yourself, the System-Participation Police will be notified of your lack of commitment and fellowhood.

The nerve of some people!! And on pre-shop-shop day! AMAZING THEY LET YOU PEOPLE OUT FREE TO ROAM...!!

Fri, 08/17/2012 - 17:47 | Link to Comment TruthInSunshine
TruthInSunshine's picture

This is an outstanding article.  It emphasizes the simple yet intentionally supressed fact that our economic activity is literally dependent on the uptake of ever larger sequential batches of debt, and that we no longer have a framework measuring economic growth based on the real/true value of goods and services produced.

If the ability and/or willingness of the populace to consume larger and larger batches of debt, which in turn depends on radical fractional reserve Modern Money Mechanics successfully creating new and massive bubbles (or re-inflating old ones) is inhibited, there can be no true economic growth that takes place in our brave new world (where debt/credit is the fuel for consumption, and consumption destroys wealth by levering up already massive levels of debt/credit).

The Federal Reserve model of "stimulating" economic growth should be officially re-named to Blowing Bubbles & Incentivizing 'Market' Participants To Chase Them.

Fri, 08/17/2012 - 17:39 | Link to Comment buzzsaw99
buzzsaw99's picture

Even with 0% financing and layaway too I think they have hit the wall of pulling demand forward.

Fri, 08/17/2012 - 17:54 | Link to Comment Yen Cross
Yen Cross's picture

  They ran out of "SunBeam" toasters to give away Buzz.

Fri, 08/17/2012 - 18:10 | Link to Comment buzzsaw99
buzzsaw99's picture

this x-mas i expect the x-99ers will max out the cc after that 2013 is gonna suuuuuckkk.

Fri, 08/17/2012 - 17:40 | Link to Comment thatthingcanfly
thatthingcanfly's picture

You didn't sell that.

Fri, 08/17/2012 - 17:42 | Link to Comment SwingForce
SwingForce's picture

Charles Biderman agreed with the ZH instant interpretation.

Fri, 08/17/2012 - 17:57 | Link to Comment Randall Cabot
Randall Cabot's picture

Haven't seen hide nor hair of "Bye Bye" Biderman since he went all in short last week-his moniker is "Bye Bye" because if you follow his investment advice your money will go bye bye.

Fri, 08/17/2012 - 18:46 | Link to Comment SwingForce
SwingForce's picture

His daily Vidz are here>>>  http://trimtabs.com/blog/

 

He's not perfect, but he's damn good at embracing new techology for an old man. I don't mean YouTube, my 10 yr old neice posts YouTubes, but his insistence that BLS use up to the minute witholding info, or using Visa & Mastercards RealTime data for retail sales- he's on the right track. And I like when he wears his black shirt.

Fri, 08/17/2012 - 17:46 | Link to Comment poor fella
poor fella's picture

(_._)

Fri, 08/17/2012 - 17:46 | Link to Comment LeisureSmith
LeisureSmith's picture

I've had light beer more robust than this. ZH Friday Humor where you at?

Fri, 08/17/2012 - 18:14 | Link to Comment poor fella
Fri, 08/17/2012 - 18:02 | Link to Comment Everybodys All ...
Everybodys All American's picture

Wealth effect can be gone and likely will be gone in a flash.

Fri, 08/17/2012 - 18:04 | Link to Comment economicfreefall
economicfreefall's picture

We have an economy where we have sub 2% inflation, where people who don't look for jobs are working, where those who save are harming job creation and where a bald professor in economics who has never tried real life is the highest priest. I refuse to join this church of insanity, which seems to have overtaken Christianity as the biggest religion on earth.

http://www.MiningStockValuator.com -portfolio tracker & analysis of gold and silver stocks

Fri, 08/17/2012 - 18:24 | Link to Comment LMAOLORI
LMAOLORI's picture

 

 

Inflation is higher then that on items we really need to live like FOOD

"Let’s say Julia goes shopping. She buys the groceries she purchases regularly—produce middle-class Americans might obtain on any given trip to the store. White bread, ground beef, red apples, beans, flour,turkey, and so on.

As it happens, Julia has a receipt from just before Obama took office for the same items. Same groceries, pre-Obama. What does she find? She’s now paying higher prices. There’s been a nearly 15 percent increase since Mr. Obama took office."

Fri, 08/17/2012 - 19:28 | Link to Comment economicfreefall
economicfreefall's picture

If you read my post again, you should notice that I do not believe in the 2% inflation mantra ;)

http://www.MiningStockValuator.com -portfolio tracker & analysis of gold and silver stocks

Fri, 08/17/2012 - 18:11 | Link to Comment CoolBeans
CoolBeans's picture

I may have inadvertently bumped this...Sorry.

I start holiday shopping in August by picking up an item here and there if a good sale pops up (for the kids). 

Oh, and I had a few extra bucks to add to the ammo and emergency food supplies. 

That's where any extra money goes these days.

 

Fri, 08/17/2012 - 18:18 | Link to Comment jplotinus
jplotinus's picture

I want to know whether an '08 style collapse is going to happen after Labor Day and before the November election. That said, I am certain no one posting on ZH, in either article, quip, comment, video, chart or cartoon can make that call or foretell an outcome one way or another. More muddle and more inertia are the most likely outcomes.

Crystal balls usuallyvdon't work, with '08 being a possible ecception. No one has the foggiest clue what direction the economy will take.

Fri, 08/17/2012 - 18:28 | Link to Comment LMAOLORI
LMAOLORI's picture

 

 

"jplotinus I want to know whether an '08 style collapse is going to happen after Labor Day and before the November election. That said, I am certain no one posting on ZH, in either article, quip, comment, video, chart or cartoon can make that call or foretell an outcome one way or another. More muddle and more inertia are the most likely outcomes."

 

No crystal ball but I would venture to say that all depends on QE they get it the crash is after the election IMHO

Chance of Fed Printing More Money Jumps to 60%

Sat, 08/18/2012 - 12:12 | Link to Comment CoolBeans
CoolBeans's picture

I tell my sons, "The heart will sometimes lie but your gut never will."  My gut tells me that things are only going to get worse.  So, no crystal ball but better to be mentally ready than not.

Fri, 08/17/2012 - 18:53 | Link to Comment surf0766
surf0766's picture

GM is number 1. GM is number one. Repeat it. And you will believeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee

Fri, 08/17/2012 - 19:55 | Link to Comment boiltherich
boiltherich's picture

Retail sales are the total amounts wrung up in retail stores, gas stations etc. and are adjusted for inflation, so if you have a 5% increase in sales but 2% inflation then the real reported increase is 3%.

What we have is a world where inflation is raging in many sectors of retail and that is being adjusted for what the Fed and the BLS claim is near zero inflation, so little or no adjustment.  So, of course you are going to get what looks like great increases in sales when we know for a fact on several levels that simply cannot be possible.  Household wealth, incomes, and consumer credit are all falling, at least in the bottom 90% of the population, so where is the money coming from to pay for all the sales? 

In reality sales in total dollar amounts have to be flat to declining, while units sold are each more expensive so those are plunging.  That is even if we are selling/buying the same dollar amounts of goods fewer goods are being retailed, and that feeds into the lower wages and wealth as fewer people are needed to produce goods.

Fri, 08/17/2012 - 20:16 | Link to Comment MiltonFriedmans...
MiltonFriedmansNightmare's picture

Good point boil,

If $10 of hamburger is substituted for $10 of filet (or perhaps dog food eventually) on the brides shopping list, there would be no change to retail sales (although there is a very real decrease to the standard of living).

Fri, 08/17/2012 - 20:12 | Link to Comment MiltonFriedmans...
MiltonFriedmansNightmare's picture

surf,

BM is number one, I mean GM is number one, GM is number one...

Didn't work....don't stop believing.

Fri, 08/17/2012 - 20:27 | Link to Comment surf0766
surf0766's picture

Drink more and try again.

Fri, 08/17/2012 - 20:36 | Link to Comment adr
adr's picture

Final word on July retail sales is my EDI report that shows total sales down 38% YoY.

Strangely the retailer that sent me the report claims store comps increased 7% from July of last year.

Hmm what to believe, a report generated using actual sales figured checked out through cash registers, or the report coming from the accounting division of the company?

Sat, 08/18/2012 - 04:01 | Link to Comment Things that go bump
Things that go bump's picture

In my little internet shop, where I sell Christmas items, sales had been slowly increasing since January (when they die, of coures), heading into my busy season that generally starts after the kids go to school in the fall.  In June, my graph looked like a hockey stick.  I was quite pleased and dreaming that maybe things were about to take off for me. Then, shortly after the 4th of July, everything just crashed.  You should see my graph.  Its as scary as anything I have seen on this site.  I have had literally had nothing since.  I'm not even getting any traffic. Something really bad is going on.    

Fri, 08/17/2012 - 21:14 | Link to Comment luna_man
luna_man's picture

 

 

In my line of work, I encounter Americas masses and times are changing...For the worse.  Purchases are getting cheaper and cheaper. 

Even, made in U.S.A., is cutting corners!

Sat, 08/18/2012 - 14:23 | Link to Comment CoolBeans
CoolBeans's picture

In mine, I encouter those in the investment business -- and the "slow pays" on invoices are at a record high.

Fri, 08/17/2012 - 21:19 | Link to Comment ATG
ATG's picture

No worries cronies, LK in TV assures us economic growth is on the way thanks to RR:

http://video.cnbc.com/gallery/?video=3000110098&play=1 9:07

Fri, 08/17/2012 - 23:25 | Link to Comment Yen Cross
Yen Cross's picture

 I still can't get over these July numbers! When you look@ the inflation>vs< spending    [CPi-PPi] #'s , it just doesn't add up!

Sat, 08/18/2012 - 02:30 | Link to Comment DeltaDawn
DeltaDawn's picture

The big retail boom on my area is in thrift store expansion. Anyone else seeing it?

Sat, 08/18/2012 - 02:53 | Link to Comment Yen Cross
Yen Cross's picture

Are you kidding me? The age of  Mini Malls, is about to be re-bourn!

Sat, 08/18/2012 - 11:46 | Link to Comment CoolBeans
CoolBeans's picture

Yes...new Dollar Store in our area + the Goodwill recently moved to a larger building.  Furniture store selling off all floor items for shut down but consignment furniture store seems to be doing okay.

Sat, 08/18/2012 - 15:30 | Link to Comment Colonel
Colonel's picture

Yep, its the free market at work even in a depressed economy because the government hasn't killed it yet. The jackboots keep stomping around on the cement but the dandelions keep pushing up through the cracks.

Sat, 08/18/2012 - 08:24 | Link to Comment sbenard
sbenard's picture

What Bernanke calls his "wealth effect" is just another word for a bubble. What everyone else considers to be a mirage of prosperity, the eternal academic thinks of as the real thing! I suggest it's Bernanke hubris instead!

If a market that defies risk, analysis, data, and reality and continues to march higher and higher, isn't a bubble, I don't know what is! This stock market is the very definition of a bubble!

Bubbles Bernanke!

Sat, 08/18/2012 - 08:28 | Link to Comment sbenard
sbenard's picture

Even the size of Dollar Store average sales is shrinking! That's not a sign of improvement! It's a sign of contraction!

And it's only going to get much worse with a lame duck dictator -- Emperor Obama -- over the next four years! There won't be much left of this economy after he's done with it!

Sat, 08/18/2012 - 11:41 | Link to Comment CoolBeans
CoolBeans's picture

Agreed. 

I have noticed some serious changes in the way people are shopping at two of our local stores.  People are being very careful and I've never seen so many purchases of canned products.  With a large family w/4 pets - I'm at the stores in town at least once per week.

I was chatting with an elderly couple (one disabled) who had stopped me to ask for help in connection with a particular product in a jar.  They had a flat of canned milk in their cart (on sale) and many canned veggies that were on sale - and at the register I noticed they had no fresh items.  This is typical around here this year, it seems.  I glance at carts and it is a little disturbing.

I especially worry about the elderly folks like these who may not be eating properly because of money woes.  I'm hoping I only see them on the days when they are restocking the pantry w/canned goods...but I think not.  Hopefully they are saving these purchases for the 2x/month local farmer's market. 

Hopefully kids out there are getting what they need to grow their minds and bodies properly - but I think not. 

Sat, 08/18/2012 - 11:43 | Link to Comment CoolBeans
CoolBeans's picture

Was also going to mention that I've noticed a lot of folks - young and old who are paying for grocery items in coins.  It seems they are breaking into their coin stashes to pay for goods.  Thought it was just one day - so made it a point to glance around during our shopping trips....and nearly every time I've been at the store in the past month, I've seen at least one person making a food-4-coin transaction.

Sat, 08/18/2012 - 22:08 | Link to Comment Iam_Silverman
Iam_Silverman's picture

"and nearly every time I've been at the store in the past month, I've seen at least one person making a food-4-coin transaction."

 

Let's hope that Gramma ain't using her junk silver stash for that..

Sat, 08/18/2012 - 09:08 | Link to Comment Silverhog
Silverhog's picture

Many folks like myself waited to purchase items until Sales Tax Free Weekend. Some are in July, many are in August. July & August retail sales may reflect some of this activity.

 http://www.taxadmin.org/fta/rate/sales_holiday.html

Sat, 08/18/2012 - 09:19 | Link to Comment jplotinus
jplotinus's picture

"And it's only going to get much worse with a lame duck dictator -- Emperor Obama -- over the next four years! There won't be much left of this economy after he's done with it!"

I should like to remind the poster that there was next to nothing in the economy when Onama took office. That said, I am not here making a "blame Bush" implied statement, either.

Obama chose to continue the bankstas bailouts and the illegal warring. He also declined to pursue war crimes charges against Bush&Co.", thus staking out a status quo approach to governance. That was his choice.

I cannot say he was wrong to do that. I can say I disagree with that milquetoast direction. But, I am not responsible for social cohesion, he is. Any departure from the status quo over the last 4 years could have resulted in civil war or societal disintegration.

Obama merits credit for making everyone equally upset. In these times, that is about the best that could be done.

If anyone here has a better idea, name it.

Oh, spare me your ideological diatribes of any and all flavors. Libertarian, free market, socialist, whatever. The USA is too fragmented, too angry and too self- absorbed, at the individual level, to come together around any solution that deviates in the least bit from that which passes for the norm. Or, in any event, that appears to have been Obama's calculation and I cannot fault him for calling it that way.

You can also spare me the prepped rhetoric as well. What kind of life do people think they'd live if everyday was lived in anticipation of having to win a gun battle for survival?

We are all in this mess together. Your MREs, bullets and PM stashes are but a distraction, an illusion and an anger projection.

Get better.

Sat, 08/18/2012 - 10:33 | Link to Comment Winston of Oceania
Winston of Oceania's picture

Why don't you just look to the corrupt third world for answers to your questions. Look to Greece if you like, an economy that is nearly half "underground", paying nothing is sales or income tax. Corruption comes from a beast that is so large no one can even keep track of the monies it wastes. Obama has done nothing out of anything but self interest so spare me your false pretense that upsetting people is the best anyone could do. He has divided this country by pitting one group of dependent people against another of self suffeciency, one of one color against one of another. No charges against the banksters nor politicians of the oligarchy. Once you wake up and realize there is no difference between the parties you just might feel better too.  Mostly I just wonder what the hell was your point...

http://www.wnd.com/1999/03/499/

Sat, 08/18/2012 - 11:32 | Link to Comment CoolBeans
CoolBeans's picture

Ahahahahaaaaaaaaa!

How much did the Dictator spend during his power grabbing dictatorship?

Wake up.

Sat, 08/18/2012 - 22:10 | Link to Comment Iam_Silverman
Iam_Silverman's picture

"We are all in this mess together. Your MREs, bullets and PM stashes are but a distraction, an illusion and an anger projection.

Get better."

 

OK.  But don't come knockin' on my door execting a handout.  You could be the next roast in the dutch oven after the cattle and wild hogs are gone.....

Sat, 08/18/2012 - 09:56 | Link to Comment Never One Roach
Never One Roach's picture

<<What might retail sales growth have looked like in the middle of the last decade without the $4.5 trillion in new mortgage debt and $500 billion in new consumer debt (added between 2003 and 2007)? >>

 

And a $Trillion$ in student loan debt.

Sat, 08/18/2012 - 11:18 | Link to Comment skipjack
skipjack's picture

The only goods I buy are canned goods at the grocery store, bushels of good food at the farmers' markets for home canning, seeds and fruit trees/bushes for the garden, ammo, and whatever else I can buy to be more self-sufficient.  I spend only locally or with American only (not multinational) corporations wherever possible.  Bought a wood cookstove las year, getting ready to pull the trigger on solar hot water next month.  All without debt.  The remainder goes to physical...well, whatever fell overboard in that boating accident.

 

Retail can continue to suck for the multinationals and the banks can continue to lose customers - the sooner they die the sooner I'll be happier.

Sat, 08/18/2012 - 12:43 | Link to Comment Super Macro
Super Macro's picture

So the American BOOM continues. Stocks will move up another 20-30% as liquidity, rates, FED, banks, consumers, housing, exports ALL continue to move higher. The forecasts of depression are ALL completely wrong.

Sat, 08/18/2012 - 13:07 | Link to Comment jplotinus
jplotinus's picture

My point is that Obama merits respect for maintaining social cohesiveness when that state of affairs could not be taken for granted. Rs hate Obama, or, so we're told. Yet, when the time came to offer up a replacement, they appear to have settled upon someone they, the Rs, don't even like. And, that for good reason. There's nothing to like about Romney and he just might have been the best of the limited (in stature) choices they had to select from.

I don't know why the R dislike of Obama did not translate into an inspiring alternative. Of course, I am here using the word "alternative" in a limited way. There is no political difference between R and D in either domestic or foreign policy. Nor has there ever been. The USA does not have political choice. All elected officials must comport themselves as though corporatism were the only political policy on earth. We know nothing else and we will get nothing else until we decide to change it.

Libertarians and socialists should team up and agree to put each other on ballots so they don't have to vote or not for Democricans or Republicrats.

Deal?

Sat, 08/18/2012 - 13:33 | Link to Comment Lednbrass
Lednbrass's picture

I am skeptical about the retention of social cohesiveness, personally I think the society is more polarized than at any time in 150 years. Putting Obama in office bought the compliance of blacks for as long as he is in office and they will put up with anything as long as he is the figurehead, once he is gone that will end.

I would argue that the only thread holding the Disunited States together is the currency, and once the USD loses its global clout that will be the end of it.

Sat, 08/18/2012 - 14:21 | Link to Comment CoolBeans
CoolBeans's picture

"Obama merits respect for maintaining social cohesiveness..."

With all due respect ---  You've got to be kidding - OWEBama seems to thrive on pulling groups apart, turning one against another and pulling the "race card" at every possible opportunity.  He's the biggest blame thrower in history. 

Sat, 08/18/2012 - 15:22 | Link to Comment jplotinus
jplotinus's picture

As I said, Rs hate Obama. I never tire of seeing new reasons for it. Thank you, CoolBeans, for your additions. Pray tell, though, why on earth was Romney offered up as an alternative?

For that matter, what makes you think the tendency towards expression of hatred will end with Obama? Once that path is entered, it can be hard to stop it.

My recollection of the early part of Obama's term is that he bent over backwards to appease Rs, thus sacrificing his support base. He has gone out of his way to distance himself from progressive solutions and has taken to channeling the likes of Coolidge (the business of America is business) and Hoover (prosperity ...around the corner) and not FDR at a time when he could have channeled the latter.

But, once again, that is easy for me to say because I'm not responsible for social cohesion. We hate ourselves. We take it out on ourselves and we blame each other for it.

One element of solution is to show a little respect.

Anyone agree?

Sat, 08/18/2012 - 22:20 | Link to Comment Iam_Silverman
Iam_Silverman's picture

"One element of solution is to show a little respect.

Anyone agree?"

 

So, the solution is respect?

Agree?  No!

All politicians are in the game only to better their own position.  They deserve no respect.  It is a nice gig with good pay and excellent benefits while they last, though.

 

What is your fixation with social cohesion, anyway?  We are a diverse and varied nation that depends on this difference to create our "American Dream".  If you don't have as much as your neighbor, your parents, your Hollywood idol, then you strive to achieve that level.  A strong dichotomy creates tension and stokes the work ethic of honest folks.

Then, there are those who choose to steal or defraud others to make their American Dream come true.

I shoot them.  May have to eat them too in the near future.  I have stocked a bunch of cheap teriyaki sauce from the Dollar Tree just in case....

 

Sun, 08/19/2012 - 11:18 | Link to Comment CoolBeans
CoolBeans's picture

I never like to label folks I don't know but perhaps Mr. Social Cohesion = Mr. Socialist.  They're big on this "social cohesion" stuff.

Sun, 08/19/2012 - 11:15 | Link to Comment CoolBeans
CoolBeans's picture

"Social cohension", "Respect".

Perhaps YOU should apply for a job as an Obama advisor.  Sounds like you have all the answers. You may have to work on your arguments, however as you have thus far only acted on defense vs. providing a list of redeeming qualities you see in him that would justify a second term for the worst president in history.   I am neither Dem nor Repub so don't go pinning all that Repub hate on me, Sir.

The man is an arrogant, power-craving, devisive, sarcastic, narcissitic socio-path who would say anything to get re-elected.  But, that is my humble opinion and why he would never get my vote.  To each his own and I respect your right to have a different prospective.

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