Unadjusted January Retail Sales Post Biggest Sequential Plunge In History

Tyler Durden's picture


The topic of BLS propaganda seasonal adjustments has been discussed extensively here especially in light of January's NFP beat. We'll leave it at that. However, we were rather surprised to note that the Census Bureau may have also ramped up its seasonal adjustment "fudge factoring" because when looking at the January headline retail sales data, which naturally was a smoothly continuous line on a Seasonally Adjusted basis, rising from $399.9 billion in December to $401.4 billion in January, something rather odd happened in the Unadjusted data set: the plunge from $459.8 billion in December to $361.4 billion in January, or -$98.5 billion in one month, was the biggest one month drop in retail sales in history. Now we won't say much on this topic, suffice to say that it would be far more useful if the BLS and Census Bureaus were to open up their models and explain in nuanced detail just what "old normal" adjustments they still incorporate into data sets. Because as many have already noted, seasonal adjustments used for data from 1980 to 2008 when "up" was the only allowed direction for everything, are completely irrelevant and misleading in the New Deleveraging Normal. Which reminds us: Zero Hedge will offer $10,000 to the first BLS employee to share with us the full and complete excel model set, including assumptions, data tables, and comprehensive output parameters that the agency uses to go from input A to output X. We hope that by spending that money we will finally do society a service and open up to everyone just how it is that the BLS adjusts its Non-Farm Payrolls data.

As for Unadjusted retail sales, here they are:

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Tue, 02/14/2012 - 10:15 | 2157110 JohnnyBriefcase
JohnnyBriefcase's picture

I'll reserve my judgement until the TV tells me how I feel about this.

Tue, 02/14/2012 - 10:22 | 2157143 Badabing
Badabing's picture

I love the smell of fake numbers in the morning!

Tue, 02/14/2012 - 10:24 | 2157156 MillionDollarBonus_
MillionDollarBonus_'s picture

I told you! Central banks are colluding with primary dealers to tighten credit and put the squeeze on retail stocks! When is the SEC going to put a stop to this manipulative tightening!? Central banks need to loosen monetary policy in line with poor consumer spending figures, and retail banks need to provide easy credit to boost aggregate demand.


Tue, 02/14/2012 - 10:26 | 2157165 brewing
brewing's picture

you're the best troll ever...

Tue, 02/14/2012 - 10:27 | 2157171 mayhem_korner
mayhem_korner's picture



...except all the other ones.

Tue, 02/14/2012 - 10:43 | 2157225 idea_hamster
idea_hamster's picture

OK -- Here you go:

the full and complete excel model set

=[type in number from AgitProp office]

Tue, 02/14/2012 - 10:52 | 2157261 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

No no. Here is the true excel model set:

Sales =[Whatever the squid and banksters say it is]

Tue, 02/14/2012 - 10:59 | 2157288 idea_hamster
idea_hamster's picture

You say that like "squid and banksters" are (i) different from one another, and (ii) not the "AgitProp office."  I beg to differ on both accounts!

Tue, 02/14/2012 - 11:28 | 2157368 redpill
redpill's picture

I assume Census uses X-12-ARIMA for their seasonal adjustment on this release like they do for their other releases, which basically means they put all the data in a giant sausage maker and some smooth-lined goop is supposed to come out the other side.  If you're morbidly curious you can look through the documentation and even download and install Win-X12 and mess with it to see what you can come up with, but it's not a particularly enjoyable experience from what I remember the last time I tried it.

Tue, 02/14/2012 - 11:57 | 2157411 Sun_Tzu
Sun_Tzu's picture

Let's see: An all-season record negative raw number becomes a small positive after "seasonal adjustment".  Translation: We lose $100 on every sale, but we make it up on volume.

Well, at least it does shed some light on the adjustments they use to get the implausible unemployment numbers!

Fine Art, Bitchez!

Tue, 02/14/2012 - 12:33 | 2157675 trav7777
trav7777's picture

all that matters now is whether the Fed is going to buy the stock market.  No clue how much more in profits can be wrung from this...the whole thing goes over the falls when iShit becomes passe

Tue, 02/14/2012 - 20:16 | 2159886 TexasAggie
TexasAggie's picture

Remember this is the modern GIGO. Garbage in, Gospel Out.

Tue, 02/14/2012 - 10:51 | 2157254 Don Birnam
Don Birnam's picture

"Zero Hedge will offer $10,000 to the first BLS employee to share with us the full and complete excel model set..."

I expect a return on this modest investment -- I would observe, however, that the source being a government clodpate, would have turned for much less.

Tue, 02/14/2012 - 10:29 | 2157176 LawsofPhysics
LawsofPhysics's picture

Is there a troll of the year award?  In the context of a trading site, MDB is simply the best.

Tue, 02/14/2012 - 10:35 | 2157202 Dr. Richard Head
Dr. Richard Head's picture

I would nominate Joe Weisenthal @TheStalwart as a pretty good paper troll.  He was expecting phenominal retail sales.  Hopium is a wonderful thing.

Tue, 02/14/2012 - 11:55 | 2157474 StockHut
StockHut's picture

Joe Wiesenthal is a cancer to the internet.  That man should be banned from publishing anything economic related.

Tue, 02/14/2012 - 10:45 | 2157229 brewing
brewing's picture

hard to beat "robotrader" though...

Tue, 02/14/2012 - 11:12 | 2157326 Zymurguy
Zymurguy's picture

Naw, you're not a troll if you truly believe what you say.


MDB doesn't really believe the stuff he says... I've seen a few cracks in his facade based on word choice, sentence structure, continuity, etc.  Robo on the otherhand is a true whack-job!

Tue, 02/14/2012 - 11:45 | 2157428 Almost Solvent
Almost Solvent's picture

And we used to get trolls like Johnny Bravo & Master Bates who would at least stick around and argue their troll droppings.


Most trolls these days are dump and run.


MDB is the best deadpan delivery I've seen with the written word - pure comic genius.

Tue, 02/14/2012 - 10:29 | 2157178 JohnnyBriefcase
JohnnyBriefcase's picture

I love you.

Tue, 02/14/2012 - 10:44 | 2157226 economics1996
economics1996's picture

MDB, that was funny!

Tue, 02/14/2012 - 10:47 | 2157240 Spastica Rex
Spastica Rex's picture


Tue, 02/14/2012 - 11:21 | 2157345 Kayman
Kayman's picture

Or we could declare financial and moral bankruptcy; start over by working for a living.

Tue, 02/14/2012 - 11:26 | 2157353 Eisenhorn
Eisenhorn's picture

In other news:





Tue, 02/14/2012 - 12:00 | 2157479 collon88
collon88's picture

MDB...I love the smell of your scarcasm in the morning.

Tue, 02/14/2012 - 10:26 | 2157166 pods
pods's picture

Well the radio was really giddy about it.  As they were about some new poll that Santorum was ahead.  That led the newscast.  

Funny though, they made it seem that there were only 3 candidates left on the GOP side.

Must have been an accident.


Tue, 02/14/2012 - 10:31 | 2157183 JohnnyBriefcase
JohnnyBriefcase's picture

Huh. I thought they were all just Obama in whiteface.

Tue, 02/14/2012 - 10:51 | 2157256 a growing concern
a growing concern's picture

Are you sure Obama isn't just a more well spoken Dubya in blackface?

Tue, 02/14/2012 - 11:07 | 2157318 francis_sawyer
francis_sawyer's picture

sure says "ummmmmm" a lot for being well spoken...

Tue, 02/14/2012 - 12:54 | 2157781 Jena
Jena's picture

Particularly when the telepromter isn't around to tell him what to say.

Tue, 02/14/2012 - 10:31 | 2157185 mayhem_korner
mayhem_korner's picture



Santorum lead the newscast?  Ahead of Whitney?  Who botched that one?  :D

Tue, 02/14/2012 - 10:35 | 2157199 Yes We Can. But...
Yes We Can. But Lets Not.'s picture

Prolly a Christian station

Tue, 02/14/2012 - 10:32 | 2157186 carguym14
carguym14's picture

Same here-over and over on the radio how "retail sales are up",recovery in progress.

The gov has to hope the majority stay dumb enough to buy into it......

Tue, 02/14/2012 - 10:36 | 2157198 SheepDog-One
SheepDog-One's picture

'Buying into it' has a sticking point when they cant afford to buy into enough food to have dinner.

Tue, 02/14/2012 - 12:20 | 2157601 FlyoverCountryS...
FlyoverCountrySchmuck's picture

The TRUTH no longer matters, just the narrative.

Isn't Obamunism WUNNERFUL?

Tue, 02/14/2012 - 11:17 | 2157334 Abiotic Oil
Abiotic Oil's picture

It's all about the delegates and he-who-shall-not-be-named actually has the most.  Popular vote is meaningless.

That's pretty funny though that "Frothy" Rick Santorum who couldn't get re-elected to his Senate seat and got tossed out on his ass by his constituents now thinks he is somehow electable on a national scale.


Tue, 02/14/2012 - 11:58 | 2157489 pods
pods's picture

I could tell it was a commercial for him.  Thought it was an ad for GM.

You almost cannot even listen to the headlines anymore.  

Tue, 02/14/2012 - 10:35 | 2157184 Shizzmoney
Shizzmoney's picture

LOL...thats even if they report this:

The plunge from $459.8 billion in December to $361.4 billion in January, or -$98.5 billion in one month, was the biggest one month drop in retail sales in history.

Oh yeah, I foresee a real BIG round of hiring this summer. 

In a sense, the corporations are in a bind here.  They have to hire debtors because the banks that lend THEM money, and the governments that give THEM tax breaks, are pressuring them to reciprocate whatever profts they do earn, back into the communities in the form of jobs nad investment.

The growth we have, isn't healthy growth.  It's just more McStuff being shuffled from port to port, store to store.  My friend and I on Sunday night, as we walked from a pub in Cambridge, were ASTONISHED to see the sale signs at the shops.  "40% off, 50% off, 75% off!" There is always Janurary sales in the retail sector....but NOTHING like this.

The MAIN problem the BLS doesn't foucs on is, these new jobs do not come close to the wages that keep up with the money supply (which will most likely expand again after more Eurozone shenanegians).  The lack of benefits leads to lack of security; which in turn, leads to public panic.  And when young people are not employed, as we see in Greece, act a fool. 

In the end, this all means more money for the banks (as consumers get serious about a)getting more debt to keep their McLife afloat or B) paying down debt=bad for economy) and landlords (as renting goes up for those under 35...again, more money for banks), and less for the retail shops (who will probably end up consolidating, which is NOT good for the free market). 

As Stephanie Kelton said on Twitter, "Workers are getting hammered".  And she isn't just talking about the dude bros hitting up $1 draft night at the local pub on a Friday night.

Nevermind that all of these "cooked" BLS U3 numbers WILL have a market correction at some point after the election.  They always do, no matter what sides wins.

2013 might be the Year of the Great Layoff.

Tue, 02/14/2012 - 10:15 | 2157111 Corn1945
Corn1945's picture

Government data is totally useless at this point.

Tue, 02/14/2012 - 10:21 | 2157139 brewing
brewing's picture

we'll see how people spend their money when gasoline gets to $4/gal soon...

Tue, 02/14/2012 - 10:33 | 2157190 Manthong
Manthong's picture

And so this is what the masses and young fund managers get with their morning coffee and croissants...

"The figures follow a report earlier this month that showed improvement in the labor market may help sustain spending. Employers added 243,000 jobs in January, the most since April, and the unemployment rate dropped to a three-year low of 8.3 percent, according to the Labor Department."


Tue, 02/14/2012 - 10:34 | 2157194 Cognitive Dissonance
Cognitive Dissonance's picture

Which explains Tyler's offer of $10,000 to lift the BLS veil.

"Zero Hedge will offer $10,000 to the first BLS employee to share with us the full and complete excel model set, including assumptions, data tables, and comprehensive output parameters that the agency uses to go from input A to output X."

Tue, 02/14/2012 - 10:49 | 2157246 disabledvet
disabledvet's picture

US Census data is the best data on the planet. Interestingly...only the Chinese have a history of "counting their people" the way the US has done since its inception. Moreover with the information age the need for really doing this anymore has pretty much been obviated. As data collection services explode throughout the planet "those who put the data to effective use first" win. That would be Time Warner, Bloomberg News, News Corp, Al Jazeera etc. "And there's your vast right wing conspriracy" as they say cuz everyone of these entities is run by "the utmost of so called conservatives." Don't worry tho...they won't be voting for Rick Santorum. (not that they're concerned about a President Santorum of course. They'd love that!) Insofar as labor numbers go--they'll take you bet i imagine...then reclassify the bulk of the American people as farmers! (and if you think that's funny...believe it or not that's EXACTLY how it was done for almost 300 years in the USA. It wasn't until World War II that reliable data for economic statistical purposes was created. Combined with a company called IBM and suddenly--

Tue, 02/14/2012 - 10:17 | 2157117 BW
BW's picture

Business is not booming.

Tue, 02/14/2012 - 10:20 | 2157132 LawsofPhysics
LawsofPhysics's picture

I disagree. A kid in our neighborhood could not find a job, so he started a repo business with his uncle.  Damn kid made more last month than I did right out of of school with an engineering degree.

Tue, 02/14/2012 - 10:25 | 2157162 mayhem_korner
mayhem_korner's picture



"repo-ing" is going to be big pretty soon.  'course it be the "looting" version, but that's just semantics.

Tue, 02/14/2012 - 12:11 | 2157565 aerojet
aerojet's picture

"It's a golden age for the repo men, one that will never end."

Tue, 02/14/2012 - 12:55 | 2157784 donsluck
donsluck's picture

On a personal level, that is the key. It is an aspect of the Dao, balance. As the corporations eat everything and exploit everyone, one by one individuals find their niche and succeed.

Tue, 02/14/2012 - 10:18 | 2157122 Dr. Engali
Dr. Engali's picture

Did you hear that Whitney Houston died?

Tue, 02/14/2012 - 10:19 | 2157128 Schmuck Raker
Schmuck Raker's picture

Better than expected.

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