OOPS!!! Missed again. The winter weather storyline about retail sales collapsing is looking old and tired at this point, as retail sales continue to suck into summer. Maybe it is too sunny and too pleasant for people to buy stuff they don’t need with money they don’t have. The miniscule 0.2% increase in June retail sales confirms my many previous Retail Death Rattle articles about average Americans being tapped out and the shitty part time service jobs not filling the bill. When you consider the true rate of inflation running above 5%, these retail sales figures are a disaster. But of course the corporate MSM mouthpieces are already doing their darndest to paint a rosy picture and promote the falsehood of economic recovery. If the Fed can just keep interest rates at 0% for a few more years, the average American will surely benefit from the trickle down, as the oligarchs cups overflowth.
Rather than listen to a CNBC bimbo or watch some Wall Street economist hack, let’s go to the actual government propaganda report:
https://www.census.gov/retail/marts/www/marts_current.pdf
Here are my observations:
- Retail sales were up by a whole $1 billion over May and up $3 billion over April. Not exactly a booming consumer recovery. And when you open the hood and look at the engine, it gets much worse.
- Total retail sales are up by only 3.6% in the first six months. When you remove the debt financed auto sales, it drops to 2.6%. Let’s be generous and say that prices are only rising at 5% on an annual basis. That means that real retail sales are falling by 2.4%. Is this being reported by the MSM? Hell no. They have a job to do – keep you ignorant and in the dark. But, the fact that real retail sales are falling is proven by the collapsing retail profits and thousands of retail stores being shuttered.
- Now auto sales are falling. Auto sales were $700 million lower in June than July. That’s funny because I keep reading about auto sales being at seven year highs. A critical thinking person might wonder how this could be. The automakers wouldn’t be jamming their inventory down the throats of their dealers and recording sales, would they? If they can’t generate increasing auto sales with 7 year o% loans to subprime deadbeats and dupes, then the jig is up.
- Retail sales were $18 billion higher than last June. That is a 4.3% increase. Excluding the $5.4 billion of auto “renting” disguised as sales, retail sales were up only 3.7%. The majority of gains were from food, pharmacy, and online retailers. This is all inflation generated gains.
- Discretionary spending is dead. Electronics, appliances, and furniture stores had flat sales in June versus May and versus last June. How can we be having a housing recovery if there is no increase in purchases for homes? Sporting goods, books, and hobby stores have seen their sales plunge in the first six months of 2014.
- Restaurant sales fell in June. With food prices rising rapidly, this means traffic is collapsing. Ask Olive Garden.
- Even on-line sales have slowed as they only rose by 8% over last year. For years these sales grew by 15% to 25%. Maybe taxing internet sales has an impact.
Average Americans have run out of discretionary cash. They are using their credit cards to pay their real estate taxes, utility bills, and income taxes. The retail implosion will continue unabated no matter what propaganda is spouted by the MSM.
June Retail Sales Miss Across The Board, May Revised Higher
Submitted by Tyler Durden on 07/15/2014 08:56 -0400
Following disappointing retail sales number for both April and May, or two thirds of Q2, there was hope that June would finally be the month retail sales would soar. Alas, that would not be the case, following the release of the latest retail sales data by the Department of Commerce which reported that in June retail sales rose just 0.2%, well below the 0.6% expected and matching the lowest end of the forecast expectations (from 0.2% to 1.1%).
Misses were also reported for retail sales ex-autos (0.4%, Exp. 0.5%) and ex-autos and gas (0.4%, Exp. 0.5%). Perhaps the only saving grace was the upward revision of May data from 0.3% to 0.5% for the headline number and from 0.0% to 0.3% for the ex-autos and gas. If anything, however, today’s retail sales increase which was the slowest in 5 months confirms that the trend we warned about in April, namely that the US consumer tapped out in March to fund that month’s mad spending spree, and the spending trend has been deteriorating ever since.
There was some good news in today’s report which was the retail sales control group, which rose 0.6% compared to estimates of 0.5%, and the May revision of 0.0% to 0.2% means that GDP beancounters will likely end up adding a few basis points to their Q2 GDP estimate even as consumers enter Q3 in the weakest shape they have been since the polar vortex.
The breakdown of retail sales by business was rather paradoxical, because while automakers reported yet another surge in June car sales, retail sales for the category per the Dept of Commerce showed a -0.3% decline. The other big drop? Building materials and garden equipment supply dealers which slid -1.0%. Hardly a positive for that other key component to US GDP – housing.
Frankly, it’s surprising that the increasingly unemployed, destitute, American populace isn’t out spending money they don’t have – to prop up the fortunes of the people that created this mess in the first place.
My anecdotal evidence. I make a weekly trip to Home Depot depending on what I am fixing on my 100 year old cape. Last Saturday early afternoon I needed some Wood Hardener (no really;
http://www.homedepot.com/p/Minwax-1-Pt-High-Performance-Wood-Hardener-41700000/100376253 )
For some rot I was digging out under the front door. More employees than customers, only two register open at the front and no lines on what is purported to be the busiest day of the week. This Home Depot has no competition other than itself within 30 miles on busy route 1. Most vegetables and plants marked down and the shelves were full. Maybe everyone was at the beach.
Bob.
Wood Hardener hummmm, wonder if SSS drinks the stuff?
Wolverine Worldwide to close stores
By Erin McCarthy
Wolverine Worldwide unveiled plans Tuesday to close about 140 stores over the next 18 months and to consolidate store operations to improve its profit.
The maker of Hush Puppies and Merrell shoes expects to record pretax charges related to its strategic realignment in the range of $30 million to $37 million, between now and the end of the 2015 fiscal year. About 60 stores will close by the end of the current fiscal year, with the rest shutting their doors by the end of 2015, it added. The closures will primarily be Stride Rite stores.
Wolverine also aims to manage its retail fleet more efficiently, and in turn will consolidate store operations and field support teams. It also plans to initiate other organizational and infrastructure changes, it said. The plan should result in pretax benefits of $11 million annually, which will be used in part to boost growth in Wolverine’s wholesale operations.
“The realignment of the consumer-direct business is intended to optimize the fleet of retail locations, right-size the supporting infrastructure, address a fundamental shift in consumer shopping behavior and allow for greater focus on important omni-channel initiatives,” the company said.
Think I posted this a week ago, but it fits here, too:
WAL-MART CEO: Things Aren’t Getting Better For America’s Middle Class
Full Story Here
In an interview with Reuters at the retailer’s headquarters, Bill Simon, the president and chief executive officer of Wal-Mart U.S., said, “It’s really hard to see in our business today … that it’s gotten any better.”
He added: “We’ve reached a point where it’s not getting any better but it’s not getting any worse – at least for the middle (class) and down.”
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Walmart is a bellweather for consumer spending strength, so it’s worth watching. If they’re struggling, you can only imagine how many others are.
Watched one of those real smart economists on the 6:00 news the other day while visiting the folks. She was perplexed at the drop of retail sales, Walmart has lost money seven quarters in a row, fast food chains are losing money, but stores like Macy’s and Neiman Marcus etc are doing good.
She couldn’t comprehend that the middle class is hurting while the wealthy are doing just fine.
“Watched one of those real smart economists on the 6:00 news the other day while visiting the folks. She was perplexed at the drop of retail sales,…”
Not real smart, then, is she?
Well…I was gonna go shopping but It’s been really hot out….