The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for August, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $363.7 billion, an increase of 0.4 percent (±0.5%)* from the previous month, and 3.6 percent (±0.5%) above August 2009. Total sales for the June through August 2010 period were up 4.7 percent (±0.3%) from the same period a year ago. The June to July 2010 percent change was revised from +0.4 percent (±0.5%)* to +0.3 percent (±0.2%).
Hmmmm…. looks pretty damn good right?
Well, let’s look inside.
Autos were down, but we already knew that from the previous auto dealer reports. So we’ll leave that alone, since it was “in the market” already.
Looking down the table we see that Electronics were down materially – a bit over 1%.
What was up? Food and beverage (1.3%), health and personal care (0.6%), gasoline (1.9%), clothing (1.2%), sporting goods (0.9%) and general merchandise (0.4%)
Meh. Food and beverage and gasoline are not good, those are bad – those are non-discretionary purchases, mostly. Clothing and sporting goods both correlate with back-to-school. But so does electronics (specifically, computers for kids going to college) and they were down materially.
So what do we learn from this?
That “back to school”, despite the whining from retailers, wasn’t really all that bad – for necessary items. For discretionary purchases the month wasn’t nearly so solid. Cost of living increase is absorbing the alleged gains.
Indeed, the entire gain of food and gasoline sales, $1.316 billion, compares in an interesting fashion with the total non-auto headline gain of $1.923 billion – that is, these non-discretionary purchases comprised about 70% of the total “improvement” ex-autos.
No wonder people aren’t buying cars, TVs and computers - they don’t have any money left!
How do you spell “squeeze” on the consumer’s budget, and further, despite the claims of “no inflation”, perhaps you can square this against the non-discretionary increase in purchase allocations against food and gasoline which, of course, The Fed and “economists” don’t count in the “Core” inflation rate.
