It’s odd how Retail Sales  could have the nerve to be up when everyone knows it should be down. How does it do that?
Simple, really, higher prices where demand is not going to retreat quickly. Gasoline. And the stuff that uses it.
The problem is that the only really meaningful measure of Retail Sales (year-to-year) is gross dollars. I don’t know one way or the other, but I suspect the dollars are not adjusted for inflation.
Interestingly enough, the Wall Street Journal Online (in the subscriber area) was good enough to run a graph showing Increase in Retail Sales against another showing the same without gasoline station sales. The .3% increase (compared to an anticipated .4% decrease) appears to be slightly impacted by gasoline station sales (without the gasoline, it appears to be a .1-.2% decline). Although, this analysis doesn’t really account for the impact of the higher gas prices on retail prices (strangely enough meaning the numbers get reflected twice, kind of like some of our taxes).
Regardless, it’s really all a bunch of speculative mumbo-jumbo IMO. The Annual change in Retail Sales is a deceptive number, and it surprises me that this news caused the stock market to swing up today. At the same time, we’re getting more and more announcements of retail layoffs and a government desperate to stay in power is doing little more than tossing coins out the windows in the supposed hopes that they’ll show up in the retail shops… ain’t gonna happen. And the real hope is that voters will think they got a nice gift from Uncle Sam. Problem is, we’re just borrowing from an already bleak future.
Warning: I AM NOT A PROFESSIONAL ECONOMIST (nor do I play one on TV). I just have an opinion.
What’s the macro view here? I suspect we’re entering an economic adjustment. It makes me wonder if we need to bloat up the economy any further or let it settle to its natural and appropriate free market state. Interest rate adjustments are fine, but let’s stop messing around and running a shell game that’s just going to make things worse in the future.
Hat Tip: Wall Street Journal Online .