Pragmatic Capitalism

Practical Views on Money & Finance

Retail Sales – Good Enough

This morning’s retail sales report showed some small signs of deterioration, but still pointed to a positive overall level of demand in the economy.  According to the Census Bureau retail sales came in at a year over year rate of just over 4%.  This has tended to be a pretty good leading indicator of recession so it would be unusual to see this sort of figure during a recessionary environment.

In my opinion, the budge deficit and modest improvement in private investment are still enough to keep the consumer spending at a slow pace.  That means no recession, tepid growth, modest corporate profit expansion and a jobs environment that is okay, but not strong enough to bring us anywhere near full employment.

Here’s more from the CB:

“The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for January, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $416.6 billion, an increase of 0.1 percent (±0.5%)* from the previous month and 4.4 percent (±0.7%) above January 2012. Total sales for the November 2012 through January 2013 period were up 4.5 percent (±0.5%) from the same period a year ago. The November to December 2012 percent change was unrevised from +0.5 percent (±0.3%).

Retail trade sales were up 0.1 percent (±0.5%)* from December 2012 and 4.1 percent (±0.8%) above last year. Nonstore retailers were up 15.7 percent (±2.3%) from January 2012 and auto and other motor vehicle dealers were up 9.4 percent (±2.3%) from last year.”

Chart via Orcam Investment Research:

Got a comment or question? Feel free to contact Cullen via email here or on Twitter here.
Cullen Roche

Cullen Roche

Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering asset management, private advisory, institutional consulting and educational services. He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance and Understanding the Modern Monetary System.

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