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I think you may have got this right. It would be helpful to see the boutique/small shops report as opposed to the Big Box stores report. Sure the economy is looking good for many while just as many go under.
Also, many people are shopping at Walmart, etc. for basic necessities such as food, and that figure may be glumped in with overall sales. Statistics (apologies to those who trust in them) can be so deceiving, there's always a spin.
And, as per Mircea's observation, above, higher prices translate to higher sales reports. Was that higher $ sales, or higher volume??
This is what happened in the great depression as companies consolidated, the big survived and grew.
These stats do drive me nuts, just look at the employment numbers they reported a couple months back
The government reported that non-farm payroll employment increased by 151,000 in October 2010. That sounds like good news. However, the more you dig into the actual numbers you see it is just more manipulation of these numbers. When the Bureau of Labor & Statistics (BLS) compiles the numbers they do a “seasonal adjustment” meaning they typically change the prior year’s benchmark number to reflect changes in the workforce etc. In October 2008, the figure that we needed to surpass in 2009 was 840,000 jobs. However, in 2009 we came in at 870,000 jobs, which was a small gain.
So, instead of using 870,000 jobs (the figure from 2009) or more as the new bar we needed to reach for job growth, the BLS lowered the bar to 768,000 jobs for the October 2010. Then they released a statement that said 874,000 jobs was a gain of 151,000 jobs. Also, other factors make the numbers not add up correctly. According to John Williams at Shadow Government Statistics, the BLS' fiddling with the figures via what he calls “seasonal-factor games”, actually created 200,000 phantom jobs last month. It also explains why seasonally adjusted payrolls were revised upward by 110,000 jobs in September 2010, including 56,000 jobs in August 2010.
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Originally Posted by slackjaw
LOL yeah why on Earth would I assume this headline: "So much for the "best Christmas numbers since 2008" ..reality -4.1%" was about the Christmas shopping period? Crazy of me I know.
Apparently you don't have to fess up, since you have now decided you were just referencing one week afterall the whole time.
It is just like news lead ins, they give the hook and then all the details later.
When the Bureau of Labor & Statistics (BLS) compiles the numbers
Good stuff, and easily a thread to itself. I find discussions about ways to measure unemployment fascinating, seems like there is no real right way that doesn't have gaping holes in the logic of it.
Food and energy are up 18% over one year ago; something like that could definitely affect Walmart and Target as both do sell food now.
If you are referring to that "food up 18.5%" thing, from what I saw it came from a graph that showed the price farmers are getting paid for commodities like beef, soybeans, etc is up 18.5% from a year ago.
What your consumer pays in the grocery store is totally different, much of the price at the register is transportation, manufacturing, packaging, markups all along the way right up to the grocery store that puts it on the shelf. Unless they all moved in unison that might be a pretty raw number to use for impact to consumers' bottom line grocery bill.
Thinking about the whole Christmas sales thing, it seems that if sales (not $, but volume) are really up this year it's because there's a sense of abandon among many of us. We're sick of the sick economy and just want things to be "normal" again (which won't happen, but we want it anyway). We want Christmas shopping like in the old days. We're tired of being so tight with our money. Especially retirees who know there isn't a forever. So this year instead of being frugal we just spent.
On another note, it would be interesting to see how much of the sales were cash vs. credit card sales in comparison with last year. If it's credit card sales causing the spike, my theory (above) is probably true. The sales would not reflect a stronger family economy, just a new sense of abandon (live for today, the h*** with tomorrow....).
Thinking about the whole Christmas sales thing, it seems that if sales (not $, but volume) are really up this year it's because there's a sense of abandon among many of us. We're sick of the sick economy and just want things to be "normal" again (which won't happen, but we want it anyway). We want Christmas shopping like in the old days. We're tired of being so tight with our money. Especially retirees who know there isn't a forever. So this year instead of being frugal we just spent.
On another note, it would be interesting to see how much of the sales were cash vs. credit card sales in comparison with last year. If it's credit card sales causing the spike, my theory (above) is probably true. The sales would not reflect a stronger family economy, just a new sense of abandon (live for today, the h*** with tomorrow....).
Very good points.
Another factor we need to consider is how people are using consumer debt for purchases. Prior to the crisis, a common theme for a majority of people would be to charge items onto their high rate credit cards. They would then refinance or open an equity line of credit to pay off the cards and go out and do it all over again. No debt was ever reduced. Most consumers just used the equity in their house to build up even more debt, fueling the consumer spending before the crisis. Now when we see peaks in spending we are seeing a corresponding peak in consumer credit. Then, over the next few months, spending drops back down as their excess income is used to pay down the debt.They can no longer refinance or draw equity from the house forcing them to cut back on spending while they lower the balances. This is not a sustainable way to grow consumer spending. The Retail Recovery Is Built On Credit Consumers Can't Pay And It Won't Last
With foreclosures now taking on average almost a year and a half to complete, we are seeing millions of people who are living mortgage a rent free. This has to help consumer spending, as long as they have a job or assets to spend on pure consumption. With more option ARMS loans resetting this year, we should see this trend continue.
we are seeing millions of people who are living mortgage a rent free. This has to help consumer spending, as long as they have a job or assets to spend on pure consumption.
I saw an article relating to this, I believe they called it the Stealth Stimulus. People getting to live with no housing costs and how the freed up spending money goes.
Some of them have taken a step further and rented it out.
The other factor to be considered in the consumer equation is that there is likely a lot of "anticipatory" buying going on because of the (very well-founded, in my opinion) fear of massive inflation coming down the pike. Anything that is "petroleum intensive," either in content, production, or transport is poised to cost a hell of a lot more soon. So, too, with the trashing of the dollar, is a lot of the imported stuff that we like so much. So, a lot of people probably have stretched themselves financially to make purchases in the last few months, figuring that whatever they are buying is going to be priced a lot higher in pretty short order. That isn't representative of an improving economy; it's merely the shifting of a future purchase to the present. It means the hundred extra widgets that got sold in December, bolstering the sales numbers, won't be getting sold next July.
I saw an article relating to this, I believe they called it the Stealth Stimulus. People getting to live with no housing costs and how the freed up spending money goes.
Some of them have taken a step further and rented it out.
I call it the Ipad affect. When you see that family with tons of new gadgets yet you know they don't make a lot, you can figure out they are in forclosure
The other factor to be considered in the consumer equation is that there is likely a lot of "anticipatory" buying going on because of the (very well-founded, in my opinion) fear of massive inflation coming down the pike. Anything that is "petroleum intensive," either in content, production, or transport is poised to cost a hell of a lot more soon. So, too, with the trashing of the dollar, is a lot of the imported stuff that we like so much. So, a lot of people probably have stretched themselves financially to make purchases in the last few months, figuring that whatever they are buying is going to be priced a lot higher in pretty short order. That isn't representative of an improving economy; it's merely the shifting of a future purchase to the present. It means the hundred extra widgets that got sold in December, bolstering the sales numbers, won't be getting sold next July.
That may be a factor for some but not me, I am in the deflation camp. Once we deflate then I worry about inflation.
That may be a factor for some but not me, I am in the deflation camp. Once we deflate then I worry about inflation.
We are going to have both inflation and deflation: deflation in real estate and equity markets and rampant inflation in basic commodities and imports.
In other words, the stuff most Americans own is going to deflate and everything they need to buy to live is going to inflate. The perfect economic storm.
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The sales would not reflect a stronger family economy, just a new sense of abandon (live for today, the h*** with tomorrow....).
