Good news: Christmas has been saved!
No, I'm not talking about Rudolph getting over his social inferiority complex with the help of a tooth-obsessed elf and a crazed silver-and-gold prospector. I'm talking about the monthly US retail sales numbers for November. I used to blog these releases pretty faithfully, but stopped doing a couple of months ago when the tanking USD distracted my attention. Today's mediocre numbers and the spin the retail industry is trying to give them give me just the excuse I need to get back into the groove.
Shoppers showed a bit of cheer at the cash registers in November, boosting sales at the nation's retailers by 0.1 percent.Wow. It's amazing what a 0.1% growth in retail sales can do!
The newest snapshot of consumers' buying appetite, issued by the Commerce Department on Monday, turned out to be somewhat brighter than the flat showing in sales that economists were expecting.
To be sure, consumers were more selective in their purchases in November, compared with October. Retail sales increased by 0.8 percent in October from the previous month, according to revised figures. That was much stronger than the 0.2 percent increase first estimated. . . .
"Christmas has been saved," declared Anthony Chan, senior economist at JPMorgan Fleming Asset Management. "It's not going to be a blockbuster Christmas. But it will not be as some feared � that Christmas is not going to happen this year."
Retail sales have now racked up three positive months in a row, a marked recovery from the one on, one off days of the spring and summer.
Monthly growth in retail and food service sales (SA) for 2004:
January . . . . 0.5%
February . . . 1.0%
March . . . . . 2.1%
April . . . . . . -0.8%
May . . . . . . . 1.4%
June . . . . . . -0.7%
July . . . . . . . 1.0%
August . . . . -0.3%
September . . 1.6%
October . . . . 0.8%
November . . 0.1%
That being said, it's also no surprise that total sales have risen 7.2% over this time last year at the same time that personal savings have fallen 86%. Yes, 86%. The biggest gainer over the last 12 months has been gasoline sales, up a big 24%. Number 2 is building material and garden equipment retailers, up 12.8%. In fact, only these two plus "nonstore retailers" and "food services and drinking places" were above the 7.2% average -- the other nine categories were below, in some cases (e.g. cars and sporting goods stores) far below.
Falling gas prices plus the end of the housing bubble should take a big bite out of these retail numbers in the coming months. That and the savings rate falling to 0.0%. But at least Christmas 2004 is saved!