...and lays down cover for the Democratic regime in Washington. Claims that "retailers can breathe a sigh of relief", due to a 6.6% increase in sales from Black Friday 2010, are nothing more than yet another attempt to lull us into a false sense of economic well-being, while we await the expression of surprise three months down the road when the actual sales figures for the holiday season turned out to be much more tepid than usual.
When the broader picture is examined, and trend lines are studies, things look a lot worse close up than they actually appear:
The headline number looks good. Retail sales in October were a record $397.7 billion, up from September, and up 7.2 percent from October 2010. But some of the biggest and most rapidly growing components of retailing include segments that we don't really think of as shopping. The biggest retail sector is cars and car parts, which account for about 18 percent of the total; they're up 10.1 percent so far this year. Food and beverage stores — i.e. groceries—constitute about 13.2 percent of sales, and they're up 5.6 percent through the first ten months. Gasoline stations alone account for 11.7 percent of total sales, and their sales are up 19 percent so far in 2011, thanks to higher gas prices.
For those looking for a safe place to park their money, how about investing in publicly-held car parts companies? With new car prices continuing to rise due to new environmental regulations, and a used car shortage (thanks, "cash for clunkers"!), folks have no choice to keep what they have running. Like in Cuba.
But if you add cars to food and gasoline, you'll see that America's spending is up - on the necessities of life. Not on new iPods, Kindles, and other expensive holiday paraphernalia. Which is, alas, no surprise to retailers:
If you factor out clothing - a necessity for most of us - and factor in inflation, retail is getting killed this year. None of which is mentioned in any of the "Black Friday" success stories being put out by the media. Furthermore, is the 6.6% increase in Black Friday sales an indicator of future increases for the holiday shopping season? Or are huge sales backed by saturation ad campaigns just moving demand up, resulting in much smaller increases (if any) from now till Yule?
A miserable 2011 Christmas for the economy is coming. You heard it here first. But don't worry, the media won't hear it at all, and neither will the resident, as he will most likely be enjoying yet another Christmas in Hawaii this year, while his subjects huddle for warmth...