Data Distortion: Retail Sales Plunged!

Complete and utter shock yesterday morning when Retail Sales rose 1% instead of declining 0.8%.  Let's put this into perspective:

• These are seasonally adjusted numbers
• The government statisticians put them together
• They are highly revised

• A little perspective - this was a monthly change (annual decline was 9.7%)

Here is a chart of the data series since inception.  Notice anything that looks bullish?

This chart is log-scale, so there aren't any optical illusions here.  The decline has been unprecedented.  Another way of looking at it is through the annual rate of change.  In the last recession (after 9/11), the series never really even went negative.  For anyone who thinks this is just a blip, take a look:

 

So, I have to conclude that the "jump" yesterday was noise at best.  These declines aren't restricted to our country, and they cross all sorts of categories that many seem to be finding somewhat surprising (PG, KFT, etc.).  Buckle up, as the comps are going to be tough for a few more months.  We had lots of years of above-trend growth (thanks to the piggy-bank effect of home equity extraction and the belief that savings aren't important), and we should expect years of slow/no/whoa.  As I wrote in December, we can't "save and spend" our way out of this.

Disclosure:  None