Fifteen Greater Than Fifty: Red Hot This Is Not

American consumers binged again in April, though not much more than they had in March. Previously delivered government stipends continue to inflate retail activity if not much else. According to the Census Bureau, retail sales rose “just” 0.7% last month when compared to the month before it. Given that March had been up (revised) nearly 11% versus February, any even small positive number for the latest monthly figure indicates how the splurge remains in effect.

It does, however, bring up the possibility at this stage if absent Uncle Sam’s generosity, then what? Once the sugar rush wears off and the consumer comes back down, what’s underneath all this? If it’s full recovery, so be it, the economy off to the races with a potential path to possible inflation.

Anything less than that, like what happened late last year when the checks and artificial bonuses ran dry, we’re right back in the (disinflationary) mess.

Because of that implication, despite the uncharted territory for retail sales and the huge numbers that would create on its own, let alone how they’ve been further boosted by base effects, these gigantic positives can’t really register. After rising (revised) 31.7% year-over-year (unadjusted) in March, the new April 2021 estimate for total retail sales was an almost comical 51.4% greater than the same for April 2020.

Greater than fifty percent. Fifty.

With that there is no purpose in plotting it on any chart; it either surges way off the top of it, or when you adjust the scale all the rest of the data is shrunk down to relative nothingness.

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Disclosure: This material has been distributed for informational purposes only. It is the opinion of the author and should not be considered as investment advice or a recommendation of any ...

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