The Big Retail Sales Lie

There’s a direct correlation between the scale and quantity of lies coming from Hillary Clinton and the Government. Why? It’s election season, of course. It’s easy enough to dismiss Hillary’s plea for debate viewers to go to her campaign website to see “fact” checking.  We know how easy it is for her to hide the truth when she has assistance from the State Department, FBI and Obama.  If you believe Hillary Clinton, you also believe in the Easter Bunny.

But it’s also easy to fact check the Census Bureau’s retail sales reports.   Now, it’s easy enough to believe that the Government would manipulate the statistics in order to help the incumbent party maintain control the White House.  But it’s also easy to fact-check the Census Bureau’s tabulations for monthly retail sales, notwithstanding the fact that the Census Bureau is caught producing fraudulent statistics on a regular basis.

Today, for instance, they released their “advance estimate” for retail sales for September. The Census Bureau would have us believe that retail sales increased .6% from August to September.  But this was based on the Government’s politically expedient “seasonally adjusted” calculation.

Simple math disproves the validity of the “adjustments.”  The report shows “not adjusted” total retail sales as estimated by the Census.  August was $471.3 billion – or $15.2 billion per day.  September was $445.4 billion – or $14.8 billion per day – down 2.6% from August to September on a per day basis .   In retail sales terms, a 2.6% decline month to month is equivalent to a steep plunge.  (click image to enlarge)

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Theoretically, the seasonal “adjustment” offsets the day-count difference between August and September. But what about the 3-day Labor Day holiday weekend?   This year Labor Day fell on September 5.  Presumably that weekend should have compensated for any “seasonal”differences between August (back to school?) and September.  BUT on a sales/day basis, September retail sales plunged from August.

Here’s a definitive “fact check” on the Census Bureau retail sales report.  The retail sales report is showing a 1% increase per the “adjusted” number from August to September. However,  Black Box Intelligence, the best source for both private and public company restaurant industry data, is reporting that restaurant traffic fell 3.5% in September from August.  In fact, traffic counts have dropped at least 3%  in four of the last six months. Same-store-sales dropped .5%.

This private sector source of data is consistent with data that I have been presenting in the Short Seller’s Journal for trucking and freight shipments for August and September and for actual auto sales numbers, which are declining at an increasing rate, along with the rise in auto loan delinquencies.   In fact, according to Fitch the default rate in subprime auto loans is now running at 9% and is expected to be at 10% by year-end.  Fitch is usually conservative in its estimates.  I would bet the real default rate will be well over 10% by the end of 2016.

One final significant datapoint released last week was auto sales for September. The “headline” report showed a 6% SAAR (Seasonally Adjusted Annualized Rate) gain in September over August for domestically produced autos. However, auto sales typically increase from August to September as Labor Day sales drive September car sales. Year over year, domestic car sales plunged 19% and truck sales were down 1%.

Now for the reality-check. As reported by the Wall Street Journal, September sales for GM, Ford and Chrysler declined 0.6%, 8.1% and 0.9% respectively. Toyota and Nissan reported gains while Honda’s sale dropped. Moreover, it took heavy discounting to drive sales. In fact, incentive-spending by OEM’s on a per-unit average basis set a single-month record, topping the previous single-month record set in December 2008. Think about that for moment.  – from the October 9 issue of the Short Seller’s Journal

The bottom line is that most, if not all, data coming from private-sector sources conflicts and undermines the “seasonally adjusted” garbage data reported by the Government. Just like all other news reported by the media that is sourced from the Government, the Government economic reports are yet another insidious form of propaganda tailored for political expedience.  But propaganda does not create real economic activity and the middle class is becoming increasingly aware that it’s being told nothing but lies from the Government.  Today’s Government generated retail sales report for September is a prime example.

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9 thoughts on “The Big Retail Sales Lie

  1. Dave, linked you up on Zero Hedge today. I think it is
    a shame that Zero Hedge does not post your work.
    Hopefully the link will bring more eyeballs over here.
    Have a good weekend, see you next week homie.

    1. Thanks Kaiser – appreciated it. They’ve posted my work occasionally. For some reason they’ve ignored my work going back to the days when this blog was The Golden Truth.

  2. Bill Holter says World War III is now inevitable.

    To be MonsantObama’s Nobel Peace (Of Shit) Prize legacy????

    http://www.jsmineset.com/2016/10/14/the-final-act-will-be-world-war/

    Bill Holter says, now it’s either World War III OR the Second American Civil War. I say: Both of them together can be a possibility. (Or at least major nationwide American civil disturbances, if not official “Second Civil War”.) If you know your history – especially Russian history – none of such conjectures are far-fetched. All of the October Revolution i.e. Bolshevik uprising of 1917 & following Russian Civil War (Whites vs Reds) were smack in the middle of ongoing World War I (or the Civil War continued after end of World War I).

    Start preparing with a mental mindset of heavy internet censorship &/or arbitrary internet outages. The alternative media we’ve come to rely on so dependably for past many years CANNOT be taken for granted anymore!

    ;-(

    Handover of the internet authority on September 30 from national sovereignty to some United Nations (or IMF or BIS) body was not a coincidence. Timing of all these events are eerily peculiar.

  3. OK, repeating myself a tad…but the day producers hold up supplying the market..
    & holding back stock is the day this blows up. When producers stop pushing for
    “market share” and realise that the demand for money is almost infinite & there is room
    for almost all existing suppliers, well when the ordinary man realises hes’ gonna
    need metal to survive the new monetary paradigm..I think there will be a massive
    shortfall in the supply chain…JMO …also Kaiser is correct…big thumbs up on that
    Mr Souza!!!!!

  4. Oh dave..woops last comment i’m still on the SDR article
    luckily I know…you know i’m a nut..lol BBBBut the irony
    in the housing market is that Central banks are doing
    what should be happening in Au Ag..I’d love to know how
    much of the housing market is being held back or off
    the market..aren’t the Fed still buying MBS ? millions
    of homeless…and millions of homes on the feds balance sheet
    …I don’t know to be honest..but they must be holding
    stock off the market to complete this fraud…IMO

  5. Holiday sales are forecast by the NRF to increase 3.7% in 2016 over 2015. I have serious doubts that sales will increase at all. In fact I believe it likely that holiday sales will decline in 2016, and the retailers are going to be hurt.

    A recent article stated that 70% of Americans have less than $1,000 in savings. This puts the vast majority of the population dangerously close to financial disaster due to an unexpected bill or medical emergency. But according to an article I read recently, that’s okay cause the majority of Americans have access to $1,000 in credit. So, they can borrow enough to cover the trip to the emergency room.

    It seems the media is resorting to absurd lengths to make us feel like the economy has recovered and we should all throw caution to the wind and go out and spend what we don’t have.

    1. KJH,

      That article that you refer to that says that Americans have less than $1000 in savings turns out not to be true. The survey, which was done by GOBankingRates, only asked people how much they had in their “savings account”. Many people have the majority of their savings in checking accounts, CDs, mutual funds, brokerages, retirement plans etc…

  6. This is it folks, it’s T minus 24 hours. (Actually quite literally, T minus 20 hours now.)

    Brace for impact. This is going to be huge, and promised as take-down of the entire corrupt neo-liberal Media Industrial Complex i.e. PROPAGANDA PRESSTITUTES, over & above Hitlery’s campaign.

    Go to the following page to keep track, assuming Facebook & twitter don’t go into full censorship mode by tomorrow. OR if the internet stays alive & some false-flag attack involving Russia – desperate attempt to start World War III in Syria doesn’t start by then:

    https://www.facebook.com/ProjectVeritas

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