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CHART OF THE DAY: PUTTING RETAIL SALES IN PERSPECTIVE

30 November 2009 by Cullen Roche 3 Comments

Investors are focused on retail sales today and the potential for a disappointment in total holiday spending, but a closer look at the longer-term trend in retail sales shows that the consumer isn’t actually rebounding at all.  In fact, retail sales have increased less than 5% over the course of the 50%+ rally in stocks.   Is this is a sign that retail sales are permanently moderating as consumers deleverage and become more prudent or is this simply a blip on the radar before spending zooms back to all-time highs?  Equity investors are certainly betting on the latter.

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Cullen Roche

Cullen Roche

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Comments
  • Rob

    Another way of looking at things is that retail sales are at about the level they were in 2005 and stocks are at about the level they were in 2004. (Stocks are overvalued but probably no more overvalued than in 2004.) The market ran for 3 years following 2004 before it declined.

    11/30/2009 at 1:14 PM
  • EL

    I would also add that emotionally and financially the average consumer is lost somwhere in the 1990′s as it pertains to their comfort level with household finances.

    11/30/2009 at 1:56 PM
  • letmeeatmywaffle

    as per cnbc/obama admin , retail sales and black friday dont matter anymore!
    move along looky lou’s, nothing to see here… everything is fine in obamaworld… and if you need more than 2 minutes of gov.hate then blame bush…always makes me and my progressive polanskites happy

    11/30/2009 at 4:08 PM