Consumers rise again after July respite.
Please consider the Census Department report on Advance Retail Sales for August 2026.
Advance estimates of U.S. retail and food services sales for August 2026, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $773.9 billion, up 1.2 percent (±0.4 percent) from the previous month, and up 6.0 percent (±0.5 percent) from August 2025.
Total sales for the June 2026 through August 2026 period were up 6.0 percent (±0.5 percent) from the same period a year ago.
The June 2026 to July 2026 percent change was revised from down 0.6 percent (±0.4 percent) to down 0.5 percent (±0.2 percent).
The key phrase above is “adjusted for seasonal variation and holiday and trading-day differences, but not for price changes.”
The report only lists nominal sales, not real (inflation-adjusted sales). It’s real sales that feed GDP.
Month-Over-Month Nominal Retail Sales
- Total: 1.2 percent
- Excluding Motor Vehicles: 1.4 percent
- Excluding Motor Vehicles and Gas: 1.2 percent
- Motor Vehicles: 0.6 percent
- Nonstore Sales: 2.6 percent
- Food Service: 1.2 percent
- Food Stores: 0.4 percent
- Gas Stations: 3.1 percent
- General Merchandise: 0.7 percent
Real vs Nominal Retail Sales Month-Over Month Percent Change
- Nominal Total: 1.2 percent
- Real Total: 0.8 percent
The CPI was up 0.4 percent. Subtract that from nominal sales to get real sales.
Real vs Nominal Advance Retail Sales percent Change from Year Ago
Nominal sales are up 6.0 percent from a year ago. Real sales are only up 2.6 percent.
The difference is the inflation gap, currently 3.4 percentage points out of 6.0.
Thus, inflation accounts for 57 percent of the increase in nominal retail sales from a year ago.
Real vs Nominal Retail Sales in Millions of Dollars
There was a massive surge in inflation in 2020 and 2021 with three rounds of largely unwarranted and definitely excessive rounds of fiscal stimulus under Trump and Biden.
Trump wanted more fiscal stimulus than Congress gave him. Then Democrats went totally nuts under Biden.
The Fed compounded this error with ridiculous QE lowering mortgage rates and putting still more money into people’s pockets.
The Fed has never admitted this error.
Real vs Nominal Retail Sales Detail
Real vs Nominal Sales Notes
- Real retail sales peaked in March of 2021 at 233,440. They are now 231,630 That’s a decline of 1,190 or 0.5 percent.
- In March of 2021, nominal sales were 603,581. They are now 773,947. That’s an increase of 170,366 or 28.4 percent.
Over 100 percent of the increase in retail sales since March of 2021 is due to inflation.
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The FED has an internal mandate that prices rise 2% a year, so as to fuel inflation. The FED does not support stable prices.
A’course sales are higher: costs are higher, ergo price figures must ALSO be higher.
May folks are buying to keep ahead a’fore prices escalate further!
I think the 3.1% increase in retail sales for Gas Stations will be considered the canary in the coal mine.
Retail sales can be up as consumers buy less and retailers make less profit ? Lets say consumers bought 10 lawnmowers for $100 each in 2025 totalling $1000 in sales for Retailers. But the following year Consumers only bought 9 of the same model lawnmowers but now pay $120 each which appears as Retailers having increased sales totalling $1080 . But the Retailer sold less of those lawnmowers and could have even less profit if his suppliers and truckers had raised their prices for supplying 9 of those 2026 year lawnmowers. Increasing dollar amounts in sales by itself can create a false image of things getting better when things are often getting worse for everyone selling or buying due to increasing costs on almost everything lately. Government selecting the numbers to make a downer seem like an upper?
OT but I just…I..um…I think y’all should know the admin had its priorities straight early on:
“Changes to the FBI’s hiring policy were discretely initiated on February 28th, 2025, just eight days after Patel was confirmed as its director by the Senate, when the bureau chose to lower the standards it uses when conducting background checks on applicants. Under the new hiring standards, prospective employees would no longer automatically be ruled ineligible for employment if they were found to have engaged in bestiality so long as the act took place before they turned 18 years old.”
– ht: DD Geopolitics
I guess they’re recruiting animals for the animal farm now.
How on earth would they know? Recruiter to a recruit: what was your first sexual experience and how old were you? Recruit: It was with a pig, and I was 14? Recruiter: not a problem.
Arkansas, here we come….
J. Edgar Hoover is gyrating in his grave with an impossibly perplexed look on his mug.
Warsh decision looks good, at least for a day. Better than in the past.
There are about 17 million more people living in the US now than in 2021. Per capital real retail sales would be lower yet.
Official people or does that account for departing illegals?
Yes NYC alone has added back all of the population exodus from during the pandemic. The more they build the more rents rise, since when has $3709 a month been normal for a studio apartment
Some technical comments.
First, this analysis is extremely dependent on what month is chosen as the baseline. Gemini actually disputes the statement “Real retail sales peaked in March of 2021 at 233,440”, replying that “The exact value for March 2021 in the official FRED RRSFS dataset is 227,800.The 233,440 value you are seeing is almost certainly a historical artifact from an older, unrevised data release from late 2021 or 2022.” Gemini thinks the peak real retail sales spiked to 228,405 in April 2021. I won’t get into who is correct on the exact value, but my thinking is that the whole COVID stimulus so warped the data in this time period that it is impossible to know what exact post-COVID baseline to use. Over time though, the warping effect has gone away. So my preference is to use a pre-COVID baseline number and work with the time range of Feb 2020 to August 2026. If we do this, the annualized rate of increase in aggregate real retail sales is 2.7%.
Second, when looking at time spans of more than a couple of years, I think it is neccessary to adjust the data for population size changes, since ultimately each individual person is interested in how much their own individual purchases have increased (in real terms), not how much the entire population’s purchases have increased. Over the time range of Feb 2020 to August 2026, the US population increased by about 4.1%. So we get to a final annualized per capita increase in real retail sales of 2.0% over these past 6.5 years.
Third, historical contextualization is necessary. A similar analytical approach gives annualized per capita increase in real retail sales values of 1.6% for the 2010s and 1.9% for the 1990s. The current 6.5 year period compares well.
In the end, taking a somewhat longer time period and a more historical view, I am less pessimistic about these data.
Great comment, thanks for the analysis.
Of course most of the rise is due to people maxing out credit cards and additional cards, to higher credit limits at an APR % close to 19@% ,like with $3000 a month for a studio apartment, this somehow is the new normal
Oops. Partly my fault. I replaced some worn out lawn care equipment.
I promise to offset this by not buying one of Apple’s new phones. That should even it out.
That doesn’t mean people are buying more! It only means people are paying more for the same (or even lower) amount of goods.
Gas Prices Could Cost Republicans the MidtermsMany voters understand that the president isn’t directly responsible for the price of oil. Except this time, he is.
Gas Prices Could Cost Republicans the Midterms – The Atlantic
Could?
Let’s just see how well they rig the election this time.
Will some of those FBI bestiality people be deployed to polling places?
There will definitely be ICE hambeasts on hand.
the suckers and losers see high gas prices, others, the winners, see massive profits. Easy to right the ship, just move from the wrong side to the right one.
The irony of all of this is that there was a time to board the money train, or in this case the money ship if people were paying attention, especially to Mish’s posts.
That ship has sailed now, people on the profit cruise with ports of call: Wealth, Joy, Purchasing Power, Security and Freedom.
In contrast, suckers and losers boarded the Trumptanic. Ports of call: Depression, Anger, Despair, Insecurity, and Bankruptcy. There’s no getting off for two more years, no early disembarkation, no customer service and absolutely no refunds.
Pay attention on Mishtalk and maybe next time you’ll be on the right ship.
Socialism is gaining in popularity, due to phase of the long term cycle. Currently, the California wealth tax yes vote has a small lead over the no vote, despite the plethora of NO vote warning ads on TV.
the true and only real job of the FED is to keep their owners solvent, and in high cotton. for the very naive, the FED owners are the NYC money center investment and commercial banks. all the rest of their blabbering, including inflation is poppycock and rubbish. gruel handed out from K through state university grad schools. ask mark skousen what happens when you teach the kiddies at columbia business school, the truth. ha ha ha.
or read “creature from jekyll island” for an insightful and intriguing story of the birthing of our 3rd central bank.
Impressive analysis Mish.
This report should force the FedReserve to raise rates at its next meeting since yesterday’s rate hike only reversed course in the direction of inflation. Now the FedReserve needs to accelerate to catch up.
Considering a can of beans is up 10% this week, sales should way above 1.2%.
mix worms with beans
Having the poor eat grass could solve some of the labor shortage in immigrant lawn care.
We could solve poverty, homeless, and hunger by simply eating the poor, homeless, and hungry.
Check my math.
the walmart crowd might be a bit fatty but probably tastes like bacon. ghenghis and kublai khan boiled the enemies in gigantic vats and fed them to their warriors. why waste corpses or feeding prisoners of war. which. were probably not an issue.
as growing teens, we used to eat our blue fish and mackeral raw on board in LI sound and ocean, freshly caught. some tabasco and it was as good as any sashime i’ve ever had.
eat what you kill, preferably raw, was a term i later learned on wall street. ha ha ha