Retail sales had another poor month in February. It’s very recession looking.
The Non-Rebound Rebound
Please consider US Stocks Stable After Retail Sales Rebound
U.S. retail sales rebounded in February, suggesting that the economy continued to grow in the first quarter, though at a moderate pace as tariffs on imports and mass firings of federal government workers weigh on sentiment.
This is not a rebound. The Census Department revised January from -0.9 percent to -1.2 percent.
And from that revision of -0.3 percentage points, sales only rose 0.2 percent vs the Bloomberg consensus estimate of 0.7 percent.
And even if we ignore the negative revision, real retail sales, adjusted for inflation were flat.
Advance Retail Sales
The Advance Retail Sales report for February shows further signs of consumer weakness.
Advance Estimates of U.S. Retail and Food Services Advance estimates of U.S. retail and food services sales for February 2025, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $722.7 billion, up 0.2 percent (±0.5 percent) from the previous month, and up 3.1 percent (±0.5 percent) from February 2024.
The key phrase is in italics. These are nominal sales. It’s real (inflation-adjusted) sales that feed GDP.
Nominal Advance Retail Sales Month-Over-Month
Nominal Month-Over-Month Details
- Total: +0.2 Percent
- Ex Motor Vehicles and Gas +0.5 Percent
- Ex Motor Vehicles: +0.3 Percent
- Food Stores +0.4 Percent
- Food Service: -1.5 Percent
- Nonstore: +2.4 Percent
- Motor Vehicles: -0.4 Percent
- Gas Stations: -1.0 Percent
To arrive at real sales, subtract 0.2 percentage points from the above numbers because the CPI rose 0.2 percent.
Real vs Nominal Advance Retail Sales Percent Change
Real total retail sales were flat for the month. Factoring in negative revisions, real sales fell 0.3 percent.
Advance Retail Sales Millions of Dollars Seasonally Adjusted
That chart is a mirage of inflation.
Real vs Nominal Advance Retail Sales
Adjusted for inflation, retail sales are amusing.
Sales are below the free money pandemic spikes that fueled inflation ever since.
Real Retail Sales Detail Millions of Dollars
Do these charts represent a strong consumer or strong inflation?
But hey, that’s OK because of the amazing success story of tariffs. For example, please consider The Amazing “Success” of Trump’s 2018 Aluminum Tariffs in One Picture
I hope you can take a bit of headline sarcasm because the true story follows.
Oh wait, I forgot that was sarcastic.
Trump and Secretary of Treasury Bessent Discuss the “Detox Recession”
On March 10, I noted Trump and Secretary of Treasury Bessent Discuss the “Detox Recession”
Don’t worry, it’s just a little more pain and inflation disturbance before tariff greatness begins.
Does that make you feel better?
Lutnick Says Tariffs Can Eliminate the IRS and Balance the Budget
On March 12, I commented Lutnick Says Tariffs Can Eliminate the IRS and Balance the Budget
Lutnick: “We’re going to make the External Revenue Service replace the Internal Revenue Service.”
I ran the math on that ludicrous idea. Team Trump only needs to bring in $7 trillion in tariffs on $3.3 trillion in total imports.
Then we need to faithfully collect 200 percent tariffs on everything with of no trade frictions, no retaliations, and full compliance.
Wait a second. Aren’t tariffs a tax on consumers. That’s what everyone with an ounce of common sense thinks.
However, Trump says they will make consumers strong again. Now, who are you going to believe?
Trump Wants a Weak Dollar But Needs a Strong One
On March 16, I commented Trump Wants a Weak Dollar But Needs a Strong One
Trump wants the Fed to cut interest rates to weaken the dollar and boost exports. But that’s not what helped him get elected.
Trumperland Miracles
Trump simultaneously promotes a strong and weak dollar, and proposes we collect huge tariffs while reducing imports.
We will allegedly balance the budget by running huge deficits while having a Detox recession and not having recession.
Finally, in Trumperland, contradictions have no meaning, so a dollar that buys less results in lower inflation.
Got it?
In my view there never was going to be a rebound right away. That was just bluster of what will be, with hopes for it to be faster than anticipated. Sort of setting the stage for further indicators. Problem is, things were far worse than they possibly could have known or actually thought it was. Partly because it was a mirage that was very nicely supported by the MSM and most Talking Heads.
Now the indicators are not only not showing up yet, or even close, as Trillions also need to be rescued, found, unwound, clawed back Etc. Financially it was a 4 Year Free For All! Unfortunately not so much for the American People. Hell they’re still battling for “Venezuelan Murderous Gangs” to be allowed to stay in America. I think they are also going to Court to recoup FEMA Funds, meant for Americans in emergency need of help, to stay in “Plush Hotels” in NYC. It’s insane…
This is the Recession that has always been here, for quite a few years now. Not spoken about, Not realized, Not factored into anything. Just growing with Inflation, Job Losses, Illegals taking jobs and lowering our pay, Etc.
It’s called Reality!!!
Food Service: -1.5 Percent > Not going out for food and drinks as much.
Gas Stations: -1.0 Percent > Not any money for Joy Riding.
Factoring (perfect word) in negative (nearly always) revisions (you don’t say), real sales fell (No Way) 0.3 percent. Who could have seen this coming like a freight train?
They have some work to do, and rather quickly, or falling behind further is a distinct possibility. Now we understand the “Rush”
Lies, damned lies and wall street/government “sadistics.”
Dubya should cheerlead to “BUY BUY BUY! “ in front of the ruins of an old K-Mart.
He belongs in an exhibit with stuffed gorilla in the Lincoln Park Zoo.
TrumpCo is in the business of Bull-Shiza-ing us most of the time. You have to be a completely naive person to believe ANY politician’s words.
Their job duties are to LIE-CHEAT-STEAL.
I do not vote for liars.
So you don’t vote
Libertarians have been on the ballot. The American people should give them a chance to prove if they are telling the truth or lying when they say that they will work for a balanced budget, meaning not voting for any deficit spending. I would like if someone compiled the voting records of the libertarians who have held state office, to see if theyve kept their word or not. Amash served in US Congress supposedly for around a year or two as libertarian, and he did vore against the cares act so that is good.
Credit Card usage increases in 2025, along with the 2025 Retail Sales, will go hand in hand.
Once credit dries up due to the extended consumer, then 2025 real Retail Sales will go negative, possibly for many months in a row.
Watch the Credit Card/Auto Defaults closely to see the health of the US consumer.
Skip the summer vacation, and eat at home.
DOGE & Congress will shrink fit the government to tariff size.
DOGE can try. Congress may go along with a very small fraction of what DOGE recommends. Shrinking the government to tariff size isn’t going to happen. Total pipe dream.
I prefer copper, type K
https://x.com/tedcruz/status/1901646958806049204
Easy peasy.
“Sales are below the free money pandemic spikes that fueled inflation ever since.”
Retailers figured out that the current generation of consumers offer zero push-back on pricing (Food store +4.8% annualized, non-store up 28.8% annualized!). The K-shaped “recovery” consists of price indiscriminate buyers, specifically the large pool of “free money” lotto winners. Why on earth would nominal price inflation subside? Until the $11 Trillion resting peacefully in money-market and bank accounts is substantially spent down, we will get more outsized nominal price increases. This is likely why Treasury Secretary Bessent recently said that a fall in stocks is not a problem. (In fact, it is necessary for a healthy economy.)
Not sure what there is in your post to merit a downvote. The only way to kill inflation is to take the FFR up to 2% or more above the inflation rate. They never did that. And a fall in stocks totally needs to happen. DJIA at 41,800 (or 44,000+ like it was a few weeks ago) is ridiculous.
People now think that an annualized 6% inflation rate (Ex Motor Vehicles and Gas) is “normal”. Meanwhile, Treasury Bills pay less that 4.5% interest, making savers the biggest “suckers” around.
As far as the downvote, people in America only care about themselves now, not the society they live in. They don’t care if people under 40 have to live in a van and eat rice and beans for the rest of their life, being only able to get part-time and/or minimum wage jobs, as housing prices increase 5%+/yr.
I agree the inflation and deficit spending is not good for our country but I think savers are and will be rewarded. Eventually the bubbles will pop and they can get some good deals, and more to their credit they can use some of their savings to help the poor. Beans and rice might get a littie mundane if eaten a lot but they are very nourishing and affordable, a gift from God it seems to me.
Since Jan 2021 motor vehicle sale (green) are flat. In high RE tax area those whose H1B visa expired might not find a buyer even with 2.5% mortgage, or a big discount.
eggs price down whoopdeedo oil goes up https://www.cnbc.com/2025/03/17/oil-rises-as-trump-says-iran-will-be-held-responsible-for-any-future-houthi-attacks.html
Poor baby. Don’t let that TDS make your blood pressure rise. I advise you to drink heavily.
Oil is at $67 a barrel. That is not a high price.
Anything above $30 is high in my world.
You live in that Bizzarro World where Superman is a bad guy
Mobil Oil and Phillips Petroleum were quite the buys in 1986. PE and dividends irresistible.
I’ve been paying under $3 for gas now for a bit…
Nope
Sheesh, also, if you look at a graph of oil prices over the last six months, the price of oil is not up.
Government reports are always a rear-view-mirror. I suspect that sales have fallen off a cliff in the past few weeks. United Airlines, etc. have seen advanced bookings collapse. When the world “layoff” is in the headlines everyday, it starts to sink in – not only government layoffs but in the private sector. I don’t see how we can avoid a recession at this point, but recessions are sometimes necessary to bring down inflation, and are just part of the financial cycle.
Yeah, I was thinking the same thing too. My brother drives Uber on weekends, and he told me he’s seeing fewer and fewer people. We will get some bad news in April.
The FED is the cause of the business cycle. And they are trying to set policy while looking in the rearview mirror. Nothing good will come of this.
If you rode the elevators in The Willis Tower you’d never fly United.
DOGE’s Cuts at the USDA Could Cause US Grocery Prices to Rise and Invasive Species to Spread
Thousands of US Department of Agriculture employees, including food inspectors and disease-sniffing-dog trainers, remain out of work, leaving food to rot in ports and pests to proliferate. https://www.wired.com/story/usda-food-supply-chains/?utm_content=buffera537c&utm_medium=social&utm_source=bluesky&utm_campaign=aud-dev
also, the sky is falling
He’s totally right, though. Without government, we’d be eating tainted meat, the food supply would be threatened by pests, and invasive plants and animals would threaten our native flora and fauna. Fixing these problems *IS* rocket science that can’t be left to individual people who actually have skin in the game. No, we need a government hack with no skin in the game to help the rubes not be stupid
sarc
Good report. And egg prices are down.
It’s the Bidencession. Once we wring out the last of Bidenflation we can get lower rates and be off to the races.
Hahahaha. OK.
$5000 DOGE “dividend” checks would come in handy right about now.
Yeah, let’s make America choke on leech-bucks again!
It’d be a repeat of what happened with COVID relief/stimulus checks.
Trump sent out the COVID checks. Now he’s considering the DOGE checks. Why do you think he won’t go through with it now?
He’s already planning higher deficits with the tax cut extensions. What’s the difference of a few more trillion added with DOGE checks?
The 2 trillion Cares act debt signed by Trump and passed by the Republicans and Democrats, plus the equally wrongly named Biden american rescue plan stimulus will be an added burden on us when times are tight and more debt from Trump would just make things worse. These politicians who vote for this unnecessary spending are bringing shame on the USA.