The Census Department shows huge across-the-board declines in multiple categories, down 0.9 percent overall.
The U.S. Census Bureau announced advance estimates of U.S. retail and food services sales for January 2025.
Advance estimates of U.S. retail and food services sales for January 2025, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $723.9 billion, down 0.9 percent (±0.5 percent) from the previous month, and up 4.2 percent (±0.5 percent) from January 2024. Total sales for the November 2024 through January 2025 period were up 4.2 percent (±0.5 percent) from the same period a year ago. The November 2024 to December 2024 percent change was revised from up 0.4 percent (±0.5 percent) to up 0.7 percent (±0.3 percent).
The key phrase above is “adjusted for seasonal variation and holiday and trading-day differences, but not for price changes.”
The inflation adjusted declines were enormous.
One positive aspect was the upward revision for December, but that will accrue to 2024 Q4, subtracting from 2025 Q1.
Real Advance Retail Sales Percent Change Month-Over-Month
Real means adjusted for inflation using the CPI Index 1982-1984=100 as the deflator.
Nominal Month-Over-Month Declines
- Total: -0.9 percent
- Excluding Motor Vehicles and Parts: -0.4 percent
- Excluding Motor Vehicles and Parts, and Gasoline: -0.5 percent
- Motor Vehicles: -2.8 percent
- Food Stores: -0.1 percent
- Nonstore Sales (e.g. Amazon): -1.9 percent
To arrive at real sales, subtract the month-over-month increase in the CPI of 0.5 percent. Rounding errors account for any differences.
Declines in motor vehicle sales account for over half of the decline. But even ignoring motor vehicles, sales were very weak with nonstore sales down 1.9 percent.
Real vs Nominal Advance Retail Sales
A Mirage of Inflation
The chart of Real vs Nominal Advance Retail Sales shows notion of “strong consumer spending” is nothing more than a mirage of inflation.
Related Posts
February 13, 2025: Producer Price Index (PPI) Soars Led by a Surge of Positive Revisions
The PPI was hotter than expected, and that was on top of huge positive revisions.
CPI Much Hotter than Expected
On February 12, I noted CPI Much Hotter than Expected, Core CPI Hotter than Expected
CPI Hotter than Expected
- CPI: Bloomberg Consensus 0.3% v Actual 0.5%
- Core CPI Excluding Food and Energy: Bloomberg Consensus 0.3% v Actual 0.4%
- CPI Year-Over-Year: Bloomberg Consensus 2.9% v Actual 3.1%
- Core CPI Year-Over-Year: Bloomberg Consensus 3.1% v Actual 3.3%
The Fed will not be cutting rates anytime soon at this pace. Of course, tariffs and a huge global trade war could crash the economy.
Fortunately, Trump Fails to Pull the Trigger on Reciprocal Tariffs, Will Study the Issue
To answer the lead question “Did the Consumer Finally Throw in the Towel?” I don’t know, nor does anyone else.
Also, we do not know what if anything will happen with the budget. But Trump is angling for something very inflationary that will add to the deficit.
I will have some detailed analysis of the budget shortly.
McDonald’s burger sales are down, and I doubt it’s a sudden netzero health binge.
Maybe RFK Jr. is already having an impact on the publics health & food choices
Real retail sales are flat to down with the Federal govt running a 2.1 trillion deficit! 7.3% of GDP! Imagine is DOGE does manage to cut spending.
Would not be surprised at all, to see a large drop in the Federal Deficit number, within 1 Month from today.
They need to show progress, they mentioned large numbers being clawed back, and other money not spent, but frozen still in litigation. Much of this when all set and released back to our Government. Some of which I would assume, can be placed right onto the deficit. We shall see…
Real retail sales peaked March 2023 (at which time the S&P was 4100). Real retail sales are flat to down since, but the S&P is now 6100. Explain that.
People are learning how to save money. Ride a bicycle or motor bike. Use magicjack instead of a cell phone. Cook dry beans, barley, buckwheat, rye you purchase in bulk. Eat pasta with homemade sauce. Spread peanut butter with homemade wild fruit jam. Learn to cut a chicken. It’s not that hard to grow a chicken. You can raise carp in a tub of water with table scraps. Quality clothes never go out of style. Garden, hunt, and fish. Exercise is free. Changing auto oil and basic mechanical repairs are easy. You don’t need a big hoss truk. Try preserving kimchi vegetables on sale. Home brew coffee and tea cost less than a double latte. Children are a luxury. Warm blankets and sweaters save on heating bills. Heat with a Franklin stove or army surplus tent stove. Homemade laundry detergent costs $0.25/gallon. Take a local camping trip vacation. Bake your own cookies. Learn to mend clothes and darn socks. Get an MIT education on line for free. Vegans don’t get heart disease, diabetes, arthritis, cancer….
Excellent Post!
Which means they’ve lowered their standard of living to match their cost of living. Welcome to the new reality where even President Musk can’t help you.
You have a very warped view…
– save money
– Ride a bicycle
– Use magicjack alternative
– Cook dry beans, barley…
– Eat pasta with Homemade sauce
– Spread peanut butter with homemade wild fruit jam
– Learn to cut a chicken
– Exercise
– Home brew coffee and tea
ETC.
All great ideas and most should be done always anyway IMO.
Excellent, I particularly liked the part that children are a luxury.
Thanks Mel. I see we both read the original comment, not the published & moderated one. Before the sentence was moderated, it actually read “You can raise carping kids in a tub of water with table scraps.” A real breakthrough, I figured, for reducing kid-raising costs. But the moderator changed the meaning.
CREDIT CARDS MAXED, HOUSING LINES, ONLY IF THEY HAVE EQUITY! INTEREST RATES KILLING THEM TOO! BANKRUPTCIES GOING UP RAPIDLY! PERFECT STORM, WAGES FLAT! COLD WEATHER UTILITY BILLS EATING UP FUNDS TOO! Perfect Storm!
Or is it?
C/C’s should be a majority of younger folks. Older folks should have known better.
Heloc’s are strictly controlled, so they are not like a C/C is the free spending, forever it seems, until it’s not.
Wages are always flat, unless it’s good times, which it’s not, or BS going on, which is what’s kept us afloat until now.
Unless your new to a very different climate, heat/cold, and clothing, should not be an issue.
“Perfect Storm” coming, is that “It’s ALL being addressed” Woo-Hoo!
Back at you
!
!
!
!
The bills have come due.
Stagflation is the Feds/Federal governments only solution.
30 years of blame to go around.
No way out.
“The Census Department shows huge across-the-board declines in multiple categories, down 0.9 percent overall.”
Just wait until DOGE audits the Census Department. What will fix everything.
Does it seem coincidental that suddenly the ECON Numbers are down — JUST after Trump is in. HMMMM?
Expect them to get far worse too.
They have admittedly said so already…
Trump’s in control now. If he doesn’t like the numbers, he will fire everyone and make up whatever numbers he wants. Just like he always does. Though there are always numbers from some independent sources he can’t do much about.
Just like you do… making up everything in your retarded posts.
The hatred is strong in PapaDave.
Numbers mean absolutely nothing, made up or not. It’s ALL about the Spending of those Numbers, and How much of those Numbers go Where?
That’s the issue at hand now, and Trump not only doesn’t have much of a hand (DOGE) in that, he wants it ALL exposed, by His Team!
Gone are the days of hide and go seek, and welcome the days of Transparency my Friend!!!
On the plus side, January deficit was only 840 billion, so we’re only on track for a 9.6 trillion dollar deficit this year.
MAGA!
Debt to the Penny calls BS. National debt only up $74B from 12/31 to 1/31.
And reminds that Biden was Pres thru 1/20.
Fortunately, my minions can print more of that for the indentured serfs in “our democracy ™” to pay back without ever being able to own anything or have their votes count for anything in my global WEF wokeocracy.
Well we have had a massive reduction in spending, albeit illegal in nature in many ways, it still counts in the overall numbers.
We have also had a massive reduction in future spending, either pulled since the “Great Uncover of 2025” or more likely pulled as soon as they were aware it was going to be (leaked).
Add in the much awaited (Announcement) Recession steaming down upon us, but blocked by all the Chaos (purposefully created) and Drama being hoisted upon us by the MSM & Delusional Dems…
On track for a 9.7 trillion deficit this year! MAGA!
Gov Josh Shapiro PA sued the gov for money. Sucking money from the gov was over when Kamala/Biden’s quasi unity gov, which controlled almost every aspect of our lives, lost ==> money no longer pour in to the states. Trump/Vance federal gov will transfer power to the states. When Biden’s money evaporate the music will stop. The states will have take full responsibility of their own finance and behave like adults.
Trump wants to eliminate the debt limit, but will settle for a $4 trillion increase for now. Till he bumps into it again.
You must have next week’s lottery numbers as well…
https://michiganindependent.com/politics/donald-trump-federal-debt-ceiling-eliminate/
https://apnews.com/article/house-republicans-budget-blueprint-trump-tax-cuts-ff2bddf31f4e7cb0928139072392a091
I am not very worried about one monthly retail sales number. Let me know the long term retail sales trend along with other long term trends.
Meanwhile, I am impatiently waiting for Trump to actually “do something” significant with tariffs. Talking tough and threatening, without following through, is counter productive. It gives our trading partners time to find alternatives wherever possible, and will only hurt American businesses, who also face this never-ending dance of uncertainty. Businesses hate uncertainty and stop investing. The longer this tariff “talk” goes on, the weaker the US economy will become.
Settling with Canada, Mexico, Putin, Modi and S. Korea is good enough. China and Europe are big bones in the throat.
Lol! We haven’t settled f*ck all. So far it’s all talk. Let me know when something significant happens.
Ah, the mask has slipped – you’re an English troll, not an American troll.
Lol! Believe whatever you want.
One guy here thinks I am also MPO, Realist, Jeff Green and a half dozen others.
I don’t care. But it is funny.
In reality, I am a very wealthy 12 year old girl from Lithuania having fun with Americans.
See my comment below (with long term chart link) and tell me how you feel about the long term trend?
How much of this is down to Zelensky’s wife?
Though I read somewhere that the Repubs now expect to borrow $4 TRILLION? I knew Trump wanted at least $2 trillion but now someone is leaking out $4?
You have to wonder why…with tariffs paying for everything and bringing in trillions of dollars for the new golden age. It’s at $36.5 now. So $45 trillion in debt by the time Trump leaves office?
https://www.usdebtclock.org/
Got an exit strategy?
“tariffs and a huge global trade war could crash the economy.” So could the colossal debt that so many Americans have amassed. I think the crash is getting a foothold. Several customers told me their January ’25 vs January ’24 sales have been halved.
re: “Did the Consumer Finally Throw in the Towel?”
Economic prognostications within a year were once infallible. Powell changed that. He eliminated required reserves. I.e., monetarism has never been tried.
Today, you can still monitor short-term money flows, the proxy for R-gDp. We will have no recession in 2025 without a drop in velocity.
Before Powell, “economic prognostications within a year were once infallible”?
What a ton of crap! Economists and market makers/specialists make the best predictions they can, but they have never been infallible. And that has ZERO to do with Powell. Go back and pull another quote from the 1950s to prove your assertion. Sheesh
Swifty McVay: u got balls? we can see how large, when the music stop.
Eminem: Man, I hate this crap. When we confuse hip-hop with real life the music stop.
TNX is plunging. If that cont JP will cut rates. It might enter the cloud red flatbed and osc. JPM and Citi made a 52W high.
Can you still get Cannon towels made here?
Retail sales down but inflation up? What the heck is Trump and the GOP doing to this economy? It’s 100% Trump’s economy now. We need those tariffs to kick in to take us to the golden age now!
The economy works with lags. Biden is responsible for the uptick in inflation in 2025, culminating in Sept.
Do you realize people who post and read this Blog are sophisticated about economics?
If you want to maintain some credibility at least make an attempt at Truth.
No they are not.
agree !
The evidence says otherwise. I think you should have included “some of the” but then your second sentence added to the evidence. Good luck finding “Truth” – regardless of your level of sophistication.
U.S. Census Bureau? Do they count well? It may depend on who you are…
”Republican efforts to exclude people in the U.S. illegally from numbers used to divvy up congressional seats among states have begun anew…”
Although…
”The Fourteenth Amendment says that ‘the whole number of persons in each state” should be counted for the numbers used for apportionment, the process of allocating congressional seats and Electoral College votes among the states based on population.”
“Trump and Republicans Aim to Update Census for Political Advantage”
https://time.com/7209054/trump-republicans-2030-census-politics-citizenship/
Non stores online sale is dying. Return for credit is rising. For some people it’s a hobby. They do it to punish the online retailers, especially the small ones. UPS benefits from them. Motor vehicle buyers preempted tariffs in Nov. Nov was a month to ignore. In Dec they died. In Jan they plunged. Inventory is piling in dealer’s lots. Dec was a thud in every category.
Update: Real per capita retail sales rose 25% from 1992-2000, then went nearly flat for 8 years before plunging 15% in 2008. They did not recover to the 2005-2007 peak until the COVID stims. The COVID high has worn off and real per capita sales are back to just slightly above the 2005-2007 peak. In short, the “progress” from 2005 to 2025 was 2-4% TOTAL, or just 0.1-0.2% per year.
Chart of real per capital retail sales in fixed 1992 dollars: https://fred.stlouisfed.org/graph/?g=1DHZp
You reference this economic ‘analysis’ again further up.
I’m surprised because it’s not correct. And you know that, as Wolf completely and unequivocally schooled you on why your analysis is BS, using CPI as just one example
This is obviously Biden’s fault.
Chart the data as Real Per Capita sales and it’s not just stagflation, but a genuine downtrend… lifestyle recession.
This is probably still true even using a better deflator than CPI-U.
I’m personally only buying sexy underwear and bobble head dolls for the foreseable future, until the trade sanctions and tariffs get worked out and I run out of whiskey and cigarettes.
just one consumer, but I feel I’m more average than most average consumers are average, because I think like the average consumer thinks about the average consumer, on an average basis…
I’m disappointed – your comment started out well but ended just average.
on average, I think your observation hit the target.. Remember the difference between ordinary and extraordinary is just that little extra…
Would be interesting if there were reliable stats on how much of the population is just plain spent-up (less than $1000 left) and borrowed-up and those hard-ups’ share of national consumer demand. I know, there’d be so many +- percents it’d still be guesswork. We’ll only know the bell got rung a year after the fact, when the markets have told us. Very frustrating trying to trade an anticipated sh1tshow.
The Bankrate Emergency Savings Report says 41% of those surveyed said they would use savings to pay a $1,000 emergency expense. The rest apparently need to borrow.
December is the biggest month for retail sales. January the worst. So it makes sense for sales to fall in January vs December. The January to January comparison is a much better measure and it showed an increase of 4.2 percent.
They paid more and bought less.
Inflation was less than 4.2% YoY, so you are incorrect
???
So even after taking inflation into account, retail sales were positive year on year.
Month on month measures are meaningless due to seasonality. That’s why the 10-k show sales versus the same period a year ago.
That’s right; thanks for correcting this clickbait.
December 2024 numbers were a record. So Mish’s charts and numbers would look drastically different if he calculated them Y-o-Y. Plus it would be easier for everyone to calculate mentally the ‘real’ value as inflation numbers are usually considered Y-o-Y too
This begs the question: what has everybody been drinking?
The fact that these news come as a ‘surprise’ is an indication of how myopic most economists are. As in: what were you expecting?
Dumb monetary policy begets dumb economic outcomes.
No wonder the Fed is always missing the point.
What?
As a non-surprised fortune teller, why don’t you tell us what retail sales percentage growth will be for February (when the numbers come out in March)? And CPI? and jobs growth?
Then we’ll check back in with you in a month to see how smart or “dumb” you actually are – since everyone else is myopic. Thanks
I don’t know what they’re drinking, but its probably not Bud Light.
myself and many persons I know (its NOT political) are in the buy only the necessities mode meanwhile A Drone Strike Has Hit Chornobyl and Set Fire to the Shield that Keeps Radiation at BayKyiv says that Russia attacked the nuclear power plant with a drone carrying a warhead.
how close do you live to Chernobyl? I worry more about the morons on their cellphones driving on the freeways with me, than I do a radiation leak half a world away.
Complete lack of empathy for the millions that would die if that sarcophagus breaks open…. that’s the way!
King Tut’s?
My woke scarcophagus already broke open, and I already unleashed my pandemic hoax and moneylaundering proxy wars, controlled media and rigged elections, embezzling billions for my socialist(tm) billionaire elite sex offender cult.
224 people were just laid off at a local chemical plant, and the Joann fabric store is closing too.
suggest you read daily job cuts dot com. google it or just put the words together and substitute the “.” for dot.
I’ve been perusing it since the crash of 08….
Same here. I’ve been following for a long time. It’s a great website. In addition to jobs/layoffs/closings it has headline news articles that take you to the source of the article.
Lol 224? I think 70k+ government workers lost their job this week. Way more coming later.
Few more shoes to drop:
-retail sale collapse (checked)
-increased credit card default (checked)
-increased car loan payments defaults ( in process)
-increased reals estate mortgage default ( not yet)
Blaming it all on Trump….Priceless!
L.A. wildfires and cold weather in January was cited as the possible reason.
February’s report should be a better read on consumer spending going forward.
Pay attention- it is always blamed on the weather. It’s always too ________ if there is a miss.
I “pay attention” to those lovely stock & treasury bond charts which I have traded for the past 30+ years. 🙂
The bottom 50% threw in the towel a long time ago and are basically surviving on tree bark. The next 20% are presently throwing in the towel and for the first time are looking at tree bark in a new way.
The top 30% are still spending like there’s no tomorrow. They look at tree bark and they see mulch, not food.
Tree bark is nature’s Ozempic. Michelle Obama had no idea how to slim kids down… but I do!
I too have a fascination with wood and kids, like my corrupt Democrats.
MIke, as a guy merely observing local retail haunts there were very quiet days of “shoot a cannon ball across the store and not hit anyone”, especially in pricier mall-type establishments. (Surprised Macy’s still has the doors open) The lower cost stores seemed steady but a lot more of the basics in carts. Perhaps the good December numbers were some January purchases pulled forward…Hmm, which seems to be what “Team America: World Shopper” is all about. Oh, car dealers notoriously quiet, but not sure that isn’t normal.
Illegal Immigrants are saving their money because they don’t know what’s next. This applies to illegal immigrants, too. In addition, Trump stopped new immigrants from coming in.
you seem to have a fixation on illegal immigrants, perhaps widen you sphere of concern. a single data point isn’t a trend, its an event. you cannot reliably extrapolate anything from a single data point.
Who will pick the strawberries? Full disclosure: I don’t buy strawberries.
No Buy 2025 in action, fueled by disgust at what Presidents Trump and Musk are doing to the USA.
The Golden Age begins. You will buy nothing, and love it!
Oh, the guy in the cuck chair that my kid told to shut up? He’s not president of anything but the golf course.
I am the president, and I am the golden age, along with my hordes of corruptocrats and “our democracy ™”, and my wokefascist cult, you are not welcome at my Davos sex parties.
What THEY are doing to the nation?! Have you been asleep the four years?
That’s it! Let the hysteria FLOW through you!
I am hysteria, and I will flow through all humanity as I buy every democracy.
Well something has changed in the last two months. Tesla sales had been pretty good during the last four years. Suddenly they are plunging all over.
https://thedriven.io/2025/02/05/tesla-sales-are-plunging-around-the-world-is-this-just-a-musk-problem/amp/
You are talking about Americans right? The Americans who can only spend more than they make. There is no chance this will last.
I pulled forward my nonstore buys into December, stockpiling electronics and other stuff I will use in ’25. My portfolio is holding up, but my strategy to maintain that is cutting spending, expecting inflation. So, all you more optimistic folks, spend away!