Two Faces of the Economy

The American people are much smarter than our government thinks.

Take today’s economic information. Retail sales were up 1.1% in September. That has caused liberal economists to be gleeful. It is now something they call a “non recessionary indicator.” that’s politispeak for measuring something that isn’t there. Sorry, but nothing from nothing is still nothing.

Anyhow, other data was not so chipper. The Michigan consumer confidence slid from 59.4 to 57.5, worse than the experts’ expectation of 60. In addition, consumer expectations went from 49.4 to 47; the lowest since May 1980.

Zerohedge blog dubs it “schizophrenia.” How can these two conflicting data live in the same world, you might ask?

Americans who are savvy had a few observations. The same thoughts have probably occurred to you.

It could be inflation, write some, since these sales are not inflation adjusted. When the cost of everything is higher, it looks like sales are higher. Store closures, too, could account for it. It would affect same store and new store sales, boosting them.

Others have noticed that the Chinese are buying up many goods, given the weakness of the dollar.

Some commentators say that people are buying now because they are afraid they won’t be able to afford things later. Personally, I am purchasing things that are on sale, particularly meat. Call it hoarding or prudence, but many of us remember the inflationary 70s. Everything went higher, squeezing salaries.

Many people are preferring to buy little luxuries instead of big ones such as liquor. “The poor man’s gold,” says one, adding it is something to barter in bad times. It will go up, too, and has as I noticed at the wine store that the bottle I bought for $5.99 is now $6.50. Liquor, like gold, won’t spoil or go bad.

The media might check into the sales of anti depressants and see if they are up, suggest some.

Another lays the sales/confidence discrepancy to “binge bling buying before filing for bk (bankruptcy).”

Other people feel the government figures are just lies.

There’s probably truth in all of this. More truth than their numbers.

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