Consumers Climb Out of Their Bunkers . . .

From the “It-Aint-That-Bad” file comes the most recent reports of consumer spending.

As we have previously exhorted, the consumer is “not quite dead, yet.” Indeed, the data suggests that after falling into a state of frozen panic during the credit crisis, there are signs of pent up demand being satisfied slowly but surely.

The perma-bears and recessionistas are loathe to admit this, but the data continues to gradually improve. I will be the first to admit that the year over year comparisons are against absurdly low levels, but it is improvements nonetheless. Data reflect a very gradual month-over-month improvement, and show huge gains on a year-over-year level.

It will be some time before we return to the peak levels of 2006-07, when Houses were used more as equity structures than shelter. But that does not mean we won’t see marked improvements over the coming quarters.

Consider these data points:

• Luxury sales rose 22.7% (Mastercard SpendingPulse)
• Furniture sales rose 13.8% and appliance sales rose 6.9%
• Auto sales gained 24% from year ago levels (AutoTalk)
• March was the 7th consecutive month of increasing retail sales growth
• Cargo volume at major ports imports is trending towards an 8% increase in April
• Commerce Department’s personal consumption expenditures was $34.7 billion in February, an increase of 0.3% over January — the fifth monthly gain in a row.
• Gasoline demand continues to rise — +1.2% — before the summer driving season.

Two last things to consider:

Ignore the plus 10% nonsense from the International Council of Shopping Centers — it has more to do with the Easter calendar shift than actual change in consumer behavior.

Second, DJMT calls “shenanigans” on the NYT happy talk. While I don’t completely agree, I will concede that Paul Vigna  raises a valid point as to both the NYT and the WSJ. As we noted yesterday, everybody talks their book.

While the universe is not nearly as rosy as the front page of the Times (Jobs and now Retail) proclaims, it is also not as dire as the usual survivalists (MREs, Ammo, and bottled water) have claimed.

A slow, painful recovery still awaits us . . .


Upbeat Signs Revive Consumers’ Mood for Spending
NYT, April 6, 2010

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