U.S. Economy: Retail Sales Unexpectedly Fall for Second Month

May 13 (Bloomberg) --By Courtney Schlisserman

HIGHLIGHTS

Retail sales in the U.S. unexpectedly dropped in April for a second month.

• Retail Drop: The 0.4 percent decrease followed a revised 1.3 percent drop in March that was larger than previously estimated, the Commerce Department reported today.
  
• Carl Riccadonna an Economist at Deutsche Bank Securities: “It looks like consumers are losing momentum heading into the second quarter and that is a very worrisome development, They have very significant headwinds and number one among them is that the labor market is far from turning the corner.”
• US Business Inventories: Commerce Dept. showed inventories at U.S. businesses fell 1 percent in March, a seventh consecutive drop as slumping sales forced companies to pull back. The streak of decreases is the longest since 2001-2002.
• Sales Decline: was led by falling demand at electronics, furniture, clothing and grocery stores.
  
• Prices of goods Imported: into the U.S. climbed 1.6 percent in April, more than three times as much as forecast, a report from the Labor Department also showed. Excluding oil, prices were down 0.4 percent.

COMMENTS

Rising unemployment and falling family wealth is clearly ripping into the fabric of the economy. Issues of note include:

Grocery store sales declined: I Don't think the implication is that people and families are eating out more. Disturbing at the core if the trend continues.

Rising Oil Prices: Isn't it great to know how the free market really works. Business, Governments, and Families are feeling the pressures of a world wide slow down and as Memorial Day Season draws near we experience the free market price of oil begin it's seemingly obligatory rise for the start of the summer.

Finally, to all you Fat Cats left standing. This is your year. The year the market sucks you in. Be careful you aren't standing by a 747 Wallstreet propaganda engine starting up. Why, because there is tremendous amount of toxic debt and poorly structured equity opportunities that in this new environment will not profit you as they may have in the past.

James Monachino