Jack Dunn - Reclaiming Common Sense

The Retail Renaissance is Real


Retail sales this September should drop, non-seasonally adjusted, from August to September, now that everyone is "back to school." The headline data is the seasonally adjusted data. All sectors should see seasonally adjusted (SA) retail sales growth except the Sporting Goods, Hobby, and Book sector and the Electronics and Appliances Sector. The data to watch is the September to September growth, the current year growth for January through September, and the rolling year growth, from October 2017 through September 2018.


Month to Month growth should fall non-seasonally adjusted and grow seasonally Adjusted. The data is "ugly" non-seasonally adjusted. The biggest losses, NSA, month to month. The largest,percentage, drops should be in sporting goods and hobby and the clothing sector. It is possible that we could see a slight gain in gasoline sales.


Same Month Growth has been over 5% six out of eight months this year. Same month growth has been up by 6% or more three times this year. We are heading into the holiday season, and we are coming off record high levels of July, August, and September Full-time Job levels, non-seasonally adjusted. Wage spike this past month. Expect September to September growth in all sectors, non-seasonally adjusted (NSA)or SA. The largest gains should be in Non-store Retail (7-10%,) Motor Vehicle and Parts (6-10%,) Building Material and Garden Supplies (4-8%,) and General Merchandise Sales (2-6%.)


Rolling Year growth should break through 5.7% and possibly 6.0%, non-seasonally adjusted. This is what has happened. If the rolling year growth rate is slower than the current year growth rate then the economy is growing. If the came month growth rate is greater than the current year growth rate then the economy is expanding substantially.


The Current Year Growth rate may hit 5.8% to 6.0%. We have seen that value at, or near 5% since January. It has climbed during May, June, July, and August. We are on track to have our first $6 trillion retail sales year, and are closing in on $6.1T to $6.2T


The Seasonally adjusted growth is in sync with the non-seasonally adjusted growth rate. The headline data, SA, had been falling since June 2015, through September 2017, on a quarterly basis. This impacts the Gross Domestic Product (GDP.) The trends are present. Speculation on the seasonal factors used to convert the non-seasonally adjusted data that is recorded and used to create the SA data that is reported is difficult.


Expect good news next week. The Sporting Goods (SGHBM) and Electronics/Appliances (EAS) sectors have been lagging during this recovery and expansion. We saw some spark of hope in EAS earlier this year. It may continue this month. Watch the current year, January to September growth, NSA. A 5.8% rate for total growth is possible. Behold the Retail Renaissance.


It's the Economy.