Some analysts have been predicting a collapse in sales for the US
economy. One prominent economist announced in a recent round of TV
interviews that sales generally were in the process of "rolling over."
On that assumption, the economy is in recession, he explained. But a
funny thing happened on the way to the collapse: sales have held up, and
even turned up. Yesterday's November update on wholesale trade figures is the latest data point that contradicts the pessimistic view on the macro trend.
Wholesale trade sales rose a respectable 2.3% in November, the Census Bureau reports. That follows the previously released updates on November retail sales (+ 0.3%) and November manufacturers' sales (+0.4%). The message is clear: sales in November increased across a broad spectrum of the US economy.
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More importantly, the year-over-year trend remains positive through
November for all three data sets. In fact, the pace of annual growth
overall has turned modestly higher vs. recent history. The latest
numbers through November show that the year-over-year percentage
increases range from 3.7% (manufacturing and retail) to 5.6%
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For a clearer look at how the annual rates compare, let's focus on
recent history. Here's how each of the sales indicators stacks up in
terms of annual changes, including an aggregate measure of all three, as
shown by the gray bars. Overall, manufacturing, wholesale and retail
sales rose 4.3% in November vs. a year earlier. That's up from October's
3.2% increase and comfortably above the low growth rates in the summer.
No one will confuse the recent increases as historically strong
comparisons, but the numbers don't equate with an economy that's
Ok, but how does December look? It's still early, but the incoming data for last month so far is encouraging, as I discussed earlier this week.
Yes, the future is surely loaded with surprises. Based on the numbers
in hand, however, the case for arguing that modest growth remains the
path of least resistance continues to look like a reasonable view.