Retail Sales Report Not As Ebullient As Reported

August retail sales were reported to be .4% above the July metric. However, July's number was revised down, making whatever increase in August there was from back-to-school buying appear to be more significant arithmetically in the headline than the overall nominal increase month to month.

In addition, as Bloomberg reports, 17 States engaged in "no sales tax holidays" during August.  As we have seen with Government subsidized sales programs in autos and housing, all this does is "pull" future sales into the present, creating large drops in sales in subsequent months.

As per one of my earlier posts, a recent survey of the population indicates that over 2/3's of the country sees worse economic conditions going forward and over 75% plan to cut back on holiday spending. Programs like "sales tax holidays" will likely exacerbate this future reduction in spending.