Retail Sales Fall by Record Amount
October retail sales dropped by the largest amount on record, the Commerce Department reported this morning, as worries about the financial crisis caused consumers to sharply scale back purchases large and small.
The department said October sales were $363.7 billion, a 2.8 percent decline from September and a 4.1 percent decline from October 2007. The 2.8 percent decline was more than what analysts expected and surpassed the 2.6 percent decline after the 2001 terrorist attacks.
A steep drop in auto sales led the plunge, as access to credit has severely hampered the entire purchasing chain for the auto industry, from the manufacturing end to car dealerships to the ability of car shoppers to find auto loans at attractive rates.
The department said sales for autos and parts dealers fell 23.4 percent in October compared to a year ago and furniture sales and home furnishing sales fell 13.5 percent.
The auto industry is desperately trying to get more federal aid, and Democratic lawmakers are proposing an additional $25 billion bailout legislation to help the industry.
Congress already approved a $25 billion package of direct loans but automakers have been unable to receive any of the money so far because it is designated for retooling plants to make more fuel-efficient vehicles.
-- Sara Goo
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