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2.7%  Q1 GDP    4.57%  avg. 30-year mortgage     9.5%  Unemployment

Retail Sales Slump in September

Retail sales in September suffered their largest decline since December 2008, thanks to the Cash for Clunkers hangover.

Retail sales dropped 1.5 percent in September compared with August, the Commerce Department said this morning.

However, if you remove vehicle sales from the numbers, retail sales actually went up 0.5 percent last month. If you remove vehicle sales and gasoline purchases, sales went up 0.4 percent.

Retail sales were helped by back-to-school shopping during the Labor Day weekend, which fell in September this year.

Now, everyone is holding their collective breath for the holiday season. Last month, retailers said their expected a 1 percent rise in holiday retail spending this year compared with last year.

In other news out this morning, September import prices rose 0.1 percent and export prices dropped 0.3 percent, thanks to the declining strength of the dollar: Exports cost more for us to buy and our products are cheaper to buy abroad as the value of the dollar goes down.

Year-over-year, import prices were down 12 percent in September and export prices were down 5.6 percent.

The dollar is near a 14-month low, as foreign countries worry about its devaluation because the Fed printed so many new dollars during the bank meltdown last year to prevent a liquidity crisis.

We'll keep an eye on stocks when the markets open to see how they are affected by the retail sales numbers.

-- Frank Ahrens
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By Frank Ahrens  |  October 14, 2009; 9:07 AM ET
Categories:  The Ticker  | Tags: export prices, import prices, retail sales  
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Comments

The decline was inevitable after the Cash for Clunkers program had pushed auto sales way up, and in turn retail sales way up, for the month of August. Like pretty much all the stimulus programs, Cash for Clunkers was merely a band-aid that people knew would have little effect. All it did was push anyone on the verge of buying a car, over the edge. So basically you got all of July, August, and September’s auto sales contracted into the month of August. People that planned to buy a car in July, waited until August. People who planned for August, of course still purchased. While the people who might have waited until September, decide to push it up a bit. I don’t think it really had any real effect besides changing people’s timing.

When compared with last year, the retail sales numbers certainly look much better. Last year saw sales start to slow during the summer and then really took a major nosedive in October, November, and December. This year we appear to be on a slight upswing heading into these make or break months. Right now we just have to hope and pray that things keep heading in the right direction. A good 4th quarter of retail sales would be a major sign that maybe this thing is really over. So keep your fingers crossed people and do your part to make this a great Christmas season!

Check out my blog on the September retail sales numbers at..... http://www.thedebtgazette.com/2009/10/retail-sales-not-as-bad-as-expected/

Posted by: FrankFitton | October 14, 2009 12:04 PM | Report abuse

If only the management at department stores could see that consumers can't buy what isn't there. I don't go shopping anymore because THERE'S NOTHING TO BUY!!! Duh!

Posted by: pkbishop | October 14, 2009 6:37 PM | Report abuse

But-But-But...

The DJIA is over 10,000!!!!!????

10% of working Americans are un-employed while 20 MILLION Job Stealing Wage Destroying Invaders are getting Amnesty????!!!!

Scottie Dm'IT!!!!

BEAM ME UP!!!!

There is simply NO Intelligent Life Down Here!

Posted by: SAINT---The | October 14, 2009 8:08 PM | Report abuse

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