It seems to me that the doom and gloom crowd is increasingly unhinged. I wish I had a nickel for every “death cross” posted on Zero Hedge in the last year. They post negative economic reports like we are about to succumb to the zombie apocalypse. Don’t get me wrong, I like ZH and I get a kick out of their posts, but there’s a line between pessimism and lunacy and they seem to cross it a lot lately. Karl Denninger is following the same path. He posted this the other day.

Ok, now this is a pretty nasty report...

The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for January, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $439.8 billion, a decrease of 0.8 percent (±0.5%) from the previous month, but up 3.3 percent (±0.9%) above January 2014. Total sales for the November 2014 through January 2015 period were up 3.8 percent (±0.7%) from the same period a year ago. The November to December 2014 percent change was unrevised from -0.9 percent (±0.3%).

Yuck.

What’s worse is the unadjusted numbers.  Keep in mind that there’s this holiday called Christmas in December, but….

Retail, total, was down about 21% unadjusted.  But what’s worse is the lie in the above caption — previous-year comparisons.  The unadjusted January figures were up only 2.85% from January 2014, and if you exclude cars it was only up 1.41%.  Incidentally, ex-autos sales were down 24% sequentially.

You don’t need a seasonal adjustment for the same month in different years!

There was one bright light — gasoline, which was down big (24%).  But the claim that this drop in gas price would translate inexorably to other purchases appears to be flat-out wrong.  Instead, consumers are paying down debt and reducing their leverage — except on cars.

One final interesting point — non-store retailers were only up 2.57% from last January.  It appears that the “internet shopping craze” has finished its large growth numbers; this has an interesting set of implications for everyone selling and marketing on the Internet, particularly Spamazon.

PS: People are getting drunk more — to the tune of 13.1% more over last January.  Gee, I wonder if the lies are finally getting to ordinary folks……

Month to month changes in retail sales may be of importance to a retailer trying to pay his rent. In macro economics, no one really cares about it since holidays and seasonality play such a big part in retail. Restaurants and flower shops do better in February than January for obvious reasons. What matters is year over year. January 2015 was better than January 2014. But, Karl and his cult can have none of that so they focus on the month to month figure, which is meaningless.

As far as his comment about adjusted numbers, that’s nonsense. Lots of retail is done on weekends. If you gain a weekend day or lose a weekend day, it can make a big difference. The government plays games with the numbers so a certain amount of skepticism is warranted with regard to adjusted numbers. that does not mean all normalization of data is a fraud.