Retail sales post strongest gains since late 2007

[her209]

http://www.google.com/hostednews/ap/article/ALeqM5jEUOBuLQexhEw6Sbb1sU7mSLR6iAD9E837VG2

NEW YORK — Shoppers returned to the nation's malls last month, buying a surprising amount of spring clothing and other items and helping stores post the strongest retail sales since November 2007, a month before the recession began.

The better-than-expected 3.7 percent gain reported Thursday showed that Americans are still thrifty, but they are letting go of some of the frugality brought on by the economic downturn. And many are willing to spend for certain higher-end goods.

Consumers "are now starting to go back to where they had typically shopped" before the recession, said Michael Niemira, chief economist at the International Council of Shopping Centers, who expected a 2 percent gain. "I'm surprised by the broad strength."

But, he added, there's still uncertainty about whether such a robust pace can be sustained, particularly later this year when the sales figures are being compared with more stabilized spending patterns.

(more)

Another sign the economy is recovering?

 

[dainthomas]

It's all Obama's fault!!!!!!

 

[Jaskalas]

I wonder how the unemployed are contributing to this number.

 

[Dissipate]

Say hello to inflation and consumer debt.

 

[Zebo]

I'm watching new home sales and sales tax recipients both hard numbers - when they start rising then you'll know economy is on it's way up.

 

[werepossum]

I'm watching new home sales and sales tax recipients both hard numbers - when they start rising then you'll know economy is on it's way up.

New homes sales will probably lag far behind because so many good houses are already on the market, often for much less than a couple years ago.

This is bizarre because consumer confidence is at record lows. But it's really good news and I hope things really take off. Commercial construction is still completely dead - companies are waiting to see how much damage will be inflicted by health care reform, cap and tax, and tax and regulatory reform. When those issues are settled one way or the other, hopefully we'll see construction coming back.

 

[sandorski]

A good sign, but have to wait to see if it becomes a Trend.

 

[DucatiMonster696]

One month does not equal a recovery. Unemployment rates are still sky high despite the fudging of the numbers to not include people whose unemployment extensions have run out.

 

[werepossum]

One month does not equal a recovery. Unemployment rates are still sky high despite the fudging of the numbers to not include people whose unemployment extensions have run out.

Clearly it's not the end. It's not even the beginning of the end. But it might be the end of the beginning (to mangle Churchill), the point at which things begin to trend better on balance. If so, that's a very good thing. If not, well, it's still a small bright spot (or maybe a small not-quite-so-dark spot?) in an otherwise gloomy time.

 

[heyheybooboo]

I'm watching new home sales and sales tax recipients both hard numbers - when they start rising then you'll know economy is on it's way up.

The good news is it sold.

The bad news is it sold for $.30 on the dollar ....

UCity office park sold for 30 cents on the dollar
Sale of Meridian Corporate Center, once valued at $150 million-plus, reflects trend of distressed selling

IBM's former home in University City has been sold for $42 million to a Rockville, Md., firm that specializes in distressed properties.

BECO Management paid about 30 cents on the dollar for the Meridian Corporate Center, purchasing it from Hartford Financial Services Group after the previous owner defaulted on a $120 million loan.

One man gathers what another man spills.

Until banks, REITs, et. al., reconcile the 'commercial' property house of cards we won't be out of the woods.

A dude on the News Hour tonight said we need to create 11 million jobs to reduce unemployment below 5%.

My fear it that there will be a new 'baseline' unemployment of 6-7% (if we are lucky). If 120k persons enter the job market a month (and the News Hour dude was close with his numbers), the US needs to create 17 million jobs in the next 4 years to come close to 5% unemployment.




--

 

[Jaskalas]

My fear it that there will be a new 'baseline' unemployment of 6-7% (if we are lucky). If 120k persons enter the job market a month (and the News Hour dude was close with his numbers), the US needs to create 17 million jobs in the next 4 years to come close to 5% unemployment.

So we're not even digging out until we reach 120k+ new jobs / month. Until that time, this hole is getting deeper.

 

[werepossum]

The good news is it sold.

The bad news is it sold for $.30 on the dollar ....

UCity office park sold for 30 cents on the dollar
Sale of Meridian Corporate Center, once valued at $150 million-plus, reflects trend of distressed selling



One man gathers what another man spills.

Until banks, REITs, et. al., reconcile the 'commercial' property house of cards we won't be out of the woods.

A dude on the News Hour tonight said we need to create 11 million jobs to reduce unemployment below 5%.

My fear it that there will be a new 'baseline' unemployment of 6-7% (if we are lucky). If 120k persons enter the job market a month (and the News Hour dude was close with his numbers), the US needs to create 17 million jobs in the next 4 years to come close to 5% unemployment.




--

+5 for gratuitous Grateful Dead/Rob Hunter quote.

 

[Hacp]

We lost 37000 jobs and they call that good? The bar keeps getting moved further and further back.

 

[DesiPower]

We lost 37000 jobs and they call that good? The bar keeps getting moved further and further back.

Its not Obama's fault, Bush started it

 

[Slew Foot]

U6 went up 0.3% i think, thats a better indicator.

 

[TastesLikeChicken]

Could be a sign. Consumer borrowing was up in January -

http://www.msnbc.msn.com/id/35729570/ns/business-stocks_and_economy/

- so that may account for a good chunk of it.

 

[Moonbeam]

We lost 37000 jobs and they call that good? The bar keeps getting moved further and further back.

That caused stocks to rise today because the cold weather prevented hiring and the numbers were expected to be about 100 thousand worse, so it's not the bar that moved but the fact you don't know what the fuck is actually happening.

 

[Zebo]

New homes sales will probably lag far behind because so many good houses are already on the market, often for much less than a couple years ago.

This is bizarre because consumer confidence is at record lows. But it's really good news and I hope things really take off. Commercial construction is still completely dead - companies are waiting to see how much damage will be inflicted by health care reform, cap and tax, and tax and regulatory reform. When those issues are settled one way or the other, hopefully we'll see construction coming back.

I think we are in the first inning of Commercial and sixth on residential. Once government stops bailing out equity with various schemes it will be allowed to hit bottom and then vultures come in and buy buy buy like crazy then improve them which creates jobs and the rest is history till next bubble.

 

[Jhhnn]

I think we are in the first inning of Commercial and sixth on residential. Once government stops bailing out equity with various schemes it will be allowed to hit bottom and then vultures come in and buy buy buy like crazy then improve them which creates jobs and the rest is history till next bubble.

You seem to think this is the usual sort of boom/bust. it's not-

http://www.ritholtz.com/blog/wp-content/uploads/2009/06/case-shiller-updated-1024x804.png

We've had a nice little suckers' rally, that's all... recovery from speculative market peaks doesn't occur from the top down, but rather from the bottom of the corresponding trough afterwards, and we're not there yet. American real estate will likely follow the same path of Japanese real estate in the 90's- slow decline and stagnation. It avoids the trough, keeps the banks in business, even if they are zombies...

 

[heyheybooboo]

So we're not even digging out until we reach 120k+ new jobs / month. Until that time, this hole is getting deeper.

Yup. I suspect I 'low-balled' that 120k jobs/month by as much as 20%.

+5 for gratuitous Grateful Dead/Rob Hunter quote.

Trouble with you is the trouble with me,
We got two good eyes and we still can't see ....




--

 

[LegendKiller]

You seem to think this is the usual sort of boom/bust. it's not-

http://www.ritholtz.com/blog/wp-content/uploads/2009/06/case-shiller-updated-1024x804.png

We've had a nice little suckers' rally, that's all... recovery from speculative market peaks doesn't occur from the top down, but rather from the bottom of the corresponding trough afterwards, and we're not there yet. American real estate will likely follow the same path of Japanese real estate in the 90's- slow decline and stagnation. It avoids the trough, keeps the banks in business, even if they are zombies...

I don't personally think prices will go down according to that projection, at least not in nominal terms. Prices will begin to go up but I think they won't keep up with inflation, resulting in price "declines" in real value.

 

[StageLeft]

That caused stocks to rise today because the cold weather prevented hiring and the numbers were expected to be about 100 thousand worse, so it's not the bar that moved but the fact you don't know what the fuck is actually happening.

You actually bought that snow storm line? Sounded like bullsh*t. Anyway, the gov did not quantify it because nobody can, but when the numbers came in better yesterday the general sense was that the weather had not made much of an impact. Maybe next time the numbers are bad the gov will blame it on somebody getting booted from american idol.

What is a recession, really? In the general sense it means the economy is either getting stronger or better. For anybody in the employed side of the economy or reliant upon somebody in the employed side of the economy (i.e. damn near everybody) this starts with jobs and ends with jobs. And that doesn't mean the classical definition of unemployment, it means the true definition of employment. People actually employed in full-time jobs that are not substantially below their skill set are in fewer numbers than they were a couple of months ago so as far as the average joe is concerned things are worse, regardless of any GDP number. And GDP may hint at a near future of gaining employment, or it may not.

Taxes and income are important but if you are out of work the rest is just noise. It is all that matters.

 

[Moonbeam]

You actually bought that snow storm line? Sounded like bullsh*t. Anyway, the gov did not quantify it because nobody can, but when the numbers came in better yesterday the general sense was that the weather had not made much of an impact. Maybe next time the numbers are bad the gov will blame it on somebody getting booted from american idol.

What is a recession, really? In the general sense it means the economy is either getting stronger or better. For anybody in the employed side of the economy or reliant upon somebody in the employed side of the economy (i.e. damn near everybody) this starts with jobs and ends with jobs. And that doesn't mean the classical definition of unemployment, it means the true definition of employment. People actually employed in full-time jobs that are not substantially below their skill set are in fewer numbers than they were a couple of months ago so as far as the average joe is concerned things are worse, regardless of any GDP number. And GDP may hint at a near future of gaining employment, or it may not.

Taxes and income are important but if you are out of work the rest is just noise. It is all that matters.

Just because I post something doesn't mean I buy it. But the market did go up, my friend and I heard it was tied to that reason, so somebody bought something.

My real point was that a decline is not a decline when the decline is less than expected, except for those with a mechanical view of things and no depth of understanding. The bad news is you have a cyst. The good news is it's not cancer.

 

[Jhhnn]

I don't personally think prices will go down according to that projection, at least not in nominal terms. Prices will begin to go up but I think they won't keep up with inflation, resulting in price "declines" in real value.

The chart is inflation adjusted, LK. I personally think the projections are optimistic, for a lot of reasons. Current interest rates are unsustainable, and millions of families are basically in lockdown in their current residences, with valuations lower than outstanding balances. High foreclosure rates are ongoing, while un- and under- employment won't be going away anytime RSN.

Both the FRB and regulators allowed housing and commercial real estate to become speculative markets, and certain behaviors are common to all speculative markets. The speculative price area above the honest equilibrium price point is followed by a corresponding area below it, in general terms. That area can be balanced either with strong price depression for a short time period, and generally is, or it can be softened, spread out over a much longer timeframe with market controls, which is what's happening today. Investors, particularly small investors, won't step in to buy distressed properties, drive prices upward again until such are seen as a terrific bargain, and they're not, not yet. They don't have to buy, so they don't.

Actual equilibrium price on the index looks to be ~115, since 1980 or so. So prices will have to go very low for a few years, or somewhat lower than that for a very long time to balance the area of the speculative peak above that.

Families can only afford just so much of their income for housing if they're to support the rest of the general economy, too. There's a tradeoff there. Lots of families are "house poor" and underwater at the same time. Unfortunately, however, the economic cure for the current glut of overpriced overbuilt housing would devastate the financial industry in general, so that simply won't be allowed to happen.

 

[LegendKiller]

The chart is inflation adjusted, LK. I personally think the projections are optimistic, for a lot of reasons. Current interest rates are unsustainable, and millions of families are basically in lockdown in their current residences, with valuations lower than outstanding balances. High foreclosure rates are ongoing, while un- and under- employment won't be going away anytime RSN.

Both the FRB and regulators allowed housing and commercial real estate to become speculative markets, and certain behaviors are common to all speculative markets. The speculative price area above the honest equilibrium price point is followed by a corresponding area below it, in general terms. That area can be balanced either with strong price depression for a short time period, and generally is, or it can be softened, spread out over a much longer timeframe with market controls, which is what's happening today. Investors, particularly small investors, won't step in to buy distressed properties, drive prices upward again until such are seen as a terrific bargain, and they're not, not yet. They don't have to buy, so they don't.

Actual equilibrium price on the index looks to be ~115, since 1980 or so. So prices will have to go very low for a few years, or somewhat lower than that for a very long time to balance the area of the speculative peak above that.

Families can only afford just so much of their income for housing if they're to support the rest of the general economy, too. There's a tradeoff there. Lots of families are "house poor" and underwater at the same time. Unfortunately, however, the economic cure for the current glut of overpriced overbuilt housing would devastate the financial industry in general, so that simply won't be allowed to happen.

I know that about the S&PCS index, which was my point, I don't see the market plummeting still. I track the index quite a bit and I've even had the opportunity to talk to Shiller.

You're actually very wrong about speculative markets, there is no sure-fire scenario post-bubble. Any scenario can happen. You're extrapolating it as certainty, when it is not.

As far as distressed debt investors, you're very wrong. The FDIC is auctioning off stuff left and right and doing it successfully. There are tons of pockets of liquidity lapping up these assets, good banks are buying bad banks. Many funds are buying this stuff.

Cash buyers are buying into housing, there are plenty of stories about this all over the place.

You're not looking at the whole picture. I'm not saying things are great, but they aren't nearly as bad as you're making them out to be.