Wikinvest Wire

America goes shopping ... at Home Depot

Thursday, June 12, 2008

That rebate money is starting to show up at retailers in a big way. The Department of Commerce reported retail sales rose 1.0 percent from April to May with a giant 2.4 percent increase in spending at building material and garden supply stores.There were also some large upward revisions to prior month's data - sales in March were revised from a gain of 0.2 percent to 0.5 percent and April sales improved from a decline of 0.2 percent to a gain of 0.4 percent.

From year-ago levels overall sales are now up 2.5 percent, a figure that is not adjusted for inflation and therefore, in real terms, is still negative.

Sales at building material and garden equipment stores have posted big month-to-month gains for two months now but remain down 3.2 percent from a year ago.
Of course, gasoline station sales led the way in May posting a 2.6 percent gain despite motorists logging fewer miles. From year ago levels, spending at gasoline stations is up 13.8 percent.

The Treasury Department began sending rebate payments in late-April and reportedly sent about $50 billion out in May.

As a point of reference, the 2.4 percent increase in spending at building material and garden equipment stores during May amounts to about $660 million and the 2.6 percent increase at gasoline stations comes out to roughly $1.1 billion.

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6 comments:

Investorazzi.com said...

Must be sweet music to the ears of billionaire hedge-fund manager Eddie Lampert, who's been acquiring shares of Home Depot.

"Edward Lampert's Been Busy Acquiring Housing-Related Stocks"
http://www.investorazzi.com/2008/06/12/edward-lampert%e2%80%99s-been-busy-acquiring-housing-related-stocks/

Anonymous said...

I hear they are getting Stimulus - Round 2 ready to go. The current cash infusion should run its course in another couple weeks and then its back to the downward trend. Keynesian economics at its best.

Anonymous said...

I'm surprised you missed this, Tim.

Are these numbers already inflation-adjusted? If not, it's pretty obvious that if real inflation (as per shadowstats.org) is running close to 1%/month then a 1% increase in sales really be flat, wouldn't it?

And even if they are using the bogus government calculated deflator, it's just a very modest gain, one that might be accounted for by things like weather, number of weekends in the month, etc.

This is another one of those headlines that are spun to make a negative look positive.

Tim said...

Didn't miss it:

From year-ago levels overall sales are now up 2.5 percent, a figure that is not adjusted for inflation and therefore, in real terms, is still negative.

albrt said...

I spent some money at Home Depot over the last few months. Mostly working on my truck garden and similar projects that will ultimately be deflationary for the US economy.

Anonymous said...

atmosphere at home depot is slightly better than pond scum. They're cheap, but then when you can't find anything you're stuck trying to get help from a high school dropout.

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