The release of August 2010 advance monthly sales for retail and food services stated:
The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for August, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $363.7 billion, an increase of 0.4 percent (±0.5%)* from the previous month, and 3.6 percent (±0.5%) above August 2009. Total sales for the June through August 2010 period were up 4.7 percent (±0.3%) from the same period a year ago. The June to July 2010 percent change was revised from +0.4 percent (±0.5%)* to +0.3 percent (±0.2%).
Retail trade sales were up 0.5 percent (±0.5%)* from July 2010, and 3.7 percent (±0.7%) above last year. Nonstore retailers sales were up 10.5 percent (±2.8%) from August 2009 and gasoline stations sales were up 9.6 percent (±1.8%) from last year.
Remember this is ADVANCE data – and is determined by a weighted random sampling methodology which historically has been fairly accurate although too noisy to be taken to the bank.
Some analysts like to separate car sales and gasoline or whatever. My thinking is that Joe Sixpack only has so much money to spend. I have included the above table so to show the relative makeup of retail sales.
The problem this month is that the seasonal adjustment factors are very wrong.
Historically August retail sales are higher than July – yet the advance data shows that August 2010 is lower than July 2010.
I continue to emphasize that the seasonal adjustment factors are simply mindless quantitative exercises. You must look at the adjusted data with your eyes to see what is going on.