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Retail Sales Rebounded In January -- first gain in 7 months

This is the real reason the "stimulus" bill had to be passed in such a rush -- it had to be done before the economy had a chance to rebound on its own. My theory, which comes from personal experience and observation, is that when gas prices dropped so significantly over the past few months it put extra cash in peoples' pockets. I estimate my family has an extra hundred bucks or so a month as a result of less than $2/gallon gas. I don't know if that contributed to the increased retail sales, but it has made a difference in my house. Via the AP/Reuters:

Sales at U.S. retailers unexpectedly rebounded in January, new government data showed Thursday, likely boosted by post-holiday discounts and providing a glimmer of hope for the recession-hit U.S. economy.

The Commerce Department said total retail sales rose 1 percent, advancing for the first time in seven months, after slumping by a revised 3 percent in December, previously reported as a 2.7 percent decline.

The January report shows strong increases in sales of automobiles and in general merchandise stores -- the "big box" outlets -- though sales by department stores, carrying fewer varieties of items, posted a decline.

And this happened without a trillion dollar spending bill. This is just one number of one economic indicator from one month, but it sure doesn't jibe with the worst recession since the Great Depression doom and gloom catastrophe "if we don't pass spendulus now we will NEVER recover" talk Obama and the Democrats used to get their trillion dollar wish list passed.

UPDATE: I like Jim Hoft's spendulus name better than mine -- from his post explaining why Republicans are so upset with Specter, Snowe and Collins:

How anyone can vote for the Trillion-Dollar-We're-All-Going-To-Die-Unless-The-Government-Pays-Off-Liberal-Interest-Groups Bill and still insist they are a Republican or conservative is beyond belief. After all, there's not too many socialists in the party. Dick Morris nailed it last night on The O'Reilly Factor. He said if the three traitors would have voted "no" democrats would have been forced to come up with a better bill. They didn't. Now we have this liberal pork-laden trillion dollar crap sandwich to chomp down.


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Comments (10)

Larry Kudlow's column on 2-... (Below threshold)

Larry Kudlow's column on 2-6-09 went into some of the deep numbers on this - also showing that the rush was to beat the rebound.
--
"Mustard seeds planted a while back are now pointing to economic recovery. The huge energy tax cut is one such mustard seed. The related inflation collapse is another. By the way, in today's jobs report, wages rose again, and now stand nearly 4 percent higher than a year ago. With zero inflation, that's a real increase in worker purchasing power for the 92.4 percent, or 135 million workers, still employed...

Monetary lags are long and variable. But the money supply historically kicks in somewhere between six and 12 months. Through January we've had five months of money stimulus. So stocks may now be telling us that the gloom-and-doom crowd -- and its pessimistic economic prognostications that cover all of 2009 and in some cases 2010 -- is about to be proven wrong."
--
What are the chances that Pelosi & Co. had advance warning of the uptick in retail numbers - hence their GOP-less hurryhurry session to get a deal done - a deal to spend a trillion bucks described by the press this morning as "in lighting time". I know that's how we make financial decisions in our house - "in lightning time".

I agree. Obama will get th... (Below threshold)
Adrian Browne:

I agree. Obama will get the political credit for the tax cuts in the bill as well the improvement in the economy in general.

This cannot be true. Barry ... (Below threshold)
WildWillie:

This cannot be true. Barry said we were in a horrible crisis that will only go into an unrecoverable catastrophe. Didn't you hear him. ww

Not to rain on your parade,... (Below threshold)
GarandFan:

Not to rain on your parade, but since the middle of January, gas prices in SoCal have gone UP about 37 cents a gallon. This morning the price per gallon went UP by 10 cents overnight.

Arnie and the Democrats in Sacramento insist they need MORE tax money to fill a $42 BILLION deficit caused by several years of runaway spending (UP 30% since Arnie became governor).

Yeah, the economy is going to turn around here real soon.

GerandFan,Read my po... (Below threshold)
Lorie Byrd:

GerandFan,
Read my post. I didn't say the prices would remain low, just that they dropped below $2/gallon the past few months -- at least here in NC -- and that may be the reason people had more money to spend. I was in California (San Diego, LA and Long Beach) in early December and at that time gas prices were pretty close to what they were here at the time -- around $1.75/gallon. We are now around $1.85-1.95/gallon here in NC. If gas shoots back up to $4/gallon like it was a few months ago people are not going to have as much money in their wallets. I don't think I am going out on a limb saying that. Whatever gas prices do though, I don't see this spending bill doing much about them.

Lori:I agree with yo... (Below threshold)
GarandFan:

Lori:
I agree with your premise, an infusion of cash will stimulate the economy more then that crap sandwich in Washington. That infusion has to be steady and dependable before people start going out and buying again. Nancy's Pork Program will average about $13 per family every two weeks. That should cover the rising cost of gasoline. Of course, the new Sec of the Interior canceling oil leases is really helping as well. If and when the economy does come back, we can start shoveling all that oil money off shore again.

America is getting scammed ... (Below threshold)

America is getting scammed with the stimulus bill.
http://www.rightklik.net/

That infusion has to be ... (Below threshold)
_Mike_:

That infusion has to be steady and dependable before people start going out and buying again

AKA tax cut.

"AKA tax cut"Yes i... (Below threshold)
GarandFan:

"AKA tax cut"

Yes indeed. I get $1100 a month taken out of my paychecks for federal taxes. Now what if I were to suddenly have an added $500 a month in discretionary funds? Hell, what if every wage earner had an added $200-$300 a month?

But Nancy doesn't want that. SHE WANTS TO SPEND IT. SHE HAS BETTER IDEAS.

And down the road...WE are going to get the bill.

As I have said many times i... (Below threshold)
Wayne:

As I have said many times in the past, our economy depends on relatively cheap and reliable energy. The sharp increase last year of petroleum hurt our economy more than any other single factor. The drill here drill now outcry help turn that around. However if the Democrats succeed in limited drilling again, new refineries, power plants, or greatly increasing the taxes on energy, the economy will tank.




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