Retail Sales Figures Stink!
let’s face it, today’s retail sales numbers stunk more than the Chicago Bears
locker room last Sunday in Green Bay. Some will look at
November’s 3.7% drop (vs. consensus estimates of 3.1%) and blame the auto
sector. That’s understandable, as the sector usually accounts for 25% of total
retail sales. Since gasoline prices fell $.15 per gallon (an 11% drop from
October), the cash register wasn’t ringing as loudly at gas stations either.
However, aside from a few fat cats at the likes of BP
PowerRating) and ExonMobil
falling gasoline prices are a good thing.
While Wall Street reacts negatively to the November retail sales report, I offer
you some statistics to consider:
to the American Petroleum Institute (API), American’s cars and trucks guzzle
8.48 million barrels of gasoline per day. Since there are 42 gallons per barrel,
that means we use 356.2 million gallons of gas per day. At a national average of
$1.20, that means we spend $427 million per day on gasoline. On a 30-day month,
such as November, that totals $12.8 billion. Thus, since prices at the pump fell
11% from October, consumers saved $1.4 billion dollars at the pump in November
($14.2 billion – $12.8 billion). If this savings occurred in August or
September, perhaps the impact on holiday spending would be muted, but given our
proximity to Christmas, I think this savings could quickly find its way into a
variety of merchants, benefiting both traditional and e-businesses.
I hope you will tune in to see “Doctor
J & the Traders”, on television in Milwaukee, Rockford,
South Bend and Peoria, or on the net at www.WebFN.com at
4:30 CT. Tonight my guests will be Tom Haugh, Fund Manger at www.ptisecurities.com,
Larry Parkhill, independent trader, and Benji Schwartz, CEO of JHWK trading.
We’ll be talking about the two versions of the stimulus package, the Fed’s rate
cut, November Retail Sales, Enron, and other market-moving stories. Please join
us for the best half-hour on television.
You can now e-mail me at drjandthetraders@Webfn.com
with questions and comments.