US retail sales in surprise climb (Sales rose by a better-than-expected 1% in May,)

BBC ^ | Thursday, 12 June 2008 15:33 UK 14:33 GMT, | BBC Staff

[Ernest_at_the_Beach]

US retail sales in surprise climb

Consumers spending is the biggest driver of the US economy.

US retail sales climbed by the largest amount in six months during May after spending was helped by tax rebates.

Sales rose by a better-than-expected 1% in May, the Commerce Department said, the largest rise since November.

It also said April's figure had been revised up to a rise of 0.4% against the previous estimate of a 0.2% fall.

Economists said the rise indicated that the economy had been given a boost by the stimulus package under which millions of Americans got tax rebates.

Core retail sales, which exclude car sales, rose 1.2%, the Commerce Department said.

Analysts had predicted that retail sales would rise by 0.6% and core retail sales would grow by 0.7%

Consumer spending is the key driver of US economic growth.

The stimulus payments were introduced to try to avoid a recession in the US by offsetting some of the gloom brought on by the credit crisis, housing market slump and surging energy bills.

The economy has also been hit by redundancies. Labor Department data released on Thursday showed that the number of new applications for unemployment benefits rose by 25,000 last week to 384,000 - the highest level since March and more than analysts had expected.

[geo40xyz]

Can't be!!! BO said were we CLEARLY in a recession:-()

[Ernest_at_the_Beach]

But we also have this:

US consumer gloom deepens in June

Page last updated at 14:56 GMT, Tuesday, 24 June 2008 15:56 UK

US consumer gloom deepens in June

Consumer spending is key to US economic growth.

US consumer confidence fell by more than expected in June, according to a key confidence survey.

The Conference Board's Consumer Confidence Index fell to 50.4, the lowest level since February 1992.

Confidence is down with the economy being hit by both a property slump and rising prices for food and fuel.

The Conference Board's survey is closely watched because consumer spending accounts for two-thirds of US economic activity.

June's figure was down from a reading of 57.2 in May, and below analysts' expectations of 56.5.

Economic gloom

"It's not hard to explain what's depressing consumers these days - you just need to look at gasoline prices and home values," said Dana Saporta, an economist at Dresdner Kleinwort.

Perhaps the silver lining to this otherwise dismal report is that consumer confidence may be nearing a bottom Lynn Franco, consumer research director, Conference Board

Meanwhile, the future remains bleak according to the Conference Board.

The percentage of consumers expecting business conditions to get worse over the next six months jumped to 33.9% from 32.9% the previous month.

And the percentage of those expecting fewer jobs to be created in the months ahead rose to 35.5% from 32.3%.

The confidence index, which is based on responses from 5,000 US households, has fallen steadily over the past year and stood at 111.9 last July.

The Conference Board's director of consumer research, Lynn Franco, believes the economy could be stuck in low gear for some time.

"Looking ahead, consumers' economic outlook is so bleak that the (Conference Board's) Expectations Index has reached a new all-time low," she said.

"Perhaps the silver lining to this otherwise dismal report is that consumer confidence may be nearing a bottom."

But the US Federal Reserve has signalled it has shifted its focus from recession fears to worries about the impact of inflation on the economy.

Federal Reserve policy makers, who begin a two-day interest rate meeting later on Tuesday, are expected to leave the cost of borrowing at 2% on Wednesday.

Analysts believe rising inflation could push up interest rates later in the year.

[rabscuttle385]

Even a dead cat will bounce if it falls from a great height.

[Cementjungle]

Must be the economic stimulus package!

[Ernest_at_the_Beach]

Meanwhile in Vegas:

Banks, buyers loath to seal condo deals,/b>

*******************************EXCERPT************************

A few bright spots, but closing process slows overall as glut of high-rise units hits market

By Liz Benston

Sat, Jul 12, 2008 (2 a.m.)

Condo and Condo-hotel Units Breakdown

Take an in-depth look at how well Vegas's condo and condo-hotel units are faring in the current economic downturn.

Sun Topics

• Real Estate in Crisis

Sun Archives

• Video: Condo-hotels on the Strip (5-20-2008)
• Strip’s vaunted condo-hotels losing their luster (5-20-2008)
• Developers offering a new kind of suite deal with condo-hotels (1-2-2006)

Beyond the Sun

• Trump International Hotel & Tower
• Panorama Towers
• Turnberry Towers
• Palms Place
• Allure

Selling high-rise condominiums in this town and closing escrow on them are separate challenges in today’s economy, a Sun analysis has found.

Although purchase contracts have been signed on most units in the most prominent high-rises, the escrow process has slowed to a crawl as lenders move cautiously in making loans.

Of 2,558 units that opened escrow this year in projects of 50 or more units, 77 percent are still in escrow. Of 3,095 units in this category that opened escrow in 2007, a third are still in escrow.

“If it was three months before, it’s now taking six months,” said Richard Lee, a vice president with First American Title Co. in Nevada. “We’re dealing with lending requirements we haven’t seen before. Banks are afraid of their own shadow right now.”

[Ernest_at_the_Beach]

Also from the Las Vegas Sun:

Real Estate in Crisis

*************************EXCERPT***************************

The subprime mortgage crisis is hitting the Las Vegas metro area particularly hard. In fact, Nevada has the highest foreclosure rate in the country and the metro area is consistently one of the top five worse in the nation. The crisis jeopardizes further growth by creating an overflow of available homes, which in turn slows the construction of new homes and invariably effects property values. But at the same time it creates opportunities of more affordable housing for those who have been priced out of the market in recent years.

The crisis entails homeowners losing their houses after they are unable to afford their mortgage payment. It was brought about by lenders and banks giving risky loans, or subprime mortgages, to people with poor credit scores or finances.

[Ernest_at_the_Beach]

FR Thread:

Layoffs And Closings Help Explain Why Media See 'Depression' As Real [MSM Bias Must Read]

[Ernest_at_the_Beach]

And this is interesting....FR Thread:

Energy war: India and China face off in Central Asia

[am452]

Bloomberg said the retail figures are bogus and misleading. High priced gas at the pump is considered retail and is thrown in the mix also. It’s inflating the numbers.

[Mase]

Doom has been temporarily postponed ping.

[stboz]

HINT: The money’s being spent on GASOLINE.

[1rudeboy]

I suppose I could claim credit for “free trade,” but I’m not that stupid.

[randita]

Economists said the rise indicated that the economy had been given a boost by the stimulus package under which millions of Americans got tax rebates.

To which the Democrats were led kicking and screaming. If it worked once, why not try it again?

[USNBandit]

Actually I moved in May and my wife has been buying stuff for the new house.

She is a one woman economic boost, despite the damage she is doing to my fiscal surplus.

[montag813]

Isn’t this data usually released during the week? Is the Fed trying to help index futures tonight?

[lonestar67]

I wonder why this is reported in British press but not in American press.

Oh wait, its and election year and a Republican is President— right.

[expat_panama]

Isn’t this data usually released during the week? Is the Fed trying to help index futures tonight?

This came out more than a month ago: 

Economic Indicators - June 12, 2008
For	Time	Title	Actual	Revised	Consensus	Briefing	Prior
May	08:30	Retail Sales	1.0%	-0.2%	0.5%	0.6%	0.4%

--and tomorrow the numbers will be coming out for June.  The only BEA news this weekend from the Commerce Dept. isn't retail sales, it's trade.   From last Friday's press release:  "Exports of goods increased $0.8 billion to $110.8 billion, and imports of goods increased $0.3 billion to $183.3 billion. Exports of services increased $0.6 billion to $46.7 billion, and imports of services increased $0.4 billion to $34.0 billion."   In short, the 'trade deficit' shrank but we're not supposed to be talking about it because---[connection severed]

[Ernest_at_the_Beach]

Thanks.

[Marysecretary]

If the media and Congress and everyone else would quit talking about how bad the economy is... it’s like a curse when they keep saying it’s bad, it’s bad, it’s bad. Even if it isn’t, they’ll keep repeating that mantra. Kind of a self fulfilling prophecy.