September 14, 2010
The media are anxious to find good economic news, hence they seized on the August retail sales data as evidence that the economy is moving forward again. While the 0.6 percent reported growth in non-auto sales is somewhat better than expected, it is somewhat less impressive when we remember that the July data were revised down by 0.1 percentage point.
Also, much of the growth was driven by higher gasoline sales, which is most likely due to higher prices rather than more consumption. Non-auto, non-gas sales were 0.5 percent higher than in August than in July and just 0.3 percent about the June level. This is not exactly robust growth.
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