Why This Economy Is Now Running Aground

[marmar]

Why This Economy Is Now Running Aground
by Wolf Richter • April 13, 2016


[font color="blue"]Business sales worst since 2012, inventories at crisis level, jobs next.[/font]

Total business sales fell again in February, the Commerce Department reported today. They include sales by manufacturers, retailers, and wholesalers of all sizes across the US economy. This measure is far broader than the aggregate sales by publicly traded companies, which too have been falling.

At $1.284 trillion in February, total business sales were down an estimated 0.4% from January, adjusted for seasonal and trading-day differences but not for price changes. And they were down 1.4% from the already beaten-down levels of February last year. They’re back where they’d first been in November 2012!

By segment: Manufacturers’ shipments fell 3.5% year-over-year to $444.6 billion. Sales by retailers rose 3.1% to $360.6 billion, propped up in part by auto dealers. And sales by wholesalers fell 3.1% to $395.8 billion.

With optimism running wild about a booming Fed-designed future, executives have been hoping in aggregate that sales next month and next quarter would be better. But these wishes just haven’t come true. So now, way behind the curve, they’re struggling to bring their bloated inventories in line with the reality of their sales.

Manufacturers were able to trim their inventories by 2.3% year-over-year, and wholesalers were able to whittle them down 0.6%, but retail inventories soared 5.9% after having already jumped 5.7% in January following a lousy holiday season. ............(more)

http://wolfstreet.com/2016/04/13/economy-runs-aground-total-business-sales-fall-inventories-at-crisis-level-jobs-threatened/

[Downwinder]

1. You can't buy much running on OASDI.

[Punx]

2. As wealth is concentrated

In fewer and fewer hands, there will only be so much that those remaining few can buy along typical consumer lines at least.

This should be obvious, so the question to me is that; are those that orchestrate this so greedy they miss this, or is there some other goal in mind?

I'd argue clueless for some of their media shills like Thomas Friedman.

[Warpy]

3. This economy is running aground because the demand side has been choked off

There it is in one simple sentence.