As 2023 comes to a close, holiday shoppers offered yet another sign that the U.S. economy will roar into the new year. On Tuesday, fresh retail sales data from Mastercard showed that consumers spent big on gifts, meals and apparel in November and December.... U.S. retail sales between Nov. 1 and Dec. 24 were up 3.1 percent compared with the same period a year before, according to Mastercard SpendingPulse, which measures sales in-store and online across various forms of payment.
Inflation from November to November was also 3.1%. That means real holiday spending this year was precisely the same as last year. Nothing roared and no one spent big.
For God's sake, when will our nation's innumerate reporters knock off this nonsense? This particular piece notes in the fifth paragraph....
(The overall report excludes car sales and is not controlled for inflation.)
....but there's nothing to stop news writers from doing it themselves. The numbers are hardly a secret.
They don't know how.
As a long-time veteran of the retail industry, I can tell you that retailers don't adjust for inflation when they evaluate their results. They rely on a simple year-over-year comparison.
I believe this and yet… I wonder how the nation’s oldest retailers then explain how revenues went from thousands to millions to billions from WWII through today…?
Because they're awesome.
They were promised no math, and they’re going with what they know.
Another way to phrase this: Spending kept up with inflation.
So Kevin, you want a story on how things aren’t getting any better?
Holiday retail spending excludes many, many items that are part of the overall PCE/CPI inflation calculation.
Adjusting a small subset (holiday retail) of items by the overall inflation rate might be easy, but it is not accurate and doesnt provide any meaningful information.
If its lazy and innumerate for writers to ignore inflation, then it is also incredibly lazy and innumerate to use the wrong inflation value because its something you have on hand and you dont want to do any work to provide a meaningful number.
For what it's with, here's the first two paragraphs of the corresponding NYT report:
"Despite lingering inflation, Americans increased their spending this holiday season, early data shows. That comes as a big relief for retailers that had spent much of the year fearing the economy would soon weaken and consumer spending would fall.
"Retail sales from Nov. 1 to Dec. 24 increased 3.1 percent from a year earlier, according to data from Mastercard SpendingPulse, which measures in-store and online retail sales across all forms of payment. The numbers, released Tuesday, are not adjusted for inflation."
(Front page of the Business section; appears at the very top of the Today's Paper website.)
Never. They will never knock it off because they are innumerate.
Thirty years after America adopts an educational system that effectively teaches mathematical intuition to two-thirds of all students, that is when the reporters will knock it off: after they are no longer innumerate.
Reporters must write about "anything" to get a story in their allotted slot in the news. Gotta fill the pages with trash news.
I wonder who makes these framing decisions. Is it the reporters themselves? Or are they getting marching orders from their chief editors and/or marketing departments?
there's a small cabal led by the ghost of hugo chavez who makes all editorial decisions for the world's media (except of course for fox news), including not adjusting anything for inflation just to annoy mr. drum.
note that there is no real advantage for retailers to hide or distort numbers, since most of the major ones are publicly traded and will have to disclose real numbers publicly in short order.
hey i have an idea! how about the folks that produce these numbers, who are (supposedly) mathematically literate, adjust them for inflation? if you're going to put out a report for mass distribution why not make it easy for anyone who picks it up to understand it fully?
It is already easy to understand. Nominal sales of a subset of the economy make sense and are easy to understand.
Imagine that you are selling retail stuff of all kinds. Toys, clothes, kitchen gear, electronics, etc.... Now imagine that you sold $500,000 of stuff, 5% more than last year.
What does the price change of houses and medical care have to do with your sales? Does it change your story if house prices in the US went up 10%? Or down 14%? Did you suddenly do worse in the first case and better in the second?
Is anyone better informed if you say that your sales went up 5%, but lets adjust for the price change of things that have no impact on your sales and now we will say sales are down? Or maybe sales are actually up 5%, but because of flattening medical costs,lets pretend that sales are actually up 9%!!
This would be less accurate, readers are less informed and it would be the definition of innumeracy.
Scrooge here! So much of this Xmas-related spending is on unwanted stuff, disappointing gifts, way too much postage, and packaging waste. Let's not even mention the greeting card industry (since I haven't sent mine out yet...) I guess if it keep the retailers fat and happy, we have to consider it to be "good", right?