With baseball season now in full swing, the coming week's lineup of economic reports features minor-leaguers. The best of the bunch is the government's look at March retail sales, due Friday morning.
The consumer's mindset is in a bit of a quandary these days. The most recent report on consumer confidence from The Conference Board showed a decline, linked to concern about the short-term outlook. On the other hand, the stock market has been locked in rally mode and the jobs picture has been steadily improving, generally speaking.
Auto sales in high gear
On the positive side of the equation, American consumers are buying again in many quarters. March auto sales, as reported by the manufacturers, were the strongest since August 2007. But to further fog the picture, the National Retail Federation predicted that Easter purchases of candy, decor, clothing and food would turn out to be flat compared to last year. The Easter Bunny wasn't exactly hopping along.
February retail sales rose 1.1 percent, and were up almost the same when auto sales were excluded.
Sales as flat as a tire on a road of nails
Hugh Johnson, chairman and chief investment officer with Hugh Johnson Advisors, looks for little change in the March retail sales number. Johnson says negatives weighing on the consumer sentiment include the expiration of the payroll tax cut, "concerns about Washington (D.C.), the sequester and the cut in government spending." But, Johnson notes, "when your car breaks down, you've got to buy a car."
Longer term, Johnson says, many consumers continue to reduce debt, a process that was brought on by the financial crisis.
No appetite for crises
Scott Brown, chief economist with Raymond James & Associates, says consumers are hanging in there pretty well. He notes that consumer spending, adjusted for inflation, was running at 3 percent to 3.5 percent higher in the first three months of the year. That accounts for about 70 percent of growth, or gross domestic product.
While Washington's paralysis has been much talked about, Brown thinks that a big part of that has been put behind since President Barack Obama signed a continuing resolution into law funding the government through the end of the fiscal year, Sept. 30. "Washington has gotten the message that people don't like governance by crisis," Brown says. He singles out Europe's lingering financial crisis as something that "could still be a big downside risk."
Inflation, what inflation?
One of the other key reports due this week involves the main gauge of inflation at the wholesale level. Put simply, rising prices have not been a big problem in recent times. And the news here is expected to be positive. The Labor Department releases the Producer Price Index on Friday. Wholesale prices recently have been seeing downward pressure linked to the decline in oil and gasoline costs.
Today in business history: House of 3-D
3-D movies have become big business in recent years. Their appeal has been driven by the need to do something different in theaters now that people can enjoy darn good content in their homes, thanks to DVDs, on-demand and streaming services. The premise of 3-D, however, dates back over a half-century. On April 10, 1953, "House of Wax" premiered starring Vincent Price and Carolyn Jones. It has been described as the first 3-D color feature from a major U.S. movie studio. Like today's versions, it required moviegoers to wear special glasses. While it was really campy by today's standards, "House of Wax" took in millions of dollars and also inspired a modern-day remake.
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