Overall retail sales in July rose 0.3%. That was above the gain expected by Wall Street and substantially above a decline posted in June. Consumer spending accounts for roughly 70 percent of all economic activity.
Annual total consumer inflation rates:
6.8 – July 1977
3.9 – July 1987
2.2 – July 1997
2.4 – July 2007
Another volatile/down week on Wall Street.
Wake me if the Dow falls all the way back down to 12,000 or lower. That would be a good point IMO to start buying selected blue chips — en masse.
BTW, if you’re retired and the recent volatility in the stock markets has you screaming, shouting, losing sleep, frothing at the mouth, etc., there’s a very important question you need to ask yourself: Why on earth are you invested in the stock markets?
If you’re already retired you need income and protection from inflation, not capital appreciation. You need minimal risk, not the massive risks inherent in common stocks. If you’re already retired there’s not a good reason to have any of your money in equities. You should be in money market funds. TIPS. CDs. Muni bonds. Commodities/materials. REITs. Fixed annuities. Perhaps a couple of preferred stocks. Not common stocks. If your home is paid off in full and you’re at least 62 years old then you should take out an equity conversion reverse mortgage. It’s a no brainer. Seriously.
Cause & Effect
Courtesy of USA Today here are the seven states with the highest hourly minimum wages:
$7.93 – Washington State
$7.80 – Oregon
$7.65 – Connecticut
$7.53 – Vermont
$7.50 – California
$7.50 – Illinois
$7.50 – Massachusetts
By way of comparison here are the seven states with the lowest unemployment rates:
2.3 – Montana
2.3 – Idaho
2.5 – Utah
2.5 – Hawaii
2.9 – Virginia
3.1 – Nebraska
3.2 – South Dakota
Made in China
Mattel announced its second major recall of Chinese-made toys.
I strongly suspect there are elements of our political fringes who will take that as a cue to demand blanket restrictions on imports of Chinese products. But import restrictions on basic commerce items are self-defeating. Furthermore the market for Chinese toys and such will correct itself in due course.
New home starts came in at an annualized rate of 1.38 million in July, below expectations and below an upwardly-revised reading of 1.47 million in June. Building permits in July were 1.37 million (annualized), below expectations and below an upwardly-revised figure of 1.41 million permits in June.
S.F. Bay Area Newspaper Owner Rejects Unions
The media chain that controls most major daily newspapers in the San Francisco Bay Area withdrew recognition of the labor union representing reporters and editors at the Oakland Tribune and four other papers.
MediaNews Group said the five publications are being consolidated with some of its other holdings, the nonunion Contra Costa Times and the Hills Newspapers.
Irony can be ironic, no?