I’m still trying to puzzle out this news item. Apparently, inventories are higher and December sales lower than were expected:
Jan. 14 (Bloomberg) — Inventories in the U.S. rose more than forecast in November as companies tried to keep up with a jump in sales.
The 0.4 percent increase in stockpiles matched the previous month’s gain, marking the first back-to-back increase in more than a year, figures from the Commerce Department showed today in Washington. Sales advanced 2 percent, the most in two years.
A record reduction in stockpiles during the first nine months of last year means companies may pick up the pace of orders and production as demand improves. Gains in manufacturing, which accounts for about 12 percent of the economy, will help sustain the expansion in early 2010.
“Manufacturing output will need to ramp up further in coming months or inventories will soon be too lean to meet demand,” Mark Zandi, chief economist at Moody’s Economy.com in West Chester, Pennsylvania, said before the report.
A report earlier today from the Commerce Department showed sales at U.S. retailers unexpectedly fell in December following a gain the prior month that was larger than previously estimated. The 0.3 percent decrease came after a 1.8 percent jump the prior month. The government last month calculated the November gain at 1.3 percent.
The articles appears to be putting as happy a face on it as possible but doesn’t increasing inventories and declining retail sales mean a reduced likelihood of companies taking on employees? A recovery that’s petering out? That sounds more consistent with a double-dip recession than with a recovery.
Here’s a link to the Census Bureau’s report. Basically, it found retail sales falling relative to November 2009 and rising relative to December 2008. I don’t see that this constitutes evidence for a robust recovery well under way.