Retail sales fell 1.2 percent in September to a seasonally adjusted $375.5 billion, the Commerce Department said on Wednesday. It was the sharpest drop since August 2005 and far greater than the 0.7 percent decline economists had expected.
"We have an all-out consumer retrenchment under way," said National City Corp chief economist Richard DeKaser in Cleveland, adding he expected the economy to shrink in coming months.
This shouldn't be a surprise. The market was taking some major hits in that month, the job market is contracting and housing is still a mess. It's time for people to stop spending. Period.
What is interesting is the retail holders ETF:
Note this ETF was trading in a range for most of 2008. A big reason is the Wal-mart and Target comprise almost 30% of the ETF. Both charts have been doing OK this year. Lowe's and Home Depot have been in a pretty wide trading range for the year as well. I have to wonder how long that trend will be continuing.