Holiday retail up a mere 3.6%; world to end

The New York Times ran a cover story today, the juxt of which is that holiday retail sales performed “weakly” compared to last year and that could be a sign of bad things to come. How bad could it be, you might ask? Negative growth? Recession? The answer: sales are “only” up 3.6% from last year.

Remember last year? Remember 2006? Remember how lean it was? Remember how many meals you had to skip? Remember when American obesity reached an all-time high? Remember how you wanted to get a new ipod and a new flat screen, but you decided to wait for a price drop on that ipod and ended up getting an iphone this June instead. Yeah. Well apparently this year was only 3.6% better than that. In fact, retail growth hasn’t been this low since the dark, dark days of 2002!

The Times is regurgitating numbers published this week by MasterCard Advisors, a division of MasterCard. During a given period, they’re able to draw on data from almost all purchases made with one of their affiliated credit or debit cards. They take these millions of transactions as a sample, in order to estimate the total sales numbers. According to MasterCard, retail sales are up 3.6% from last year. That includes just about everything bought or sold in a real-life, “brick and mortar” stores, including gasoline.

How much is that in dollars and cents? Seems like a good question right? What exactly was the total retail sales number for that period? Unfortunately, that’s either a question that the New York Times, the Wall Street Journal and CNN either neglected to ask or that MasterCard declined to answer. MasterCard doesn’t have a copy of their press release online but I’m guessing that the totals are missing from every major news source that covered this story today because that isn’t the message that the creditors and retailers want you to hear.  They didn’t say, for instance, that total sales came in at $375 billion, up from last year’s $362 billion.  That just wouldn’t sound as depressing.

Keeping in mind that we’re just talking about “holiday” sales numbers here, things get even rosier when you add the internet.  What’s that, you say.  We weren’t counting the internet?  No, in fact, if you add internet sales, combined holiday spending totaled $401.29; up 4.5% from last year’s $384.01.

Comscore, a market research company dedicated to serving internet businesses, reports that online sales totaled $26.3 billion, during the period from November 1 to December 21; an increase of 19 percent from the previous year.  Representing the interests of internet sales, Comscore clearly has an agenda.  Internet sales are up.  They aren’t up as much as the 26% growth they had last year but their up a lot and that’s exactly what they want you to hear; a message of optimism.

Mastercard, on the other hand seems to be doing everything it can to spin modest net growth pessimistically.  This begs the question why?  I’m not a business expert but it seems worth looking into.  Who profits from a Bear Market?  What does Mastercard have to gain here?