ADJUSTING FOR (DE)FLATION....The New York Times reports on consumer activity:
The price index for finished goods, a measure of the change in prices businesses pay, fell 0.9 percent in August after a 1.2 percent increase in July, according to the Bureau of Labor Statistics.
Consumers' spending on retail and food decreased 0.3 percent in August after a 0.5 monthly drop in July, according to the Census Bureau. Economists had been expecting an increase of 0.2 percent.
Does this mean that actual sales of goods and services were down 0.3 percent? Or, if you adjust for inflation, does it mean that retail sales were actually up?
I have no idea, and nowhere in the NYT piece do they tell you. Nor do the Washington Post or the Wall Street Journal. The only way to find out is to go to the Census Bureau press release itself, which says:
The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for August, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $381.2 billion, a decrease of 0.3 percent (±0.5%)* from the previous month, but 1.6 percent (±0.7%) above August 2007.
So the reported drop is from July to August, not from last year. And it's not adjusted for inflation. Actual, inflation-adjusted sales were probably up a bit compared to last month, but down about 4% from last year.
This is all a bit murky since we don't have final inflation/deflation numbers yet for August, and overall I don't know if this is good or bad news anyway. But that's the news. Why can't the financial press report it?