If you're in the market for clothes or holiday presents, this should be a pretty good season.
Retail operators and industry analysts have been worrying about growing stocks of unsold inventory since last spring, and now the results are starting to show up in store performance numbers.
Macy's third-quarter report, released yesterday, said sales were down more than five percent from the same period last year. Its stock price dropped much more than that, suggesting that jitters are ricocheting through the broader industry.
The graph below shows the larger picture -- a steady increase in inventory (green) against a slower rise in sales (blue) for clothing stores, starting early this year.
The chart below tracks the broader group of all retail inventories over a longer period. The worst years, 2009 and 2010, came after the Great Recession had clobbered consumer confidence. Now the inventory level is ticking up again, a trend that that began late last year.
Economists are puzzled for a couple reasons. First, employment growth has seemed to be strong this year. Second, energy prices, especially gasoline prices, have been very low.
Either trend would suggest that people would have more money in their pockets and therefore would be out shopping and buying more stuff. But that is not happening.
I am not a regular clothes shopper, but I have a few stores whose products I like. I visit them when one of my "routes" takes me into their neighborhoods.
The last two stores I visited, in September and earlier this month, had storewide sales under way. "All Women's Clothing 25% Off," was the sign in one. In the other case, a saleswomen phoned to give me the same message.
I bought a few things, but I don't think I'm going to be able to pull those stores out of their doldrums by the end of the year, which is what retailers seem to be fearing most. In addition to the goods now on display, there are products still arriving that were ordered months ago for the holiday gift-giving season, typically the busiest of the retail year.
My guess is that prices will be quite good for consumers through the rest of 2015.
As for the stores, not so much.