Retail sales mixed for April – recession has bottomed

Last month retail sales in the U.S. were down and strongly so, even friggin‘ Wal-Mart (ticker: WMT) posted negative same store sales growth and recessions are their bread and butter. “Everyday Low Prices” and all that. So most retailers have reported their April sales by now and have given us yet another sign that the recession has bottomed. Wal-Mart’s same store sales were up 5%. Other retailers have posted mixed sales growth. Yet last month sales were down pretty much across the board. In other words, consumers are coming out of their financial bunkers and are starting to spend, maybe not freely, but they are starting to make discretionary purchases.

The combination of increased consumer confidence; mixed, rather than down, retail sales; massive liquidation of business inventories; bank stress tests less severe than people anticipated; and massive government spending all indicate that the recession has bottomed. At this point a recovery could be stalled only by a massive unexpected event – such as a hurricane Katrina or a September 11th. Metaphorically, the patient is no longer in intensive care and its status is stable – now we need to prevent the risk for infection.

Have a wonderful day everyone!

Jason