The March data showed that wholesale sales disappointed, and instead of growing 1.5%, declined by -1.6%, below expectations of a 0.1% rise. This was the biggest drop in sales since March of 2009: another nail in the coffin of any recovery dreams, showing that indeed the end-demand weakness has been quite widespread.  Sooner or later all this pent up inventory will have to be cleared, resulting in even more dumping, price reductions and margin deterioration in a retail world in which the bottom line is more elusive now than it has ever been. Just ask for a discount or walk away.

   There was no surprise in Initial Job Claims data, which continued the downward trend. The number came in at 323K, far below the expected 335K. The question remains whether the improving claim trend is due to fewer layoffs, or a lower marginal detachment workforce due to the labor force participation rate which was at 33 year lows for the second month in a low. At this point any additional substantial drops below the 300,000 range will likely mean a major distortion in the labor force as this is where claims numbers were at a time when the economy was actually strong, as opposed to the current liquified stock-market manipulated sham.

 

Reference Zero Hedge (Tyler Durden)                     www.donfilippo.ca

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