It’s all relative

Headlines yesterday stated that retail sales had “plummeted” 4% over the holiday season. Not quite as bad as the 20% drop that MasterCard allegedly reported the day before. As I said in the immediately prior post, we’ll see how it turns out. But, two things struck me about the 4% plummet:

1. When sales rise by 4%, it is a modest rise of 4%. So how can 4% be modest and a plummet. My math/engineering background is stumped on that one. Anybody care to help me with that?

2. Given that the media has been reporting the upcoming catastrophe since before Thanksgiving, and retailers responded with record low prices, it seems to me that a 4% drop in revenue has to constitute an increase in items sold since prices were more than 4% lower. Wow, so much for cutting back this year.

It seems to me that the media, especially the newspapers who rely on retail advertisers for much of their revenue, helped create the lower sales situation by driving retailers to need to lower prices to compete, thus lowering revenue and profits (oh, profits, that’s bad).  And then the media is surprised that their biased reporting and anti-business approach drives lower circulation and lower ad revenue, leading to their own demise. But, then maybe they think the media should get a bail-out too.

Mitch

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