RETAIL SALES SLIDE IN SEPTEMBER. AND BASED UPON SALES TAX RECEIPTS, CALIFORNIA IS IN A RECESSION.

From an article today on Yahoo entitled “Retailers Report Sluggish September Sales As Hot Weather, Economic Worries Curb Spending”:

NEW YORK (AP) -- Several of the nation's largest retailers cut their earnings forecasts Thursday after lingering summer weather and an uncertain economy kept consumers from shopping last month and left the big merchants with disappointing sales.

As the store owners reported September sales figures Thursday, the biggest losers were apparel sellers including Limited Brands Inc. and Gap Inc. Target Corp., J.C. Penney Co., Limited Brands Inc. and Nordstrom Inc. were among those lowering their earnings outlooks.

Wal-Mart Stores Inc. posted a modest sales gain that was slightly below analysts' expectations, but raised its third-quarter profit outlook because of cost-cutting.

"Sales are coming in soft, as expected," said Ken Perkins, president of RetailMetrics LLC, a research company in Swampscott, Mass. "It was a perfect storm, a combination of abnormally warm weather, high food and energy prices, a continued sluggish housing marketing and tight credit."

DO YOUR CHRISTMAS SHOPPING EARLY, BEFORE WE HAVE TO DROP PRICES!

Perkins added that if sales don't pick up, stores will be forced to slash prices to get rid of inventory and make room for holiday merchandise that will start to flow into stores this month. Weak sales are already contributing to the lowered earnings projections.

BAH, HUMBUG. NO, SERIOUSLY. BAH, HUMBUG.

A post on the housing and finance site “Calculated Risk” contains a graph showing that September 2007 (and the prior fiscal year) sales and use tax revenues were down 7% from the prior year. In September of 2006 total receipts were $2,201,717,000. In September 2007, that figure slipped to $2,038,416,000.

Still big numbers. Who said government could drown in a bathtub? California takes in enough money to have its own Navy.

These figures by themselves do not confirm that California is in a recession, because the measure of a recession is actual shrinkage in the gross domestic product (for California). But these receipts are a good proxy for economic activity and bear watching.

AIN’T THINGS BEEN GOOD IN THE DESERT OF THE REAL!