Consumer spending on necessities vs. discretionary goods signals mid-cycle turn
By: New_Deal_democratBack in 2012, I noted that early in economic expansions, YoY real retail sales growth far outstrips YoY PCE growth. As the economy wanes into contraction, YoY real retail sales grow less and ultimately contract more than YoY PCE's. You can see that by noting that retail sales minus PCE's are always negative BEFORE the economy ever tips into recession. Read more
