Going back to 1992 when such recordkeeping began, wholesale sales have never dropped as much in any July as they did this year, in dollars or percent. The seasonal adjustment to a mere 0.4 percent drop is hardly credible.
If there’s a “saving grace” to this, it’s that July only had 20 Monday-Friday non-holiday business days, while June had 22. But retailers usually accept shipments from wholesalers six days a week, so I would think that there’s less to that comparison than meets the eye.
Longer-term, January-July 2016 sales are running very slightly below 2012, and miles below the three years in between. How can an economy generating wholesale sales worse than 4 years ago be genuinely growing?
August’s numbers, and any revisions to July, will be crucial.
Also to be clear, the third quarter may not go negative because the government uses the seasonally adjusted numbers. But on substance, another month or two of what we saw in July will mean that 30 percent of the economy is in a genuine downturn.