Preferred Financial Services reports that retail sales dropped 0.5% in June…

July 22, 2010 - PRLog -- Andover, Massachusetts July 22nd 2010 — Although the headline grabbing 0.5% drop in June might seem to indicate we are heading towards another recession and more bad news, some good points can be taken if the data is analyzed more thoroughly. The commerce department released the retail spending data on Wednesday and the 0.5% drop follows a 1.1% drop in May. However, excluding auto sales, retail spending was only down 0.1%. In fact, if you take out gasoline purchases as well, which declined as gasoline prices dropped, consumer spending actually rose 0.1% in June. Although this data indicates at best flat consumer spending the economy will need to see robust consumer spending growth moving forward if we are to ever emerge out of this semi recession with high unemployment and sluggish industrial output.

Since consumer spending accounts for over 70% of the US economy it is a great indicator of where the economy is heading. Since the economy collapsed in 2008 consumer spending has been cut drastically and the continued slow growth is limiting the economic recovery that could be taking place. However, as auto sales plunged 2.3% in June the data is definitely skewed and is not giving an accurate report on consumer spending. In fact, department store sales rose 1.1% and general merchandise stores (Wal Mart) saw a .2% increase in June. Both of these sectors saw drops in May which indicates to the casual observer that while Americans continue to be hesitant  purchasing big ticket items such as vehicles they are returning to general stores and trying to resume their normal pre recession lives.

Moving forward, if we continue to see sluggish consumer spending growth, expect to see the economy head back towards a recession with dire consequences for the average American. As I have mentioned before, the best way to encourage consumer spending is to make sure that Americans are employed and have money to spend. By creating jobs and installing confidence in the job market, the US economy can recover and continue to move forward.

Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications) and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives). Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past 7 years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

For more information, please visit www.pfsdebtrelief.com or follow us on our blog at www.pfsdebtrelief.com/blog/ .


Contact:
Stephan Tavernini
Marketing Coordinator
Certified IAPDA Debt Arbitrator
Preferred Financial Services
stavernini@pfs1.net


Original Article:
http://finance.yahoo.com/news/Retail-sales-drop-05-percen...

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Preferred Financial Services is the leading voice in the debt settlement industry. PFS has worked with hundreds of creditors to help negotiate realistic goals for those drowning credit card debt.