What everyone’s missing behind the retail slowdown.
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00:00So retail sales have been at historic highs, and I think that that is something that we don't fully always talk about is that retail sales, even inflation adjusted, overall retail, e-commerce, almost every sector has been growing for the last 25 years and even through the pandemic.
00:22So if we see a slight drop off, it is not yet a reason to be alarmed.
00:30I think that if there were a consistent set of several months of the same story of any type of softness or negativity, then I think that it would be a reason to be concerned.
00:41But numbers were actually quite strong even through March.
00:46So I need to see at least another probably few months of data that shows some consistently negative numbers to really believe that we may be headed toward a retail downturn.
01:00Any numbers that we see now in retail are absolutely going to be impacted by tariff news, but there is still a lot that is unclear because there are, in fact, a lot of containers still coming over.
01:18There is a lot of merchandise that hasn't been shipped over yet.
01:21A lot of what we saw in March and April that was a retail-related spike, for instance, in sales was largely due to people front-loading.
01:36It would either be consumers front-loading transactions or retailers trying to bring things in before prices increased even further.
01:46So that's generally what we were seeing.
01:48The actual impact of the tariffs themselves, where there may be anywhere from a 10 to, depending on where you're importing from, 100% plus tariff on that imported item, that has not yet been borne by very many importers yet.
02:11So that hasn't flowed through consumer pricing.
02:16It hasn't flowed through the rest of the supply chain.
02:20And if that does happen, and there's still a chance that we end up with a 10% tariff and that's it, if we still end up with heavier tariffs, we probably aren't going to see that until the summer at the earliest because we keep getting moratoriums on those tariffs.
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