dinsdag 14 januari 2014

Retail Sales Vs. Disposable Personal Income Per Capita

When people have a low disposable personal income (income after taxes) (green chart), they will not go out and buy things. Retail sales (blue chart) will therefore drop. You can also think of it like this. When taxes go up, people have less savings, less disposable income and can't buy much as a result.

Retail sales need to take into account the inflation rate, so the real retail sales numbers (blue line) are typically lower inflation adjusted.

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