EVERYTHING IS GOING SWIMMINGLY: WSJ: Get ready for a new wage-price spiral as retail sales fall.

Consider this a confirmation of similar data from the Census Bureau two weeks ago. Retail sales retreated in December when the holiday season should have provided a boost to retailers, according to a Bureau of Economic Analysis report this morning. While nominal wages rose last month, inflation actually reduced worker buying power as expressed in real DPI. . . .

Inflation is eroding buying power even accounting for wage gains, a point that Joe Biden keeps avoiding while touting the nominal numbers. Keep this in mind, because we will come back to it in a moment.

This comes after a better-than expected Q4 advance report yesterday, but even that showed some signs of creakiness. Consumer spending was tepid at best in the final two quarters of the year, and final sales of domestic product nearly at a flatline. Reuters sees this new data as a signal that economic growth may have slowed down coming into 2022, too.

It’s only a “return to normalcy” if you consider the Carter years normal.