The excellent blog CalculatedRiskBlog has several great posts today analyzing the fresh economic reports from the government covering retail sales and unemployment.

A common theme among economic observers is that housing, traditionally a leader of economic growth, is not going to spark the end of this recession, and a greater burden will fall on personal consumption. From that perspective, the retail spending numbers become even more significant.

The retail sales report was relatively encouraging in light of the recent curtailing of consumer spending.

The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for February, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $346.8 billion, a decrease of 0.1 percent (±0.5%)* from the previous month and 8.6 percent (±0.7%) below February 2008. Total sales for the December 2008 through February 2009 period were down 9.4 percent (±0.5%) from the same period a year ago. The December 2008 to January 2009 percent change was revised from +1.0 percent (±0.5%) to +1.8 percent (±0.2%).

Heartening.

But sometimes perspective gives you everything you need to know. The blog includes a chart looking at the trend of real retail sales over the past 18 years.

real retail salesj.jpg

The trajectory of consumer spending has been declining for a full year, shifting from modest savings to dramatic contraction in the second half of the year. At the current level of spend, roughly $480 billion dollars of annual real retail spending has been eliminated from the system — if you assume approximately 1/4 of the retail cost of goods represents profit for the supply chain, that’s $96 billion of profit eliminated.

That’s a pretty major reset.