By Tyler Durden at ZeroHedge
Worst.Case.Scenario. In 24 years, the ratio of wholesale inventories to sales has only been higher than the current 1.35x once – at the peak of the recession in the last financial crisis. Wholesale sales tumbled 1.3% MoM (worse than the -0.3% exp) and inventories rose 0.3% MoM while expectations were for a drop of 0.1% (inventories over sales difference rose from $143.6BN to $151.2BN in one month, a new record high.) And finally, automotive inventories rose to 1.78x sales – the highest since the crisis.
Keep stacking, despite tumbling sales…
Which leaves us firmly in the “recession imminent” section of the business cycle…
And there has never been a wider absolute spread between inventories and sales…
And as far as the automotive sector – that bubble may have a problem…
This cannot end well.
Source: Wholesale Trade “Gap” Reaches Record High as Sales Tumble, Inventories Rise – ZeroHedge
