WASHINGTON (PNN) - July 14, 2010 - Retail sales fell in June for the second straight month, more evidence that there is no economic recovery despite what the propagandists say.

Spending on retail goods dropped 0.5% in June, the Commerce Department reported Wednesday. That followed a 1.1% fall in May. Excluding autos, spending was down 0.1% in June.

Pulling down the overall June figures was a drop in auto sales and declining gas prices. When taking those out, sales would have risen 0.1% for the month.

Separately, the Commerce Department said that business inventories rose 0.1% in May. But sales dropped 0.9%, the first decline since March 2009.

Amerikans are spending less and that could threaten the pace of any recovery. Consumer spending accounts for 70% of economic activity; but consumers have held back because of high unemployment and other signs that have dampened their confidence, such as the volatile stock market and a struggling housing market.

"June's retail sales figures add to the growing batch of evidence suggesting that the economic recovery shifted into a lower gear towards the end of the second quarter," Paul Dales, U.S. economist at Capital Economics, wrote in a research note. "Activity at the end of the quarter was much weaker than at the beginning."