by Calculated Risk on 9/10/2010 10:07:00 AM

From the Census Bureau:

Total inventories of merchant wholesalers, except manufacturers’ sales branches and offices, after adjustment for seasonal variations but not for price changes, were $405.0 billion at the end of July, up 1.3 percent ...

The July inventories/sales ratio for merchant wholesalers, except manufacturers’ sales branches and offices, based on seasonally adjusted data, was 1.16.

Click on graph for larger image in new window.

Usually we focus on Manufacturers' Inventories and Manufacturers' inventory-to-sales ratio, but the wholesale inventory report shows the same thing - the inventory adjustment is over.

This increase could be spun two ways. First from CNBC:

U.S. wholesale inventories surged by the largest amount in two years in July ... in a sign firms were anticipating enough demand to boost stock this summer.

That sounds like good news.

The alternative view (my view) is that inventories are now a little too high - and that wholesalers will now cut back a little on orders.