This week’s economic data is not screaming collapse, but it is flashing warning signs.

Retail sales dropped sharply in July, showing that consumers are finally pulling back after months of using debt, savings, and paycheck juggling to keep spending alive. The weakness showed up exactly where you’d expect: furniture, electronics, clothing, hobbies, restaurants, and other discretionary categories.

At the same time, consumer sentiment fell near historically ugly levels. Households are not just spending less—they’re losing confidence that their income can keep up with inflation.

And while Main Street is tightening belts, Treasury quietly doubled its long-end bond buyback operations. It is technically not QE, but it still matters because Treasury is stepping in to support liquidity in the 10-year to 30-year bond market and help keep  ...