The Import Slowdown: Los Angeles Area Ports
Submitted by
CalculatedRisk on Tue, 04/08/2008 - 8:45am (89 comments)
Shopping at Amazon?
Wait! If you click on the Amazon banner link at the top of the page first, HCN will get a percentage of anything you purchase for 24 hours!
Open predictions
Our local book authors
User login
Who's online
There are currently 19 members and 191 guests online.
Recent Recommendations
--
"The ex-petroleum deficit is falling fairly rapidly, almost entirely because of weak imports (export growth is still strong)."
All due to weak (negative) "aggregate demand." We have been in recession since November 2007.
Jas
There are also mothballed cars on Union Pacific lines. Hundreds (thousands?) of cars have been parked on sidings and unused lines in Northern Nevada/California for more than a year. Appears to be mostly lumber cars and boxcars.
If we are facing a recession of truly global proportions, with economic contractions even in places like India and China, then I think all bets are off as to how severe this downturn might get.
Too many assumptions currently expect the USA to take a hit while most of the world chugs along on it's own steam, relatively unscathed. But if there is no economy to pick up the slack, what then?
MOM usually watches the transportation data. I wonder if she has seen anything similar in the larger ports data or trucking data?
Worth noting that the upcoming months of data were also affected by the annual CNY shutdown and the worst winter in China in decades. I would expect a serious cliff dive through March.
just sayi
I am feeling a sense of relief that we are becoming more indebted to oil exporting dictators than to aspiring commercialists.
XTRA Lease trailers need storage lots from cleveland , to fontana to ft worth
Fuel costs for transportation are probably causing some of this, or at least seriously affecting the low margin goods and producers.
Over-the-road truckers were protesting recently about the high price of diesel. There was also that Bloomberg article on Dole having profitability troubles and looking to sell land it owns in Hawaii and California that other's have posted up here recently. It had a side reference referring to one of the factors Dole is facing is the cost of bunker fuel for their ships has gone up significantly.
Dole owner Murdoch is one of the largest landowners in my county, he also owns a large homebuilder - I think his status on the Forbes list my be in question?
The loaded containers graph (1st graph) tells a very interesting story I believe. For the inbound containers (imports), I'm seeing that the 2007/2008 annual cycle data show a reversal from higher highs to the beginning of lower highs and lower lows. And the nature of the 2008 low to date is different than those of the recent past...started earlier and has been in continuous decline. Should be important to watch this one evolve over the next year or two. To me, this is a great picture of global economic rebalancing in action.
I posted this yesterday night. It amplifies the story.
Idle cars signal a downturn
The nation's top hauler of container rail freight, BNSF Railway Co., is parking miles of rail cars in Montana and elsewhere because there isn't enough freight to keep them rolling.
Cars that often carry 40-foot containers of goods shipped from Asia stand like an iron fence between the Missouri River and this Montana burg known for world-class fly fishing. They stretch as far as Sandee Cardinal can see when she stands outside her home on the river's west bank between Helena and Great Falls.
"What is that but a symbol of how America is down in the dumps right now?" Cardinal asked as she gazed at the cars that haven't moved for about three months.
Interesting to note the type of rail cars that are parked. There is an acute shortage of other rail car types, e.g., coal cars in the north-east BC coal fields.
Staring at the cars isn't helping matters Sandee - get out there and do some shopping for God's sake
CR:
Seriously, I'm impressed by the breadth of what you look at and how it relates. #1 certainly tells the story of the national frat party that's been going on; we just have to keep the bottom line upwards bound.
Wow.
I swear that just a few weeks ago, one of CR's regulars posted data that indicated service on the freight lines was way up. Anyone else remember this? I don't even know which thread to look for the comment.
Local anecdote: I was in the bank yesterday and had the misfortune of overhearing a bank manager tell a man his application for a loan was rejected. (Sorry, I don't know what kind of loan). He was trying to sound calm but I could hear the panic in his voice...whatever his financial problems, I just knew he was in way way way over his head.
Back to lurking mode...
So if our trade deficit with Asia is going down, that means less dollars for them to neutralize by buying American securities, which means less overseas investment in the US, just at the time when so many of our companies are trying desperately to raise capital. If the trade deficit continues to decline, does it ultimately lead to higher interest rates and lower securities prices?
The unwinding of the global financial perpetual motion machine continues...
Considering how many of China's manufacturing towns are set up, with huge towns producing a single kind of goods, they could be in for a world of hurt as exports decline. And with rice prices up, it's going to get really ugly for them...
What too few are looking at is that U.S. exports are bound to slow down as well. In large part, the improvement in the trade deficit happened because of the lag in the slowdown in Europe and Asian countries.
Europe is now sharply on its way to reality and I don't think Asia is that far away.
Watch U.S. aircraft exports in particular slow down dramatically soon.
Train wreck.
RE, yes, I agree. As the rest of the global economy slows - due to slower exports to the U.S. - then U.S. export growth will slow too.
What would really help is a sharp decline in petroleum prices. Not saying it will happen - but it sure would make a difference.
Best Wishes.
Recently exports have picked up (because of the weak dollar), and for the last two months imports have increased an average of 24.3% year-over-year. - CR
Is that right? Or are we mixing our exports & imports?
It looks like the trade deficit has reached approximate equilibrium. However, its components have dramatically shifted, with dollar cost of oil imports rising and everything else falling, percentage wise.
Is this an indirect indication that the US consumer is tapped out, and increased cost in one area reduces consumption in another by equal measure?
i heard the european facing ports were pumping though?
What would really help is a sharp decline in petroleum prices. Not saying it will happen - but it sure would make a difference.
Best Wishes.
Calculated Risk | Homepage | 04.08.08 - 1:56 pm | #
Unfortunately this won't happen soon.
The oil prices are high due to the tanking dollar. It is tanking due to loose monetary policy related to the mortgage fiasco.
I hope all those bonuses were worth it guys.
"I hope all those bonuses were worth it guys."
I think they are too busy playing on their yatchs to respond today.
Watch U.S. aircraft exports in particular slow down dramatically soon.
Nope, the falling dollar and rising fuel prices will make the new more efficient aircraft a wicked bargain, Likely to be one of the few bright spots for the next six months.
w writes:
I am feeling a sense of relief that we are becoming more indebted to oil exporting dictators than to aspiring commercialists.
w | 04.08.08 - 1:30 pm | #
Tibetans probably don't consider the 'aspiring commercialists' a better lot.
Also - you don't like to see oil exporting dictators get rich? Use less oil.
MaxedOutMama might have been the person you were remembering FT Woods. She comments here frequently and does some serious number crunching of her own. I was just over at her blog checking and she had a post in late March on the durable goods orders, trucking and rail traffic which, while bad, seemed to indicate an uptick in manufacturing activity for the US.
MaxedOutMama: Headlines Bad, But....
Hopefully she'll see this thread and chime in with what she's seen.
Food and oil will remain dear...and I don't mean like your aunt...for years.
Of course, in the long run, I expect Malthus will be proven wrong once again.
Of course, according to Keynes, the long run prospects for us all remain dim.
Hey, What ever happened to Stagflationary Mark? He used to post this info and had some pretty interesting commentary.
CR,
You know that I have been a bull on oil for many years (SI). Despite the global slowdown, I don't see oil prices decline very much except temporarily.
China is starting to build its strategic reserve and given the geopolitical issues, I don't expect that to slow down. Stress in agriculture will put even more strain on petroleum product demands.
In addition, the recent UBS study is great mainstream evidence for the difficulty that oil companies have in replacing declining fields. It is about to get very interesting and as I mentioned recently, I expect higher average oil prices despite the economic headwinds.
"uptick in manufacturing activity"
Which is what? What does the US manufacture anymore in a worldly significant manner? Airplanes and cars are about I can really think of. Semiconductors are elsewhere as well as just about everything else. Homebuilding and CRE are our last big manufacturing jobs and they are/will be crushed for several years.
OT here, & I'll go back to WaMu,
But IMHO, the one-cent "thing", the div is probably about ownership rules and control; regulations for banking, which we saw with bears, i.e, the div was crashed in relation to to WAMU insolvency issues. Thus Wamu didnt go the Bear route by becoming an acquisition/take over. By playing games with ownership Wamu re,ains a regulated bank and thus lets a private owner take over managing. This is also like SWFs taking limited outside control .
A theory, just an idea, but that's my take before lunch... and it's worth every penny...
If I had billions of barrels of oil under my property and had no immediate need for funds, I would just hoard the oil. Why exchange it for depreciating dollars & puny interest rates on treasuries?
I think Saudi Arabia and other petroleum countries have enough $ for the time being.
As for most Americans, they have neither $ nor oil.
Son "Dad, I think I'm going to grow up and manufacture things."
Dad "Great son. What are you going to make?"
Son"I'm going to manufacture economic data just like the gov't does, but more efficiently and even more unbelievably."
Dad "That's the American way. I'm proud of you, boy."
Linens 'N Things Reportedly Being Pushed Towards Bankruptcy
4/8/2008 10:40:11 AM Linens ‘N Things is being pushed towards bankruptcy, according to a report from the New York Post in its online edition Tuesday. The Post reports that billionaire financier Leon Black is looking to cut his losses and unload the struggling retailer.
The Post, citing unnamed sources, said that Black's buyout firm Apollo Management is looking into the possibility of a “prepackaged” bankruptcy. Black's firm took the home goods retailer private in 2005 for $1.3 billion. In a “prepackaged” bankruptcy, Black's firm would settle on a restructuring plan with creditors before filing for Chapter 11.
The newspaper cited sources saying that Apollo has “been aggressively buying Linens 'N Things debt in a bid to exert greater control over any potential restructuring, in which creditors would likely exchange debt holdings for equity in the reorganized company.”
http://www.rttnews.com/apps/deskalert/article.asp?date=04/08/2008&item=758
Rob,
I agree that the new planes have significantly improved fuel efficiency. However, I believe that Chinese and other Asian purchases of Boeings will go down significantly as their economy slows.
Even established airlines are under tremendous cost pressures which I believe will contribute to the slowdown in acquisitions because of cash flow issues despite the fuel economy improvements of the new planes. We will see.
I'm not certain that the loaded outbound increase since 1/06 is necessarily manufactured goods. Lots of food and scrap export. If I remember correctly, scrap export started picking up steam a few years ago.
Cheers,
Which is what? What does the US manufacture anymore in a worldly significant manner?
I makes a ton of stuff - you just won't see any of it at WalMart or Best Buy - very little consumer hard goods or electronics.
But everything you use everyday - electrical, nat gas, gasoline, food, roads you drive on - etc. Most all of the equipment, capital & infrastructure behind all that consumption is produced in the US. That stuff lasts a long time but still wears out - it is colossally expensive & profitable business.
When the dollar was strong there was huge incentive to start 'parting out' production of components to Asia... I fact there was a big push to start moving the plants over there too. Both trends have slowed to a crawl.
It still makes sense to build locomotive engines in China that will be used in China... but for a while it made sense to build them in China to ship back here. That no longer makes sense (though I would argue it never did - currency distortion isn't 'sensical').
This report is by no means bad news - unless you are the type of person that likes more free lunch. We've been on a consumption free lunch for a generation.
The PE guys are looking dumber every day...
CR, on those charts with clear fixed frequency noise, would it be possible to throw in a simple moving average that eliminates the noise.
You know, 12 period MA for monthly, 4 period for quarterly - I think the underlying trend and turns would be more visible (with a lag of course).
Just a suggestion. TIA.
Softening oil prices would be nice...but I think that OPEC likes prices exactly were they are. They will defend these levels....even as the world burns. They are concerned about their supplies...and will constrain production to support the high prices.
First we report CPI excluding food and energy--now we report ex-petroleum deficits. Gimme a break.
Idle Rail Cars - This is a bit iffy as an indicator simply because some railways have been binge buying new cars over the last 5 years. Huge swings in available capacity all around.
I have at least 8 Home Depots & 2 Lowes within a twenty mile radius of my town. They are always empty, even on weekends. Two years ago they were bustling.
Imports are going to take a serious hit, excluding oil. Decoupling = contained.
I remember correctly, scrap export started picking up steam a few years ago.
Still is happenin'... but our metal work industry is now fighting for the stuff too - everywhere is hungry for metal right now & scrap is where a lot of it starts. Primary metal is so damned expensive it makes steel seem 'precious'.
They've even started expanding the mines in N Minnesota 'Iron Range'... I think the last time that happened we were also at war... in Viet Nam.
One more thing before I go change the world for a couple of hours:
Can the US just vomit out its excesses of the last 7 years and get back to normal quickly? Ever try to throw up 4 million excess houses draining the finacial system? It's trying its hardest, but, in the end, it will not be able to and, as a result, will have to suffer through a multi-year, brain-splitting hangover. Remember, though, if you prepare for the pain, it doesn't hurt as much.
Scotty, thinking doesn't suit you.
1 penny divy keeps institutional investors in for the moment so share price doesn't plummet while they can have another Q of fundraising. Share price goes to reserve ratios, so stabilizing is job one. while trying to find a buyer
KP,
"but I think that OPEC likes prices exactly were they are."
OPEC isn't setting the price. Hedge Funds piling hot money into commodities are.
Cheers,
Linens 'N Things Reportedly Being Pushed Towards Bankruptcy
In our family we refer to Linens-N-Things as 'More Stuff To Dust'. Each one of those stores is a dozen or so containers of Chinese crap...
Source: http://jc-ali.jctrans.com/jcnet/news/osn/2008311611430.shtml
Interesting, the web page is in English or Chinese.
Europe is generating port traffic with exports from the US. CA has a drop - interesting that home furnishings made such a significant contribution to West Coast port numbers.
Snips from the Ports of the Gulf and East
On the Gulf Coast, the Port of Houston reported a 14 percent slump in containerised imports in January versus December, but a two percent uptick versus a year ago, according to statistics provided by the port. Containerised exports were flat in January versus December, but 16 percent stronger than in
January of 2007.
On the East Coast, the Maryland Port of Baltimore showed solid gains in containerised volumes both directions in January versus December, according to port statistics.
In other cargo, roll-on/roll-off equipment, like tractors, showed particular strength in January versus a year ago, said Ben Lieberman, manager of the ports market planning. Imports climbed 37 percent, and exports skyrocketed by 89 percent.
"If you're in Europe, you get a lot of CATs for your dollar,"
Lieberman said, referring to costly Caterpillar equipment. Ro-ro exports gained 37 percent versus December, and imports increased seven percent, he said.
Baltimore's containerised imports and exports fell a few percentage points across all of 2007 versus 2006. And the construction slowdown was felt in non-containerised inbound building materials like gypsum and cement, both of which declined last year, Lieberman said.
The Georgia Port of Savannah extended its recent pattern of healthy increases in inbound and outbound goods movement in January, according to statistics provided by the port. Imports rose about 11 percent in January versus December, and exports increased four percent. Compared with last January,
imports raced 28 percent higher, and exports zoomed nearly 38 percent higher.
The National Retail Federation, a Washington-based trade
association, reported a 3.5 percent drop in inbound containerised volumes across 10 major US ports in January 2008 versus December 2007, and a 4.3 percent decline versus the year-ago month.
Export strength and import weakness played out nationally in 2007, according to PIERS, a leading source of waterborne data. US containerised exports swelled more than 16 percent versus 2006, while inbound volume stagnated, down 0.2 percent. At the Port of New York and New Jersey, containerised exports shot up by more than 20 percent last year versus 2006, while
imports mustered only a 1.5 percent gain, PIERS said.
dryfly,
but our metal work industry is now fighting for the stuff too - everywhere is hungry for metal right now & scrap is where a lot of it starts."
No doubt. My point was that CR states that loaded outbound is evidence of Manufactured exports increasing, and I think other things, like scrap export, which I know have been increasing, can also explain it.
I'll have to see if I can find inflation adjusted man. export numbers.
Cheers,
dryfly - agree. as we need less Chinese crap, places like LnT will go under and take away even more jobs. The dominos are falling...
Alec,
So what, it's a control issue,
INTERESTS IN NONBANKING ORGANIZATIONS
SEC. 4. (a) Except as otherwise provided in this Act, no bank holding company shall--
(1) after the date of enactment of this Act acquire direct or indirect ownership or control of any voting shares of any company which is not a bank, or
blah, blah... (I'm still looking)
voting shares of any company which is not a bank or bank holding company or engage in any activities other than (A) those of banking or of managing or controlling banks and other subsidiaries authorized under this Act or of furnishing services to or performing services for its subsidiaries...
"... OPEC isn't setting the price. Hedge Funds piling hot money into commodities are. ..."
Misean,
I don't think that is much of an issue right now. COTS do tell that story. We are definitely at the lower end with large speculators.
http://www.softwarenorth.net/cot/current/charts/CL.png
Nova,
Nice post, thanks. Answered a question or two of mine.
Cheers,
Misean,
The Middle East oil exporters have huge inflation problems. Increasing production is likely to hurt rather than benefit their economies.
Also, when the Chinese, Japanese & OPEC nations stop recycling $ for treasuries, interest rates will rise. This will blow the doors off of the fed's models.
Bernanke's newest paper - Stagflation, Making Sure it Happens Here Again.
Get off your ass and look yourself:
FDIC: Error 404 - Page Not Found
Funny you mention the port of L.A.
Every television report on that port, bar none, has shown the predominant component of those outbound containers is garbage.
Ship after ship, full of recycled trash, bound for China as a raw material for re-manufacturing.
Not seeing the domestic employment opportunities in creating waste.
While not sure I think Baltimore may be looking flat compared to other East Coast ports because it was a major point of entry for Japanese cars.
No doubt. My point was that CR states that loaded outbound is evidence of Manufactured exports increasing, and I think other things, like scrap export, which I know have been increasing, can also explain it.
I've been saying for a long time - looking at exports in aggregate is the wrong place to look for the effects of 'weak dollar'... exports will pick up but it will be the 'tip of the iceberg'.
Look at 'import substitution' instead... parts & services that were imported to make those Caterpillars mentioned above - many of those are now being resourced domestically. Overall Cat might not export much more (in number of crawlers shipped out) but the domestic content in both mfg & services will be MUCH HIGHER with a weak dollar. Those numbers will be VERY hard to pin down but believe you me - they are real & growing... I know.
Kp,
I think you are probably right.
OPEC afterall did try to defend prices back in the 80's by cutting production from 31 mmbopd to 17 mmbopd.
At that time you had a 6% destruction in demand between 88 and 93, I suppose in part due to an 11x increase in prices between 1973 and 1980.
But what really undid OPEC was huge new production that came on line in Great Britain, Norway, Russia and Mexico.
I see no reason why OPEC wouldn't attempt to defend prices as it did back in the 80's.
This time around Non-OPEC countries may not increase production the way they did back in the 80's, either because they will not or they cannot.
Dryfly,
I used to own a lot of yellow metal including a Cat 992 loader. Monster machine. You literally needed a loan for a new tire.
RE,
Thanks for the chart.
Cheers,
Nonmember Banks
OK, better
Regulatory barriers that prohibit private equity firms or other companies from acquiring more than 25% of a bank have not prohibited banks from raising capital. But regulators might be forced to take a closer look at these policies in the future.
dryfly,
On import substitution...check.
Cheers,
Not seeing the domestic employment opportunities in creating waste.
Markel
I disagree - I have seen numerous news segment on how homeless folks are taking phone cables, cemetary plaques, road signs, et al. and selling them as scrap, to scrap metal dealers. Maybe its not true employment, but its work.
I used to own a lot of yellow metal including a Cat 992 loader. Monster machine. You literally needed a loan for a new tire.
Angry Saver | 04.08.08 - 2:39 pm | #
I used to sell hydraulic manifolds to both 'Green' and 'Gold'... they were raw unassembled cast iron & machined manifolds used in power take offs & transmission (various part numbers)... each about the shape & size of a laptop and the suckers had about $2 worth of metal and $100 plus worth of valued added (machining). They shipped out as clean as if they were medical devices.
100% American made - you could drive by the factory a million times and never know the sophisticated mfg going on in side... companies like that are ramping up as fast as they can.
US mfg has definitely declined - but it is still there - I'm really not ripping the folks who say it is all gone - most just wouldn't know, you almost have to be an 'industrial spy' to recognize it.
I'm sorry, I'm going to have to vote that WaMu noe be called an investment bank and drop its FDIC protection!
For example, certain charter types-including limited—purpose consumer banks and ILCs—permit a mixing of banking and commerce. These charter types do not fit the definition of a bank under the BHCA and technically are not banks; in certain states, they can be owned by commercial firms. These firms, in turn, are not subject to the BHCA and are not required to become bank holding companies.13
And there is other evidence of banks exercising control over commercial firms, and commercial firms exercising control over banks, through various means. Sometimes, as legal restrictions were placed on the mixing of banking and commerce, certain exceptions were made that allowed commercial firms to retain their affiliations with banks. Examples include the limited number of nonbank banks that were grandfathered by the Competitive Equality and Banking Act of 1987 (CEBA), and the unitary thrift holding companies that were grandfathered under the Gramm-Leach-Bliley Act of 1999 (GLB). Sometimes, the mixing has resulted from the equity investments of banks, including investments in small business investment companies, equity acquired in loan workouts and equity kickers, and merchant banking activities. Outside of chartered banking, captive finance companies of large commercial firms (e.g., GE Capital) also approximate a mixing of banking and commerce. Moreover, individuals are permitted to hold a controlling interest in both a bank and a nonbank commercial firm. For example, in the case of chain banking organizations, federal regulatory oversight does not extend to the owner.
dryfly:
appreciate the insights.
thanks
BMW has got to have a big teutonic grin on its face for their Spartanburg, SC factory decisions. They last month annouced another expansion and decision to build all X models there for world consumption.
NJ governor Corzine had this to say last month:
"Corzine, in an interview later today on CNBC, said the U.S. economy may go into a worse recession than many expect because of a decline in consumer spending and higher costs for energy and food. He said port shipments have dropped 15 percent, the state lost 9,000 jobs in January and sales tax collections are dropping"
Corzine Says Revenue Drop May Force Steeper Cuts (Update1) - Bloomberg.com
I remember watching this interview. He actually said the ports of NJ and NY.
you could drive by the factory a million times and never know the sophisticated mfg going on in side
dryfly, one of the most interesting things i got to do in school was a lot of manufacturing tours. i'm a software guy, what do i know from manufacturing? i was amazed at the process, and how much it now differed from what i thought of as heavy manufacturing. you could eat off the floors in most factories...even in a car assembly plant, never mind the local machining operations. At the time i remarked how you'd never guess what they were doing inside. So much is still manufactured here but the larger stuff is sexier and gets more press.
Oh, and my favorite plant was a Caterpillar one outside Grenoble because they let us test drive a couple
The cost of importing aliens is increasing!
Imports will surge temporarily when the tax rebates (or whatever silly name the govnt. has given them) are cashed and spent: we are going to borrow from China so we can buy goods from China, which will stimulate China's economy and increase their ownership of our assets. Brilliant!
dryfly said: "US mfg has definitely declined - but it is still there - I'm really not ripping the folks who say it is all gone - most just wouldn't know, you almost have to be an 'industrial spy' to recognize it."
Or watch documentaries on cable, "How It's Made" or "Modern Marvels.":) I've seen offices dirtier than the factory floors.
S.
Or watch documentaries on cable, "How It's Made" or "Modern Marvels.":) I've seen offices dirtier than the factory floors.
Like mine.
What amazes me is the resource recovery processes. The days when you could tell what color paper the mill was making by looking at the river downstream are long gone. Handheld metal analyzers that can tell 6061 from 7075 for targeted recycling. Reverse osmosis to get back organometallic plating molecules from the baths. Cool stuff.
U.S. INTERNATIONAL TRADE IN GOODS AND SERVICES
January 2008
"In our family we refer to Linens-N-Things as 'More Stuff To Dust'. Each one of those stores is a dozen or so containers of Chinese crap..."
Never been in one. Always afraid one of the "things" would get me.
That said, occasionally I'll find myself in the local Bed, Bath, & Beyond (against my will) and amuse myself by trying to find a product -not- made in China. It's really hard.
US mfg has definitely declined - but it is still there - I'm really not ripping the folks who say it is all gone - most just wouldn't know, you almost have to be an 'industrial spy' to recognize it.
dryfly | 04.08.08 - 2:46 pm | #
Yep,even though I work in a truck shop my floor gets scrubbed and polished every Saturday.
My shop is cleaner than half the trucks I work on.
Chris
"Although this is just two Los Angeles area ports"
Sorry if this has been commented on - but those two ports account for 43% of ALL container imports into the United States, according to the Port of LA.
This week the USC Marshall School has hosted the APBO -Asia Pacific Business Outlook- and issues of import/export are high on the agenda. Check the APBO2008 website for PPT presentations of information presented at the conference.
Andrew, someone sent me down here via the CR vine. What I have so far this year is that retail-related (consumer) truck and rail traffic is down. It was down YoY last year, but this year it's the negative YoY numbers are higher and the difference is accelerating.
However the non consumer stuff is way up, and thus overall volumes have broken their two-year declining pattern.
Rail reports faster than trucking, and March was a bad month for rail. However there were some exceptional factors. If April continues the same pattern, then consumer-related declines in mfrg are for the moment outweighing the insourcing bonus.
It is not just freight. The shipment/inventory ratios for industrials seem hugely improved compared to last year. Also treasury receipts are staying up nicely, and Federal Unemployment Tax reversed its freight correlated roughly two-year decline.
I have a hunch we are about to see another drop down, but no figures on that. And I hope I am wrong.
I have put feelers out through multiple friends of friends, plus checked the county sample. All the data I have seems to show that it's good times for mfrg-related industries as well.
What will happen in China as their export economy slows? Just look at the dramatic decline in the Shanghai index.
I thought calculated risk didn't do stock prices.
I just want to know what the so-called primary metal and fabricated metal exports are?
Are they just scrap metals? How can we be proud of surge of scrap metals? If we are reduced to just raw metal exporter, we are no different from Africa!
The weak dollar causing increased exports is a temporary effect. As soon as the increased price of manufacturing goods and providing services, which a weak dollar also causes, are worked into the system the cost of our products in dollars will increase and wipe out any short term gains. The terrible side effects of the weak dollar will remain, however, much to our detriment.
Thanks for the update MOM, I appreciate the extra effort to enlighten a heathen like me. I have to start watching where you guys get your numbers from so I can crunch my own numbers. I'm not a trained economist, but as an engineer I'm not afraid of numbers or analysis. Time to rework the toolkit.
How does rising exports vs idle rail cars work out? Are rising exports so dwarfed by declining imports that the net effect is a net decline in rail car use (i.e. a net decline in economic activity)?
Who are we exporting to, and will they be able to import on a sustained basis, when perhaps they may be importing largely to process and export finished goods later into a declining US import dynamic? i.e. are exports rising merely as a latency artifact, or is there real demand ready to offset, in total, US consumer demand declines?
Or to look at it another way...the engine can slow down rapidly while the caboose is accelerating...but only for a bit.
Thank you Andrew and MoM.