Heavy rains caused unprecedented delays in planting this year and contributed to record floods across the central United States.Agricultureread more
Although Cook did not mention companies by name, his commencement speech in Silicon Valley's backyard mentioned data breaches, privacy violations, and even made reference to...Technologyread more
U.S. ambassador to Israel David Friedman called the gesture a "birthday present" to Trump, who turned 73 on Friday.Politicsread more
Organizers claimed that nearly 2 million Hong Kong protesters took to the streets Sunday in a rally to demand the city's top official resign a day after she suspended — but...China Politicsread more
Target's registers were down on Saturday for several hours preventing customers from checking out.Retailread more
In the survey, 66% of Democratic primary voters say they'd be enthusiastic or comfortable about Biden as their nominee to take on President Trump in the 2020 election. Just...Politicsread more
The newspaper wrote that Goldman's executive are hoping CEO David Solomon's changes to a firm that historically thrived in investment banking and trading will boost its...US Marketsread more
The Fed is not likely to make a move on interest rates when it meets next week, but it should clear the way for a rate cut later in the summer.Market Insiderread more
Representatives from the Chinese side say they think it likely that Chinese President Xi Jinping will attend the G-20 meeting later this month. But in order to reach a trade...China Economyread more
With uncertainty keeping a lid on U.S. stocks, Ed Clissold of Ned Davis Research says the rest of 2019 is likely to be a "choppy," but somewhat opportunistic, ride for...Futures Nowread more
You can save money by doing a quick check and unsubscribing from apps you no longer use.Technologyread more
There's good news and bad news about trucking these days.
The good news is traffic is up! A good sign for the economy! (OK, there's a caveat, but more on that in a minute).
The bad news? That the good news may lead to an economic headwind you weren't expecting.
Is this good news/bad news important? You betcha. After all, trucks manage about 70 percent of the nation's commerce. Face it, if you bought it at a store, it probably got there on a truck. So pay attention.
"Trucking stats are often used as a gauge (one of many) on the health of the economy," pointed out Greg McBride, senior economist for Bankrate.com. "All in all, an increase in tonnage is reflective of increased demand, and that is a positive economic indicator."
The Good News ...
The tonnage of truck freight increased by 1.4 percent in the last month, according to the American Trucking Associations, reversing 0.6 percent fall in July. It was the largest pop since May and kept up a forward trend for three of the last four months.
OK, here's the caveat. It's freight as measured by weight. And it turns out the sectors giving trucks the most business right now—housing, automobiles and fracking—move a lot of heavy stuff. If you just count individual truckloads, it's not much of a gain. In fact, it's pretty flat.
And since a truckload of bricks, while weighing more, costs a lot less than a truckload of lightbulbs, it might not be saying that much about the economy. But then again, low end stuff moving now may mean high end stuff will move later. You got to build the house before installing the light bulbs. And at least the trucking trend is moving in the right direction.
"The significance of these numbers isn't the August increase—because July was down after all—but the fact that it has been up in three of the past four months," McBride said in an email response to questions. "The takeaway is positive."
(For those of you who like cross-checking data, railroads seem to be seeing a slight uptick as well).
The Bad News ...
There may be a shortage of trucks to carry the freight an improving economy produces. That's the warning from an economist for the trucking group.
"We are headed for a capacity problem," Bob Costello, chief economist for the American Trucking Associations, said at a recent conference. "The industry is not adding much capacity today."
Indeed, during the latest economic doldrums, truckers did not make it a priority to add new equipment to fleets. In fact, they reconfigured equipment to do other work (like turning a dry-good hauling truck into a tank truck for the fracking business) or selling used trucks to overseas buyers, according to Costello.
(Related: Deadliest Jobs)
On top of that, productivity is down, Costello said. Truckers are having trouble keeping qualified drivers because of competition from construction and energy outfits looking for heavy equipment operators. In addition, new government regulations about hours of service and new electronic logging procedures (which take time to learn) eat into the time drivers can be on the road, he suggested.
Obviously a lack of trucks could pose a problem for a recovering economy. if goods aren't moving to where people can buy them, well, they don't get bought.
Until, of course, economics kicks in—like higher wages for drivers and higher rates for trucks.
"I'm not suggesting fruits and veggies will rot," Costello said in an email response to questions. "But when the crunch happens, the pendulum will move towards carriers. As rates then go up, it will be a little easier to increase capacity."
Of course, those increased transportation costs get moved to the companies using those trucks and their customers. Transportation, however, usually makes up a very small percentage of the overall price of most goods.
Still, it's a cost that wasn't there before.