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Thread: Start of a recession ?

  1. #1
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    Default Start of a recession ?

    We do hear how great the economy is doing. All those new jobs posted each month. The unemployment rate has been dropping for 9 years straight. Not just the last two years as some might think. There are many ways to determine the overall health of the economy. One of them is trucking capacity ( which is increasing ) and freight rates ( which are sinking lower ) that tells us manufacturers and suppliers aren't selling and shipping product.

    Truckers' fears have soared to recession-level highs
    While indicators suggest the overall economy is healthy, truckers like Christopher Powell have seen their pay hit the skids.
    Powell's gross earnings have tanked from $6,000 to $7,000 per week to $3,500 to $5,000 — and that's before he has to pay out for repairs, maintenance, and other business expenses. "I don't know how long I can stay in business if things don't pick up," Powell told Business Insider.
    Freight rates have dipped year over year for six months straight. Loads on the spot market, in which retailers and manufacturers buy trucking capacity as they need it, rather than through a contract, fell by 50.3% in June year over year.
    Freight rates have dipped year over year for six months straight. Loads on the spot market, in which retailers and manufacturers buy trucking capacity as they need it, rather than through a contract, fell by 50.3% in June year over year.
    But capacity, meaning the number of trucks available to move loads, was up by 29.9% in June year over year. A particularly profitable year for truckers was 2018, and it encouraged lots of companies to buy more trucks and hire more drivers. Companies ordered so many new trucks last year that, by January, there was still an eight-month-long backlog of new truck orders.
    Now that business has shrunk again, companies are dealing with a glut of capacity.
    https://www.businessinsider.com/truc...stanley-2019-7

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    Default Re: Start of a recession ?

    More fear of a possible recession looming.

    CEO of railroad giant CSX says the economy is the ‘most puzzling’ he’s seen as stock plummets
    The CEO of giant East Coast railroad operator CSX is sounding alarm on the U.S. economy as it weighs on the company’s shipping volumes.
    “Both global and U.S. economic conditions have been unusual this year, to say the least, and have impacted our volumes. You see it every week in our reported carloads,” Chief Executive James Foote said on a conference call Tuesday after the earnings report. “The present economic backdrop is one of the most puzzling I have experienced in my career.”
    CSX said it expects revenue to fall as much as 2% in 2019, well below a previous forecast of an increase of 1% to 2%.
    But like other big transports, CSX is starting to feel the pain from the ongoing trade war between the U.S. and China.
    “Obviously, what would help in the back half would be a resolution or clarity on trade tariffs ... but that is obviously beyond our control,” Wallace said.
    https://www.cnbc.com/2019/07/17/ceo-...-plummets.html
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    Default Re: Start of a recession ?

    Who said the economy is doing great ...
    My guess is the Faux news pundits and those that worship the golden man child.

    Thousands of truck drivers have lost their jobs this year in the trucking 'bloodbath.' Here's what's behind the slowdown in the $800 billion industry
    It's not just truck drivers who are struggling. Major trucking companies have consistently missed and had to revise their earnings targets this year. (Although, on a positive note, J.B. Hunt, one of the industry's pathfinders, announced better-than-expected earnings last week. The announcement led to a rally in trucking stocks, and Cowen's Jason Seidl called it a "glimmer of hope" in an analyst note.)
    But others expect the hard times to keep coming. Morgan Stanley's Ravi Shanker told investors that the bank's transportation team expected second-quarter earnings, which come out in July and early August, to be "poor." Morgan Stanley cut its estimates across the trucking sector by 4%.
    The leading explanation for why trucking is in a slump right now goes back to that central tenet of economics — supply and demand.

    Larger economic trends — like increased factory, retail, or construction activity — push up the demand for truck drivers.
    Less demand, less jobs, less manufacturing, equals job losses in an economy that's in a down turn.

    https://www.businessinsider.com/why-...n-the-market-1
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    Default Re: Start of a recession ?

    More reports of a slowing economy. Large machinery makers have reported lower sales and lower earnings.

    Machinery Makers Have Unpleasant News About the Economy
    The conglomerate Eaton (ticker: ETN), which makes truck parts and electrical products; AGCO (AGCO), a tractor company; the  engine giant Cummins (CMI); and Terex (TEX), a crane manufacturer, all reported numbers on Monday evening and Tuesday morning. And Caterpillar (CAT), the largest machinery maker,  turned in its results last week.
    Those five companies’ aggregate sales fell short of Wall Street’s forecasts by 1.3%, while earnings were 4.1% lower. Three of the five reduced their financial forecasts for the full year because business trends don’t look as good as they used to.
    Demand for industrial goods is weak as well. Sales of hydraulic equipment—used for lifting and towing heavy objects—faltered at Eaton. Aerial work platforms, for building and maintaining tall structures, struggled at Terex. And oil- and gas-related sales were weak at Cummins and Caterpillar. (AGCO, though, reported relatively strong sales.)
    That means that many industrial end markets are slowing down. It isn’t good news, but it shouldn’t be a surprise. Global growth in manufacturing has been losing steam since December 2017, while automotive and energy markets are weak.
    https://www.barrons.com/articles/bey...ge-51564492601
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    Default Re: Start of a recession ?

    Some of us have said it before. The economy is running on smoke from the illusionists hands.
    Normally after a big sell-off, like yesterday, the buyers come out of the woodwork. Not so today.
    Invest wisely.

    Dow plummets 800 points on worsening global recession fears
    Stocks and oil prices plummeted Wednesday, with the Dow Jones Industrial tumbling 800 points -- the fourth largest daily point drop on record and the worst this year -- as increasing global recession fears drove Wall Street investors to the safety of U.S. government debt.
    The yield, or interest rate, of the Treasury’s 2-year note exceeded the yield on the 10-year Treasury, an ominous signal, known as an inverted yield curve, that a recession is on the way.
    Feeding fears of a global recession was a report that Chinese industrial production was climbing at its weakest rate in 17 years and Germany’s economy -- Europe’s strongest -- was actually shrinking.
    https://www.foxbusiness.com/markets/...ks-aug-14-2019
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    Default Re: Start of a recession ?

    Wasn't the catch all wording that manufacturing would come back ?
    Couple that with the newly released annual job numbers. See the next post for that info.

    Manufacturing sector contracts for the first time in nearly a decade
    U.S. manufacturer growth slowed to the lowest level in almost 10 years in August, the latest sign that the trade war may be exacerbating the economic slowdown.
    The U.S. manufacturing PMI (purchasing managers’ index) was 49.9 in August, down from 50.4 in July and below the neutral 50.0 threshold for the first time since September 2009, according to IHS Markit.
    Any reading below 50 signals a contraction. The survey is an initial reading for the month of August. The final figure will be released Sept. 3.
    “Manufacturing companies continued to feel the impact of slowing global economic conditions,” Tim Moore, economics associate director at Markit, said in a statement Thursday. “August’s survey data provides a clear signal that economic growth has continued to soften in the third quarter.”
    But this fresh survey showed new orders received by manufacturers dropped the most in 10 years, while the data also showed export sales tanked to the lowest level since August 2009.
    https://www.cnbc.com/2019/08/22/manu...hs-markit.html

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    Default Re: Start of a recession ?

    Job creation was lower then actually reported. 501,000 jobs less then reported ... and they used to say other administrations cooked the books.

    U.S. created 501,000 fewer jobs since 2018 than previously reported, new figures show
    Turns out hiring wasn’t nearly as strong in 2018 and early 2019 as the government initially reported — by about a half-million jobs.
    The economy had about 501,000 fewer jobs as of March 2019 than the Bureau of Labor Statistics initially calculated in its survey of business establishments. That’s the largest revision since the waning stages of the Great Recession in 2009.

    The newly revised figures indicate the economy didn’t get a huge boost last year from President Trump’s tax cuts and higher federal spending.
    https://www.marketwatch.com/story/us...how-2019-08-21

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    Default Re: Start of a recession ?

    I'll let the story speak for itself.

    Consumers Are At Tipping Point, So Prepare For Bear Stock Market And Recession
    Analysts had expected August to be steady-as-she-goes, but the mid-month preliminary results dramatically shook those expectations. Analysts, trusting those early readings, dropped their forecasts accordingly. However, the final results reported Friday, August 30, are even below those revisions.The Consumer Sentiment Index posted its largest monthly decline in August 2019 (-8.6 points) since December 2012 (-9.8 points), according to the University of Michigan Surveys of Consumers.
    “The recent decline is due to negative references to tariffs, which were spontaneously mentioned by one-in-three consumers, he said. … Trump’s tariff policies have been subject to repeated reversals amid threats of higher future tariffs.
    “Such tactics may have some merit in negotiations with China but act to increase uncertainty and diminish consumer spending at home, Curtin said. Unlike the repeated tariff reversals, negative trends in consumer sentiment cannot be easily reversed.”
    President Trump’s 19-month, on-again/off-again tariff-tweet tactics seem to have finally hit the ad nauseam point. The rapid succession of tweets shifting between harsh criticism and promising agreement, punitive tariffs and favorable reversals has burnt out optimism and, perhaps, even trust. As a result, that rhetorical seesaw now is producing confusion, uncertainty and worry, even among consumers.
    https://www.forbes.com/sites/johntob.../#5ef7d48227d6
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    Default Re: Start of a recession ?

    The wealthy seem to understand not all is well in the financial world.

    Ultra-wealthy Americans are preparing for an impending recession
    A majority of ultra-wealthy families are stockpiling cash to prepare for a recession, which they believe could hit the U.S. by 2020.
    That’s according to the UBS Global Family Office Report, which found that 55 percent of wealthy families — worth an average of $1.2 billion — think the U.S. will slide into a recession within one year. About 45 percent of respondents said they’re boosting their cash reserves in case of an impending economic slowdown, while 45 percent are shifting their investment strategies to mitigate risk.
    “We are very cautious,” a survey respondent, who’s managing a multi-family office in North America, said. “Even now with the market we don’t feel very comfortable.”
    https://www.foxbusiness.com/economy/...ding-recession
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