John’s Blog

11-3-09

Dear Friends,

A number of good economic trends are occurring as the Institute of Supply Management released the news that PMI index showed business activity up by 3.1% to a reading of 55.7%. This last occurred in April of 2006.

Employment grew after 14 consecutive months of decline as well through growth in new orders and production.

The US Bureau of Economic Analysis reported that the inflation adjusted GDP increased by 3.5% in the third quarter of 2009. This is the first time the US economy has seen any growth since the second quarter of 2008.

Despite these good indicators we have to remind ourselves that there are still obstacles as some of this was driven by the cash for clunkers program (now expired) and the home buyer credit which is set to expire. Tight lending standards and still high unemployment will still hamper consumer spending. Inventories are still about the same with a slight reduction in the numbers.

The Cass Freight Index reflects the yet to be seen freight recovery as it shows that in the US, shipping slid 4.7% in October. This matched the low numbers seen last spring.

In this economy there are winners and losers. Berkshire Hathaway announced they were buying all of BNSF for $100 per share or about $44 Billion.

YRC Worldwide is asking their shareholders to give up 95% of their stock value in a last ditch effort to keep their company alive.

At Wagner we continue to see opportunity but there is a lot of caution on the part of companies when making decisions right now. Wagner is aggressively making deals where we can to drive facility utilization.

With our ability to offer contract packaging, distribution/fulfillment and transportation combined or as stand alone services we can drive value into most companies supply chains.

Please let me know if there are any projects we may collaborate with you on.

Have a great week!

John