John’s Blog

5-31-10

Dear Friends,

Big-ticket goods sold well in April rising 2.9% (Commerce Department report) as durable goods rose for the fourth straight month. The leading cause was the sale of commercial aircraft so when transportation equipment is subtracted, manufacturing orders actually fell 1% taking a break from the March high of 4.8%.

On the plus side was the increase in new home sales which rose 15% which is the most since March of 2008. 15% of all home sales are new home sales so it would appear that this important category is on the upswing.

The Conference Board reported that consumer confidence increased to a reading of 63.3% in May up from 57.7 in April, the highest reading since March of 2008.

The job market is slowly improving as well with 290,000 jobs added in April increasing personal income up 0.4% from March. As long as this trend continues the fragile recovery should continue to drive transportation growth as consumer spending will follow.

Last Thursday the AAR reported that intermodal volume increased 12.7% over the same week last year for a total of 215,118 units shipped. Container traffic increased 14.4% and trailers increased 3.9%. Freight rail traffic rose 10.6% to 288,114 carloads.

The American Association of Railroads also made the observation that traffic was beginning to level off.

Please let me know if you are experiencing any supply chain challenges and perhaps Wagner may collaborate with you to craft a solution.

Have a great week!

John Wagner Jr