John’s Blog 9-1-11

Dear Friends,

The economy’s numbers are, once again, all over the map.

Consumer confidence is down, but actual consumer spending is up. Factory orders? Up. Capital goods orders? Down. Durable goods? Back up.

What does it all mean? I see an economy being held back by fear. With so much drama over budgets and debt in Washington already, just as the political season is about to shift into full attack mode, consumers and business are nervous. I remain in the camp that believes improvement is happening, but at a snail’s pace. With the jobless numbers creeping along with very modest improvement, we have a long way to go to recovery.

Here are the details:

The best news of all is that consumers are still spending. The Commerce Department said this week that consumer personal spending increased 0.8% in July. That’s the key metric for the supply chain world, as consumer spending drives 70% of the economic activity across all modes of transportation.

This is good news heading into the fall shipping season, although tempered by the latest consumer confidence reading. The Conference Board says their index fell to a reading of 44.5 in August, down a full 15 points from July and taking the index to its lowest point since April 2009.

By contrast, durable goods orders hit a high point. The Commerce Department reports that durable goods orders bounced up 4% in July following a 1.3% decline in June. This is the best number in four months. Commerce also reports that overall factory orders increased 2.4% in July with vehicles/aircraft leading all sectors. On the down side, capital goods orders fell 0.9%, indicating business continues to be edgy about the economy.

Shipping numbers are as varied as other economic indicators. The seasonally adjusted For-Hire Truck Tonnage Index, as reported by the American Trucking Associations, was down in July by 1.3% after being up 2.6% in June. Year over year compared to July 2010, tonnage is up 3.9%, and for all of 2012 tonnage increased 5.2%. Trucking volumes have been bouncing up and down in a narrow range for the last few months.

The Association of American Railroads says that traffic was up a little in the week ending August 20^th.  Intermodal traffic increased 1% with containers up 1.7% to 205,910 units, countered by trailer traffic falling 3.4% to 32,770 units when compared against 2010.

Rail carload business was up 1.1% with 300,521 cars handled.

In the meantime Wagner continues to move forward doing what we do:   Moving freight, fulfilling consumer and retail orders, supporting manufacturing with materials, and exceeding our clients’ expectations.

As you do your 2012 planning please feel free to reach out with any challenges and let the team at Wagner help.   We welcome the opportunity to tackle your issues wherever they are; we can and will open a facility anywhere in the U.S., providing tier-one technology and Wagner’s renowned high-touch service.  Leverage our capabilities and Bring It!

Have a great day!

John Wagner Jr