Excerpt from the Daily Reckoning (Australia)
http://www.dailyreckoning.com.au/key-market-signal-shows-stock-collapse-has-only-just-begun/2015/08/24/
A 100-year old theory has once again been signaling all is not well.
How does ore get to China? How do all those electronic goods get onto the floor of Harvey Norman? How did all those foreign cars get into the dealer’s showroom? How do all those business people and travelers move from city to city? How does the wool from the sheep’s back end up as a pullover on your back?
Most of us do not really ponder these questions too deeply. The answers are all too obvious — planes, trains, automobiles and ships. So what’s the big deal?
The movement of commodities, goods and people are an indication of economic activity.
During the GFC, ships stayed anchored because banks did not trust each other’s credit. Would you transport millions of dollars of cargo if you knew there was a serious question mark over payment? Not likely. Transp
Interesting, and thanks for posting. The current markets do seem concerning.
I wonder what railroads are used now-probably the Class Is and IIs?
I also find it interesting that the BRT and ME are included in the listing, as they were primarily dependent on employment which would falter only during a collapse. In 1901, the ME didn’t have long in the world.
CSX, KCS, NS and UP are on the list, Oct. 1, 2014.
I have my own un-scientific method. I compare car counts on the same trains over time as they go by my backdoor. I’m seeing fewer 100+ car trains these days.
Mike:
I am with you on the car count. Also, scanners on the CSX and CN will provide total axle counts. There are several common trains which will provide a pretty good indication of where the economy is (noted that certain days this is based on “events”). Certain NS intermodals have been consistent over the years, but now are dropping in number of containers/trailers.
There is definately a slowdown occuring.
Also, take a look at the weekly AAR carloadings for the railroads. These provide a very vivid picture of what is occuring on a weekly, quarterly, and YTD basis compared to the previous year. Coal is down 25% for most carriers now. OUCH.
Ed
Current composition of the DJ Transportation Index (20 companies) has four railroads:
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Corporation |
Ticker |
Industry |
|---|---|---|
|
ALK |
airlines |
|
|
CAR |
rental and leasing services |
|