Weekly US Railroad Carloadings Down 17.1%, Cumulative Decline By 18.2%
The latest Carload Traffic data from the Association of American Railroads is out. If one relies on one of Warren Buffett's traditional leading indicators, there is no respite in sight for the economy. Weekly decline was -17.1% for week 38, with material hits across virtually every carload category. Cumulative traffic decline was relatively flat over the past month at -18.2%.
Official press release from the AAR:
The Association of American Railroads today reported 271,659 carloads for the week ending Sept. 26, 2009, down 17.1 percent compared with the same week in 2008. The traffic numbers were affected by severe flooding in Tennessee and Georgia which halted freight shipments in those areas from Sept. 21-23. Flooding also impacted the western freight carriers who operate through Atlanta. At this time, freight rail operations have returned to normal. Regionally, carloadings were down 15.5 percent in the West and 19.3 percent in the East.
Intermodal traffic of 205,627 trailers or containers on U.S. railroads was down 16.5 percent from the same week last year. Container volume fell 11 percent and trailer volume dropped 37.2 percent.
All of the 19 carload freight commodity groups were down from last year with declines ranging from 6 percent for chemicals to 38.5 percent for metals and products.
For the first 38 weeks of 2009, U.S. railroads reported cumulative volume of 10,104,171 carloads, down 18.2 percent from 2008; 7,141,006 trailers or containers, down 16.8 percent, and total volume of an estimated 1.08 trillion ton-miles, down 17.3 percent. Total volume on U.S. railroads for the week ending September 26 was estimated at 28.8 billion ton-miles, off 17.2 percent from the same week last year.
(4 votes)
on Thu, 10/01/2009 - 18:36
#85917
h2so4 and now this....what is the world coming to?
well at least you can water the green shoots with this
bargain priced acid....and kill a few weeds too
on Thu, 10/01/2009 - 18:36
#85918
TD,
This has baffled me more than anything else. Rails have always been a leading indicator. This chart I posted today shows how clearly the decay in the economy has leveled off, but it also shows that there has been no recovery at all from the trough levels.
http://pragcap.com/rail-traffic-remains-depressed
I think people are overestimating the strength of this recovery and it is on full display in this data.
on Thu, 10/01/2009 - 18:48
#85928
have you been in a cone silence for the past
6 months? the editorial stance of zh has been
that the pom pom girls have overstated their
case.
but it was a nice way to drive traffic to your
site.
on Thu, 10/01/2009 - 21:38
#86072
Ahh yes, because the 500 hits it produces will make or break my bank account! Who are you kidding?
It's an entirely relevant question and I thought you might like to see the data in chart form since I am the only one who seems to print it....
on Thu, 10/01/2009 - 21:54
#86089
Classic pinkie wave salute.
on Thu, 10/01/2009 - 20:09
#86010
Does anyone have a good method to compare current %changes in rail-traffic with past recessions and depressions. I know this isn't apples to apples given that we are a SERVICE "?ECONOMY?" now, but should still be interesting. Also any reliable reads on port traffic, I have been using "baltic dry" as a gauge, but port-traffic data would have less distortions.
on Thu, 10/01/2009 - 22:13
#86105
I've done some pretty extensive research on it. Rail data has turned positive almost without fail (on a year over year basis) BEFORE the stock market and economy bottomed.
on Mon, 10/05/2009 - 09:54
#88853
If you only look at the hard copy from the AAR you are missing quite a bit of detail in the carloading numbers. The economy tanked last year at this time and only started to recover in late winter. The AAR reports show the lousy YoY comparisons. Starting this month you are going to see monster YoY positive comparisons. Will it make the bullish case? No. But nor do the poor YoY comparisons up to now make the bearish case. The economy as reflected in the railfax.transmatch.com numbers is coming back slowly but more quickly than a few months ago. It's all about the rate of change.
on Thu, 10/01/2009 - 18:37
#85920
Any thoughts are welcome....I'd love to hear a cogent argument as to why railroads are still at recession levels while the banks and media tell us everything is fine....
on Thu, 10/01/2009 - 18:43
#85924
Pure and simple, out of the belief (nay, hope) that preception will lead reality, instead of vice-versa.
on Thu, 10/01/2009 - 18:44
#85926
First, which banks---Us banks have little credibility. Second "all media" neither... CLSA is bearish, so is SoGen
on Thu, 10/01/2009 - 19:02
#85942
Don't forget my brain crush, rosie!
on Thu, 10/01/2009 - 19:05
#85948
hahahaha, no longer US bank! I read him every day...
on Thu, 10/01/2009 - 19:25
#85968
i'll add that Bianco at BAC/ML is getting more and more bullish...he recently upped his spx projection to 1200 and upped earnings estimates for this Q. I'm saving his reports as I think we might have some fun with them, say, march/april 2010
on Thu, 10/01/2009 - 19:28
#85971
have access to Merrill but don't read them, says something?
on Thu, 10/01/2009 - 19:32
#85974
yes indeed, that says a ton!
interestingly, Mary Ann Bartels (technical analyst) has become increasingly bearish.....then again, they do live in different worlds with a different perspective.
Mary Ann had a nice piece today on the flattening of the 10y2y curve which is worth a read.
on Thu, 10/01/2009 - 19:46
#85993
on Thu, 10/01/2009 - 19:53
#85999
you youngsters are certainly quick!!
on Thu, 10/01/2009 - 19:57
#86004
There are interesting points there, will take a good look. I think this rush into risky assets is waaaaay overdone, unwinding ?
on Thu, 10/01/2009 - 20:45
#86034
for those interested, a telling snippet from the report and note the current spread of approx. 3.17 minus .87 = 2.30. might hold that little block of faz i have for a little bit.
The steepening trend for the US Treasury market yield curve (10-year T-note yields minus 2-year T-note yields) is showing
signs of stalling. Since late May / early June, the pattern has been sideways. Breaking the uptrend line from the December 2008 low is an initial sign of a change in trend. To suggest the risk of a deeper narrowing of the yield curve, it would take a decisive break below 240-235. In our view, this would be bearish for the financials, which benefit from a steeper yield curve
on Thu, 10/01/2009 - 20:52
#86037
Agreed. BTW, my response is at Bruce's
on Thu, 10/01/2009 - 21:01
#86044
aha!
1. loved the "chinese pig farmer essentials"...very clever.
2. thank you for the GD clip! I see Weir alot via Ratdog and actually have become fairly well acquainted with him as we have chatted several times....he still consistently messes up the lyrics of "truckin"....he is a very nice guy I will say that.
on Thu, 10/01/2009 - 18:51
#85930
one is an objective representation of reality...the other is a subjective body whose profit depends on people buying what they're selling.
on Thu, 10/01/2009 - 18:57
#85936
You sir, win an award.
on Thu, 10/01/2009 - 19:03
#85941
I'd love to hear a cogent argument as to why railroads are still at recession levels
TPC - I don't believe one can be made. Hope that helps.
on Thu, 10/01/2009 - 19:04
#85946
I certainly haven't been able to come up with one and believe me - I've tried....
on Thu, 10/01/2009 - 19:18
#85960
I have come to the conclusion that with respect to your question the old saying; "Try and try again and you will find success" does not apply. My sloped forehead is a testament to time banging my head against the wall of objective circumstances attempting to find a solution to that and similar questions only to grow tired of the squishy sound that was being generated.
on Thu, 10/01/2009 - 19:59
#86005
Miles and TPC...take a look at Bruce Kastring's article here on zh today about sulfuric acid shipments being woefully off. I think most of that stuff goes by rail first, then to trucks.
in my old days as a deadhead, acid was delivered in a car up from long island
on Thu, 10/01/2009 - 20:24
#86016
goods are teleported these days, just like our tax dollars
on Thu, 10/01/2009 - 20:31
#86022
Occam's razor says "because we are still in a recession". That said container inter model is seasonal & usually picks up in late October.
on Thu, 10/01/2009 - 20:52
#86036
Because it totally matches the CFNAI which keeps printing recession month after month?
http://www.chicagofed.org/economic_research_and_data/cfnai.cfm
on Thu, 10/01/2009 - 19:02
#85943
Honestly, when you hear ANYONE talk about the economy you need to understand their motivations.
Easily 90% of the guests on any business channel are long-only fund managers (or economists who work for long-only fund companies), who are "talking their book". They are long equities, so they want equities to rise.
Banks need the economy to recover so the bad loans they have on their books will perform better, so they spin things positively.
The media? Who knows. Depends on the outlet, no doubt an outfit like CNBC is influenced by their corporate parent who needs a recovery to survive.
Even bearish commentators, they talk their book too.
The great thing about a site like this is it provides a lot of facts and you can make your own decision (granted, with a fair bit of bearish commentary, but it is almost always witty so is fun to read).
Anyway, that is my take.
on Thu, 10/01/2009 - 19:50
#85997
+1 and, yeah, this place is really entertaining. Thanks TD and co. Just don't pull a Ritholtz.
on Thu, 10/01/2009 - 20:22
#86015
2nd
on Thu, 10/01/2009 - 20:36
#86028
Here's entertainment, if that's what you're looking for: Cash Cow - High-Frequency Trading 4:22 Samantha Bee wants to tell her small investor friends about high-frequency trading before regulators outlaw it
on Thu, 10/01/2009 - 21:55
#86090
It's funny and entertaining. I like it! I also do schadenfreude, so I like that too.
Talking the book ... I don't have one, I could I suppose go to a store and buy one ...
Now look, kiddies, it's time to get serious! I don't know what I have to do to get this through your skulls ... but what you are seeing is 'hard petro- currency' in action. $70 a barrel oil is slowly and steadily destroying the US economy from the bottom up. All the financial maneuverings (and shenanigans) will not alter either this fact or the ultimate outcome.
Don't believe me, just sit back and watch. Better yet, check this space in a year. There is no turning back the clock on this. Credit is irrelevant; credit is simply another means to ration (allocate) energy in the productive economy ... too bad we don't have a productive economy.
Okay, back to the laffs ...
on Thu, 10/01/2009 - 20:29
#86021
Your friendly neighborhood Central Bank and Treasury Secretary (and in conjunction with a host of world heavies) have pulled out all the stops to ward off the 2nd Great Depression. They have directed "positive press" by spinning numbers as positive as possible, timing press releases and other sorted speeches to offset bad numbers and probably talked in person to a number of media owners to ensure that a positive tone prevails.
The U.S. stock market has been deftly "managed up"; probably through coordinated buying by several big banks as well as manipulation by JPM and GS as market makers (pull back on the sell side at the right times). No one knows for certain where the 700B TARP monies went; probably alot of it has been used to buy stocks up (and of course sell back as others buy in). The intent of the market move is not to enrich the banks. The intent is to make everyone feel a little richer and get confidence back into the whole sticking system. Barring some unanticipated extreme/external event (e.g., attack, assasination, etc.) the Big Boys are not going to let this market fall back. Count on it. Anyone that has watched this trading action over the past several months can see how manipulated it has been. It will continue.
On gold, don't count on any big jump in price over the next few years. The Fed and other Central Banks will simply sell into any rally and suppress it. Count on it. A big run-up in gold would encourage fear among many and simply feed on itself. Again, the strategy is to reduce fear, build confidence slowly and let the economy settle out.
On housing, the plan is clear. Banks have been instructed to slowly let the housing bubble deflate. That means people will stay in houses without paying, houses will sit empty until the bank is ready to sell or the bank may become a landlord. All of those things are happening now. The key to the strategy is to slow and stop the decline in residential housing.
On deflation/inflation; of course we're in a serious deflationary environment. The Fed is scared shitless of this and is doing alot to stop it from taking off. They are doing two things: 1) In conjunction with other governments, they are holding the price of oil steady and will NOT let it free-fall even thought the current fundamentals would support a much lower price. Natural gas is 1/3 of it's pre-crash price but oil is not. Oil pricing can be manipulated with government purchases (strategic reserves) as well as a little help from our friends the Saudis and other friends in the Gulf. Oil is critical to stopping a deflation spiral in that almost all goods/prices are tied in some way to it.
2nd method for countering deflation is inflating the money supply. Sure no banks are lending but money is being added via the stock market run-up and of course Fed buying of Treasuries and other debt.
So those are the strategies. Well engineered and executed, we'll have a muddle along economy with super high unemployment (Bernake has warned) for probably 5 years or more. Barring lack of political will (Bernake's biggest fear as stated in unprecedented 60 Minutes interview) OR a serious out-of-the-blue event (probably non-economic), the governement will continue these strategies and hope that the economy ignites back before everything falls into a stinking heap!
on Thu, 10/01/2009 - 20:43
#86033
I tend to agree, except for one small problem. You need to borrow a shitload of money for that to work. So since that is not an open-ended possibility, your plan is their plan, until that plan no longer works.
on Thu, 10/01/2009 - 21:06
#86047
Oh come on you got high frequency trading making it go up 1/3 as fast as if you didn't have it, and it only takes a bit of money to drag it back down to where you want it to be if you don't pocket your HFT profits during the compression phase. Unless of course you're talking about the last week and a half when it just won't freaking budge no matter what you do. I'm thinking you could keep it down to 1010 for less than a measly couple hundred billion in this last quarter. Easy to do with yen carry trade. It's not like you got a bunch of wacko leaders in Japan totally kicking america out of their economy.
on Thu, 10/01/2009 - 21:29
#86068
Because the coach and team captain try to remain positive even if your team is losing 38-3 at half time. The railroad data tells the score; the President, officers, Fed, banks are trying to remain positive. The media's job is to report on what they say. IMO, its Obama's job, as it was all Prez dudes before him, to remain positive. That idea goes WAAAAAY back: See, McCullogh, Washington for some cogent examples. While Washington remained confident before his troops, his letters to Congress and his brother wreaked of despair. You'll note Obama and his crew try to sound optimistic and upbeat but temper their assessments.
MO anyway.
on Thu, 10/01/2009 - 19:03
#85940
Very heavy downside on the construction related. I have a closing tomorrow and as a RE broker, I suspect it could be my last for the rest of the year. It is an FHA, but still it was pulling teeth to get it for my buyer. Also, I see Ford truck sales were up - people planning a run for the hills?
on Thu, 10/01/2009 - 19:04
#85944
The following is an example of how deeply (and desperately) hope runs in the average American for a recovery and thus why they are willing to listen to and believe in the green shoots crap.
I was talking to a client of mine today and I mentioned that the railroad car loadings were still down and had never rebounded, despite what the TV and newspapers were telling him about a recovery.
He paused for a second and then told me that because so many companies had run down their inventory and were now desperate to build those inventories back up in the face of the strong rebound, those companies were FLYING in the commodities they would normally bring in by rail.
I immediately thought of burlap bags of coal and wheat placed on empty seats on hundreds of Southwest Airlines 737's.
I kid you not. That's what he said. I was nearly speechless. Clearly my client didn't want to have his hoped for recovery disproved in any way. I thanked him for his insight and hung up.
on Thu, 10/01/2009 - 19:05
#85949
Talk about cognitive dissonance!
on Thu, 10/01/2009 - 19:18
#85962
HA! +1
on Thu, 10/01/2009 - 19:13
#85956
Denial is one of the strongest forces in human nature. Besides, many folks have resigned themselves to the belief that somehow or someway the government and the fed will play their games and everything will work out regardless of the force of gravity and decay rates. The rails simply provide one more data point that after all of the trillions in "stimulus" and "bailouts" this is most likely the apex that process can engineer. Denial will soon meet the hard and unforgiving wall called objective circumstances which is usually a very painful process.
All The Best
on Thu, 10/01/2009 - 20:36
#86027
"Denial is one of the strongest forces in human nature. Besides, many folks have resigned themselves to the belief that somehow or someway the government and the fed will play their games and everything will work out regardless of the force of gravity and decay rates. "
very well said Miles
on Thu, 10/01/2009 - 20:27
#86019
Hey Asshole,
You client reads ZH too.
on Thu, 10/01/2009 - 21:57
#86094
Check that match book cover for your nearest GED training facility Anon
on Fri, 10/02/2009 - 04:49
#86176
If my client was reading ZH, he'd have enough sense not to tell me companies were flying in their bulk commodities. I think I'm safe here.
on Thu, 10/01/2009 - 21:24
#86062
http://af.reuters.com/article/topNews/idAFJOE58S07T20090929
If you think the 18 pecent decline in 2009 was brutal. You REALLY don't want to know what happened to air freight in 2008.
on Fri, 10/02/2009 - 09:18
#86396
He meant flying in via UFO apparently because there was a post here the other day that showed Air freight was down as well..........truck tonnage too.
There is no recovery it seems
on Thu, 10/01/2009 - 19:04
#85945
6:46 PM A large survey of buy-side investors and sell-side analysts finds 42% read blogs for stock market research, and 12% use social networking sites. Of those surveyed, 12% cited "new media" as a top-three source, vs. just 5% for business media, and 58% believe new media will become increasingly important in helping them make investment decisions.
Glad I'm not one of the 42% dolts.
on Thu, 10/01/2009 - 19:04
#85947
Wait.
I just read an article _last_week_ on Yahoo Finance that said rail traffic was improving. I remember raising eyebrows at the time...."this does not make sense"...
on Thu, 10/01/2009 - 19:22
#85964
http://www.google.com/finance?q=GOOGLEINDEX_US:UNEMPL
on Thu, 10/01/2009 - 19:28
#85972
Well, we all know the the cartel is spending trillions upon trillions to maintain the matrix. We know that eventually reality will overtake perception. And, when it does it will be downright scary. Taking a snip from a post in the general discussion about exit strategy sums it up quite well on what has been going on:
"Central bankers and government policymakers have been quick to assure market participants that a global exit strategy is in the making, but no one has come forward to delineate what steps need to be taken. When investors need more than a half-year to find out what the exit strategy is, to paraphrase an old adage, they probably are the exit strategy."
on Thu, 10/01/2009 - 19:37
#85981
Train tracks alongside the Spirit/Boeing plants in Wichita are being replaced. Downtime must be the right time ;-)
on Thu, 10/01/2009 - 19:44
#85989
WSJ reports Citadel made $1B in trading profits on HFT - details coming out in court case
http://online.wsj.com/article/SB125444025346057763.html?mod=WSJ_hpp_MIDD...
on Thu, 10/01/2009 - 19:57
#86000
Every since ZH posted the images of the ship graveyard, that image has never left me. Every time I see it in memory, it sends chills down my spine. This rail stat does the same.
My brother is a patent lawyer in VA and he says patent apps are down huge. He is a bear, but more focused on political commentary. When I send him ZH links, he says "why is the MSM not reporting this?" John, for the millionth time, you know why.
on Thu, 10/01/2009 - 20:34
#86020
this is a true ship grave yard (depressing but brilliant art)
http://theonlinephotographer.typepad.com/the_online_photographer/images/...
Edward Burtynsky, Shipbreaking # 4, Chittagong, Bangladesh, 2000
http://www.christies.com/LotFinder/lot_details.aspx?intObjectID=5123443
Edward Burtynsky, Shipbreaking # 31, Chittagong, Bangladesh, 2001
PS how does one post actual photos here? level V security clearance I imagine
on Thu, 10/01/2009 - 20:41
#86032
Heavy indeed. I saved it. Certainly there is a lot there to think about. Judging by the load rates on ZH, they need more bandwidth and sure they will step it up. Not like the early days. Lots of anti INGSOC brothers now. Thank God.
on Thu, 10/01/2009 - 20:36
#86026
sem-per idem my friend sem-per idem
on Thu, 10/01/2009 - 20:40
#86030
Looks like Boxcar Willie has put out the vacancy sign. I am surprised that some are surprised. You need to get out more. The recession is raging out there. There's no recovery in progress except those derived by the twisting and squeezing of tiny little data points by overzealous CNBC types. Recovery in what? Look at rail, natural gas, sulphuric acid just today - no demand. How about labor? No thanks, we're full up here.
on Thu, 10/01/2009 - 20:56
#86041
Indeed. Cheers
http://www.youtube.com/watch?v=WbrjRKB586s
on Thu, 10/01/2009 - 21:10
#86051
FANTASTIC! I was 15 and just started highschool. September 25, 1980 is a day I remember - and only 1 of two days I remember, clearly. The day John Bonham died and September 11, 2001, the day................My country......
I am a huge fan. Thanks
on Thu, 10/01/2009 - 21:47
#86080
STOP IT! I'm the one who posts that song on doomer blogs.
Wh, Wh, Well you just, Wh,
Take that you, you...
http://www.youtube.com/watch?v=FgHSk91RhL8&feature=related
on Thu, 10/01/2009 - 21:57
#86093
+100
There was no internet. No HFT. Nice
on Fri, 10/02/2009 - 00:23
#86150
I debated this. It is just the right thing to do.
http://www.youtube.com/watch?v=wEiyGgWt6no&feature=related
on Fri, 10/02/2009 - 09:22
#86412
mmm mmm mmmm Zeppelin goodness thank you for making me emotional, it has been a very tough year
I consider this support from like minded peers, and am so so grateful.
Weighing in...
http://www.youtube.com/watch?v=rJb3Lcvtn4M
on Thu, 10/01/2009 - 22:15
#86107
Great, I love the real! As you well know you stammering associate.
Back to the corn rows, or twiztidies as the case may be, outta knowledge of all the wired up zombies out there..
http://www.youtube.com/watch?v=mJteVFTJ_Jo
Lyrics .. Sort of.. from the first Wake up!.. BTW, catch the previous black - red - black ref?
http://www.azlyrics.com/lyrics/twiztid/rockthedead.html
on Fri, 10/02/2009 - 00:02
#86139
From the sandwich exchange. I was out in the cold, and sorry about it.
on Thu, 10/01/2009 - 21:53
#86087
When conventional statistics are determined to be cooked or otherwise bogus, you have to revert to simple input / output measurements.
While the book smart ass clowns / jokers are pushing carefully crafted mumbo jumbo, I say Stop!
I don't give a rats ass about your MBA / PHD Bull Shit.
Just count the raw input / output. Look at the cash flow. Anything more complicated than that is a diversion into some smoke screen.
The indicators I follow show SAAR of declines ranging from 15 to 30 % based on realistic measures of commerce.
How these Mopeds come up with their pronouncements, and why anyone would believe their stats is not relevant.
The purpose of Headline Numbers is to support predetermined market operations.
on Fri, 10/02/2009 - 09:20
#86405
Which indicators do you flollow
TIA!
on Fri, 10/02/2009 - 03:11
#86159
Soon the Fed will start traficking unloaded freight railcars... "we'll fake a recovery no matter what it takes"
on Fri, 10/02/2009 - 08:40
#86317
I hope WalStreetPro2 didn't order a train carload of chain saws and injure himself in that garage. Even with a sweet swing like his a roaring saw can jump when it touches Chinese plastic.
on Fri, 10/02/2009 - 09:09
#86374
"It's an entirely relevant question and I thought you might like to see the data in chart form since I am the only one who seems to print it...."
Thanks for data
on Fri, 10/02/2009 - 09:15
#86387
I hate to be a green-shooter, but, my bro-in-law works for UP, and has been telling me they are picking up 1000's of cars now....looking at YoY numbers is a little misleading. Check out the chart in this article and look at the data from around 5/09 forward (not the moving average). Imagine the average line there and you do see an uptrend since then.
http://pragcap.com/rail-traffic-remains-depressed
on Fri, 10/02/2009 - 10:24
#86497
Bottom bouncing and nothing more. Look at the key rail traffic numbers from 2009 vs 2007 for Coke, Lumber and Wood Products, and Motor Vehicles & Eqpt. Cumulative 38 week traffic data reveal they are down 48.9%, 51.5% and 47.2%, respectively and the rate of decline is accelerating. At some point traffic decline will level off as the rate of deceleration has to slow as you get toward the bottom. However, this does not mean we are trending upward. It means we are dead in the water.
This country is in a DEPRESSION. The gov is in denial and wants to "spur" growth through massive spending progams. The only GDP uptick we will have will be from gov spending, and when that merry go round stops the financial system as we know it will collapse.
on Fri, 10/02/2009 - 10:46
#86534
Imagine the average line??? Bottom bouncing and nothing more. Analyze the 2009 vs 2007 traffic for Lumber & Wood, Coke, and Motor Vehicles & Eqpt. Traffic is down 51.5%, 48.9% and 47.2% respectively, and the trend is accelerating. Eventually the trend will slow as we hit bottom, but a slowing trend is not an uptrend. We are in a DEPRESSION and our "leaders" are trying to con the American public into believing everything is getting better. Hogwash.
The only "improvement" in GDP is from government spending. The spend spend spend mentality this government has will lead to a far more serious crises, which will end up destroying the dollar and the middle class in the US.
Post new comment