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Trainwreck? US Freight Carloads Collapse, Flash Recession Warning
Trainwreck? Rail traffic fell in July from a year ago as WSJ reports an increase in container volumes couldn’t offset a steep decline in oil and coal shipments according to the Association of American Railroads. Despite almost constant reassurance that plunging oil prices are 'unequivocally good" for America, AAR analysts warn "railroads are overexposed, relative to the economy in general, to the energy sector," adding that traffic data indiates "growth is slow and the recovery could be threatened by an interest-rate increase by the Fed."
We have seen this kind of slide before...
As The Wall Street Journal reports,
Rail traffic fell in July from a year ago as an increase in container volumes couldn’t offset a steep decline in oil and coal shipments, the Association of American Railroads said in its monthly report Friday.
The number of carloads carrying oil and petroleum products dropped 13.6% from a year ago to 67,909 last month, while coal volumes sank 12.5%. Container shipments rose 3.8% to 1.2 million. Traffic overall fell 1.8% to 2.7 million, the association said.
Oil-train shipments have tumbled this year, hurt by plunging prices for crude and concerns about the safety of transporting petroleum by rail. That, plus declining demand for coal from power plants and overseas buyers, has hit railroad operators’ earnings.
...
“Railroads are overexposed, relative to the economy in general, to the energy sector,” analysts with the AAR said in the traffic report.
The intermodal transport of containers and trailers was a bright spot for the railroads in July, reflecting an expanding economy. Still, the AAR report cautioned that growth is slow and the recovery could be threatened by an interest-rate increase by the Federal Reserve, which is widely expected this fall.
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"growth is slow and the recovery could be threatened by an interest-rate increase by the Fed."
Growth is negative by about 5% or so if you use accurate inflation data to calculate real GDP
The Chapwood Index for 2014 was 9.7% and official CPI in the land of the free was only 0.8%. So the Nominal GDP of 5.6% for 2014 becomes real GDP of -4.1%.
The revised real GDP for years 2011 to 2013 worked out to -6.2%, -6.5%, -6.5% respectively.
Dude I'm sorry but I am not getting how a higher inflation rate is forcing a sub GDP print?? the CPI and GDP are two completely different animals. Enlighten me please
You measure a nominal GDP growth and then you use the inflation estimate to calculate real GDP growth.
If nominal GDP grew 2% and the Fed says inflation was 0.8% (as they did in 2014) then real GDP growth was 1.2%.
But if the Chapwood Index shows inflation at 9.7% (as it did in 2014), then real GDP growth was -7.7%.
So the fake inflation number of the Fed has boosted real GDP by 8.9%.
So having a low inflation number always boosts the real GDP. This game has been played since the early 1980s in the US of A.
Yeah, the reviews of that Amy Schumer movie was awful!
Well...YEAH. Who wants to watch that pig fuck?
So she plays a slut on the big screen. I'm sorry. If I'm gonna pay that much for a movie I want to see an actress, not a Reality Show writ large.
Pretty close. The CPI index takes into account final goods & services that CONSUMERS IN URBAN AREAS typically use. However, they adjust nominal GDP to "real" GDP using the GDP Deflator which is calculated similarly but takes into account "all" goods and services- some of which are not picked up in CPI (B-2-B stuff as well as import/export data, some other crap and garbage that doesn't matter and is probably just as manipulated).
Please note I am totally picking nits with you here. Your basic explanation is plenty close for government work.
Huh hu huh. He said plenty close for government work. Huh huh
Very little of what I put in my posts is an oversight or by accident.
I once told WB7 he always got the heads a little too big for the matching bodies in his artwork. He slapped me down pretty hard. He made it very clear that was no mistake. I questioned him no more on the subject after that.
I work in a similar vein.
I work my vein between the sheets. Sometimes it gets slapped down pretty hard.
Very little by accident, says Mrs. Bandgap.
Uh, wait. I'm confused. Rail traffic in the U.S. Increased from 6000 to 16000 whatever -the-fucks since 2006?
.
Jstanley --- could not have said it better
I believe that was Obama squashing pipeline expansion to benefit Warren Buffets' Berkshire Hathaway fund on the backs of Canadian oil producers. That's how you get a rise of 6000 to 16000.
Right... after all if they fall as low as 6000 what-ever-the-fucks isn't that 'returning to historical norms'?
If his numbers are close toreality then he will never work at the BLbS.
CONSUMERS IN URBAN AREAS
I didn't know that. This brings another point, How can we apply one statistic to a whole country of our size and diversity? We do that all the time in many ways
Plus goods looted are counted towards GDP.
Forgive me, I think I may have known this once. It has been 35 years since I've seen the inside of an econ classroom. Thank you.
Difference between nominal and real GDP - the latter adjusted for inflation. Say you have an economy that makes widgets - just one. And that is GDP. If the price goes up by 5 % would we say that nominal GDP grew by 5 %? Yes. But - in real terms, the GDP has not changed.
hey LunaticFringe --- wrote a song for you --- https://www.facebook.com/bama.watson.9/videos/vb.100006784955008/1665956...
It wouldn't play....rook.
Print two mile long trains! Fudge the books some moar! Someone do something!
You just gotta know the Orifice of Omaha has been on the red phone to his mut poodle demanding some train loads of gooberment shit to move around the country and back to it's place of origination.
Hey Buffet... how are you going to get more freight, like oil? Shut down the Keystone pieline? You can't shut down a pipeline already shut down.
He profitted somehow from insider info.
Don't fool around with Warren Buffett, what he knows about the 9/11 conspiracy could send a lot of luminaries to the gallows.
---
On the morning of the September 11, 2001 terrorist attack on America, before the attack commenced, the world's second most wealthy man was already at the U.S. Strategic Command headquarters where G.W. Bush flew later that day for "safety." As the attack began, Anne Tatlock was already en route to this same location. She arrived at the base to join Buffet in time to watch the second plane make a direct hit on the tower precisely where her office complex was located.
Mr. Buffett was reportedly at his home in Omaha, Nebraska watching TV when he heard about the terrorist attacks. He was getting ready to host his "last annual golf charity event" which just happened to be at the U.S. Strategic Command headquarters located at Offutt Air Force Base in Omaha.
http://thewebfairy.com/killtown/buffett.html
Also on the morning on 9/11, a small group of top financial CEO's with offices in the WTC, were flown to the nerve center of U.S. air defenses, for the "Charity Classic" golf event (fund raiser benefit for youth groups).
Look at the luck of Ann Tatlock, the CEO of Fiduciary Trust Co. International mentioned previously. Now what made Mrs. Tatlock such a lucky person for being invited to this charity event that morning? Mrs. Tatlock not only works in the World Trade Center, but her offices were right where Flight 175 crashed into the South WTC Tower. Fiduciary Trust just so happened to be running an emergency drill on 9/11. Fiduciary Trust is also the company of Scott Forbes, the key eyewitness to the power-down of the South Tower.
Tatlock was escorted by military officers to an officer's lounge at Offut AFB that had a TV to watch it happen.
http://www.bizjournals.com/sanfrancisco/stories/2002/02/04/story3.html
GEORGE W. BUSH FLIES TO OFFUTT AFB on 9/11:
?President Bush didn't fly back to Washington D.C. due to a very strange threat against Air Force One but flew to Barksdale AFB and then was enroute at 2.50 p.m. to Offutt Air Force Base.
?3:07 p.m. – Bush arrives at U.S. Strategic Command at Offutt Air Force Base in Nebraska
? The United States Strategic Command, or USSTRATCOM, is headquartered at Offutt Air Force Base, Nebraska.
http://www.telegraph.co.uk/news/worldnews/northamerica/usa/1365455/Revealed-what-really-went-on-during-Bushs-missing-hours.html
Your two links take me to broken faceplant pages. WTF????
BNSF has two tracks by our facility. Saw something today I've never seen before. Two two-mile long trains heading opposite directions...and they were all empty! Why the hell would they do something like that?
OT: What hammered gold all of a sudden?
Chinese devalued the yuan bigtime....trying to save their market...looking for news now
Actually, devaluaiton is akin to an easing of policy, so it should ultimately be a risk on or off whichever one would cause more GDP and inflaiton so that maybe whatver might or might not rally, depending on the depth of one's relapse.
(Should really thus be good for gold, commodities, etc.)
Devaluing the yuan means it costs more yuan to buy each ounce of gold, which means they can't buy as much gold now as before with the same number of yuan. Now there's less demand for gold from China even though the gold same gold goes up in value in yuan denominated currency. They could use their foreign currency reserves, but I doubt they will.
It might also increase demand for gold, as people fear additional devaluations.
Also, it increases the value, in Yuan, of gold you own. Sort of. But if you don't believe this is a one-off, maybe you buy more gold.
Could increase sales.
Edit: Pitz types faster than me.
How is that going to work? If the rest of Asia follows the Chinese lead and they all devalue currencies, won't oil - priced in dollars - become more expensive?
Devaluation is beggar thy neighbor. They are trying to salvage markets after the patheic numbers reflected over the week end. Lotsa devaluations going on and this should accelerate things as other countries themselves try to salvage their markets. Confer 1930s.
Devaluation is futively forcing your deck chairs on the Titanic away from the railings and closer to the cabins than other's deck chairs: the ship is sinking, and wherever you go, there you are...
Look more closely next time. One of those trains was hauling supplies to the Rainbow Power Plant. The other was hauling units of "power" made at the Rainbow Power Plant back out to retail stores near you. Perhaps you can arrange for them to drop some off at your facility, saving you a trip to the store...
I saw scads of rail cars loaded with coal in NRG containers on Sat.
I thought they shut down the coal plants & converted to NG.
Coal to Coke production is used in making steel.
Wiki: Since smoke-producing constituents are driven off during the coking of coal, coke forms a desirable fuel for stoves and furnaces in which conditions are not suitable for the complete burning of bituminous coal itself. Coke may be combusted producing little or no smoke, while bituminous coal would produce much smoke. Coke is commonly used as fuel for blacksmithing.
NRG=Utilities
How's that steel industry doin here, eh?
There is a very good reason that empty trains are passing each other. Something about cooking the Books so the IRS are lead away from where they should never look .. Right Warren "Cherry Cola' Buffett you fucktard
The reasons for the Fed to NEVER raise rates keep mounting. This is awesome news for the Fed since their only responsibility is to the banks. Of course to us sheeple (Main St) they'll act all sad and shit and say something off the wall that has nothing to do with anything.
That's what The Bernak said after he left orifice; "Not in my lifetime."
How much ice cream does it take to fix this one?
CSX Railroad has temporarily shut down the railroad line that runs through Flora. CSX officials sent a crew to the Flora area, Friday morning, to cut the line, which makes the tracks unusable.
The cut was made just west of the Hanging Rock Crossing, which is located south of the old Lincoln Grade School, west of Flora. The cut is a government requirement, which must be done on all inoperable rail lines.
CSX officials attribute the shut down to a lack of business on the line, which runs from St. Louis to Cincinnati.
Likely a bad business decision to build a line to Cincinnati
Food stamp recipients need food delivered to the Piggly Wiggly but section 8 residents don't buy cars or dishwashers or ladders. Food comes by truck, the others arrive by rail.
yeah, because Ohio is such a low population state... niggaz better recognize. This shit is getting real!
None of Hitlery's camps at that cut are there?
Any ovens under construction?
That's biased, as it includes crude by rail volumes.
If marginal shale sites aren't producing, they're not shipping rail cargoes. The lower the CBR volumes, the better for CL prices.
The midstream companies have been laying pipelines across ND like madmen the past few years. That likely accounts for less crude rail traffic. All of the frackers increased production YOY. It's the oil majors that are cutting back. YOY crude production is still up by 1Mbpd
Can I just interject that those slightly increased container numbers are just pre-christmas crap starting to come into the country for the holiday season. It jumps a little every August do to that.
It's worse than the collapse of shale moving - that's bad enough. But those container volumes they mention of- ARE EMPTIES - for which RR's get a nominal charge over full loads.
USD is killing forest product exports and related pulp and paper. Uncle Warren can eat shit since he told US exporters to fuck off when he was printing money with Wally St & The Shales. Now many of those buyers have resourced to a South Am or Eurarabia.
You might want to short the RRs - they are heading for a world of shit full throttle.
Trannies are going down to 7000, then 6000, then 5000, then 4000, down 52%, and the Oligarch of Omaha's BRKA will return to 2011's 100,000, down the same, minus 53%, or lower, and I've got the popcorn stack and butter to watch the entire collapse:
http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=DJta&insttype=&freq=2&show=&time=12
http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=brka&insttype=&freq=2&show=&time=12
Yuan devaluation will be another nail in the freight and shipping coffin. First currency to the bottom wins!
how are the hobos going to ride the rails?
The Mexicans are getting free TV's;
http://www.miamiherald.com/news/nation-world/world/article30617448.html
If Bama gave free shit to us it would jack up our GDP and we would all be happy like the Mexicans. Krugman said so.
Here are some more signs of a coming recession.
http://michaelekelley.com/2015/05/29/mergers-and-acquisitions-set-record...
http://michaelekelley.com/2015/02/20/fed-warns-of-two-bubbles/
http://michaelekelley.com/2015/02/24/would-you-pay-39-more-than-asked/
http://www.zerohedge.com/news/2015-07-27/when-will-we-ever-learn/
Here is how to prepare.
http://michaelekelley.com/2014/10/16/8-things-to-do-when-recession-happens/
Here is how to get your mind off this stuff.
http://michaelekelley.com/category/humor/
Good luck!
Did government spending stop?
I've suspected this for some time now. I have a shop next to the Union Pacific rail yard in Roseville, CA. This rail yard is huge. It is seven miles long, and is on the last stretch of flat ground before the Sierra Nevada Mountains. This is where the trains are assembled for the trek across the Sierra Nevada and all points east.
I've been around here for 25 years, and in the past couple of months I've seen many more UP locomotive engines in the yard than I recall seeing in the past. I've wondered more than once what was going on, and if there is an equivilent to the Baltic Dry Index for rail traffic.
What the hell...the railroad recovery might be threatened by a .25% increase by the Feds?...are we looking for a scapegoat outside of our business environment?...
If this starts happening within the next several weeks/fe months, gird your loins:
http://www.railroad.net/forums/viewtopic.php?f=128&t=57997
If you see the railroads 'storing' freight cars offline, that is off of main line tracks, that means we're headed towards a meltdown in the transportation sector.
It's a service economy now.
We just need to go out and get our haircut more often and things will soon pick up.
So, this data point tells us that the energy sector is in depression, while the rest of the economy is just fine. In other words, what we knew already.
Flashing yawn, maybe.