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The American Trucking Associations’ advanced seasonally adjusted (SA) For-Hire Truck Tonnage Index jumped 6.8% in December after rising 0.3% in November 2011. The latest gain put the SA index at 124.5 (2000=100) in December, up from the November level of 116.6.
For all of 2011, tonnage rose 5.9% over the previous year – the largest annual increase since 1998. Tonnage for the last month of the year was 10.5% higher than December 2010, the largest year-over-year gain since July 1998. November tonnage was up 6.1% over the same month last year.
“While I’m not surprised that tonnage increased in December, I am surprised at the magnitude of the gain,” ATA Chief Economist Bob Costello said.
“Not only did truck tonnage increase due to solid manufacturing output in December, but also from some likely inventory restocking. Inventories, especially at the retail level, are exceedingly lean, and I suspect that tonnage was higher than expected as the supply chain did some restocking during the month.” he said.
rangerone314 wrote:The figures I gave were for January, which reflected a much sharper change downward than December, which was not looking grim.
This index has been weaker than other measures of transportation such as the ATA trucking index or the AAR rail traffic report. In the full report, Dr. Leamer looks at several possible explanations for the divergence - a shift to rail traffic, the difference between diesel fuel transaction (up for the year) and gallons (down for the year), and possible efficiency due to the high price of diesel fuel. There isn't a clear explanation.
General Motors recorded its highest profit ever last year, though fourth-quarter earnings and revenue fell short of expectations.
The 103-year-old company made $7.6 billion in 2011, up 62 percent from 2010.
TheAntiDoomer wrote:GM Posts Highest Profit Ever
Thank you Mr. President.General Motors recorded its highest profit ever last year, though fourth-quarter earnings and revenue fell short of expectations.
The 103-year-old company made $7.6 billion in 2011, up 62 percent from 2010.
How did investors react to all this hope and cheer? With a giant yawn: GM’s stock price, which has been hovering around $25 for months, barely budged. That’s $8 below GM’s IPO price. And it’s $30 below what’s needed for taxpayers to recover the $30 billion they still have stuck in the company.
If investors aren’t buying GM’s rosy scenarios, it’s for some good reasons. Peter De Lorenzo, editor of Auto Extremist, notes that GM is facing the most competitive market in history and investors are dubious that it can deliver. GM’s $8 billion in profits last year resulted partly from the tsunami in Japan that disrupted Toyota and Honda’s global supply chain.
Tougher competition in North America is not GM’s only worry. Its sales in China are slowing. Also, Europe will probably remain a trouble spot. GM suffered $2 billion in losses in Europe last year, thanks to Opel, its hopelessly bloated German brand. But GM has been unable to obtain permission from the German government to restructure its labor costs, even as European sales plummet in an economic meltdown.
Toyota (TM) and Honda don’t have the same exposure in Europe and hence have less to worry about. What’s more, GM’s global pension obligations are underfunded to the tune of $22 billion, about $10 billion in the United States alone.
That’s not all the exposure that taxpayers will have going forward. The GM bailout has distorted the playing field so badly that its competitors are demanding their own handouts to even things out.
For example, McAlinden notes, the administration gave GM about $10 billion more than was strictly necessary to finance its bankruptcy. The money contributed to GM’s nice $33 billion cash cushion right now. GM could use this money to buy its own stock and bid up prices, mitigating taxpayer losses -- or pay dividends. But McAlinden doesn’t believe that’s what GM will do. It could use the money to pay off its obligations to the union health-care trust fund, making this a direct infusion of cash from taxpayers to unions.
Or it will use the money toward product development, putting its competitors at a disadvantage. Moreover, because all but $10 billion of the bailout money GM got was in the form of equity, the company has no debt service costs. Ford (F), by contrast, is still servicing the $23 billion in debt it took to avoid a bailout.
This is unfair, and the Obama administration knows it, which is perhaps one reason it quickly approved a $5.6 billion retooling loan for Ford. That, in turn, elicited howls of protest from Chrysler’s Sergio Marchionne. The administration gave Marchionne’s parent company, Fiat, the majority stake in Chrysler without asking Fiat to contribute a single euro of its own.
Yet Mr. Marchionne complains that the administration hasn’t been generous enough. In contrast with GM, it forced Chrysler to service the bailout loan. Now it’s dragging its feet in approving Chrysler’s new retooling loans, he claims.
Bailout supporters maintain that it was a one-time deal necessary to shore up companies in acute economic times. In reality, the rush for the bailout’s spoils has produced ripple effects that may well haunt the economy for a long time.
As President Barack Obama campaigns to keep his job, he will spin the bailout as a success story that saved millions of American jobs. But taxpayers should bear in mind that the hit to their wallets will be substantial and will probably grow in years to come.
The number of Americans who applied for unemployment benefits dropped last week to the lowest level in almost four years, further evidence of an improving U.S. labor market, government data showed.
Initial claims are a good gauge of whether layoffs are rising or declining. They’ve fallen steadily since last summer, an indication that fewer people are losing their jobs and more are finding work. As a result, the unemployment rate has declined to 8.3% from 9.1% last August, though it still remains quite high at this stage of an economic recovery.
The Labor Department on Thursday said jobless claims decreased by 13,000 to a seasonally adjusted 348,000 in the week ended Feb. 11. That’s the lowest level since March 2008, when the U.S. was in the early stages of a recession.
Economists surveyed by MarketWatch estimated claims would rise to 368,000. Claims from two weeks ago were revised up to 361,000 from 358,000.
The four-week average of claims, meanwhile, fell by a smaller 1,750 to 365,250, keeping it near a four-year low. The monthly average smooths out seasonal quirks and provides a more accurate view of labor-market trends, economists say.
New construction of U.S. houses rose in January, according to government data that analysts had expected would be boosted by unseasonably warm weather.
Housing starts for January rose 1.5% to a seasonally adjusted annual rate of 699,000, according to an estimate from the Census Bureau and the Department of Housing and Urban Development.
Economists polled by MarketWatch had expected a rate of 688,000 housing starts for January.
In December the rate reached 689,000, compared with the previously reported estimate of 657,000.
Single-family housing starts fell 1% in January to a rate of 508,000. Meanwhile, starts in buildings with at least five units rose 14.4% to a rate of 175,000, continuing the surge in creation of apartment buildings.
A closely followed index of manufacturing activity in the Philadelphia area reached a four-month high in February in further evidence of the continued strength in the manufacturing sector.
The Philadelphia Fed’s manufacturing index climbed to 10.2 in February from 7.3 in January to reach the highest level since October.
Economists polled by MarketWatch had expected a reading of 9.5, and the better-than-forecast reading sent the Dow Jones Industrial Average to session highs.
The components of the index were strong, with the new orders index rising from 6.9 to 11.7 and shipments jumping to 15.0 from 5.7.
The inventory index fell to -12.9 from -6.3 in January -- good news, says TD Securities’ Millan Mulraine, because it points to further upside momentum for production activity in the coming months.
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