Rail traffic for the week ending September 24th posted another positive gain with carloads showing 1.1% gains and intermodal traffic showing 3% gains.  I think this data is still consistent with a muddle through economy and not the substantially deteriorating economy that many are coming to expect.  If we look back to 2008 you’ll actually notice that rail traffic had turned negative well in advance of the recession, but the recent data is still positive although just slightly.  In short, this is far from a robust economy, but the rail traffic data does not appear to be consistent with an economy deteriorating substantially.  The AAR details this week’s data:

“The Association of American Railroads (AAR) today reported gains for weekly rail traffic, with U.S. railroads originating 305,133 carloads for the week ending September 24, 2011, up 1.1 percent compared with the same week last year. Intermodal volume for the week totaled 248,402 trailers and containers, up 3 percent compared with the same week last year. This weekly intermodal volume is the highest since Week 39 of 2007.

Thirteen of the 20 carload commodity groups posted increases from the comparable week in 2010, including: metallic ores, up 21 percent; petroleum products, up 16.1 percent, and metals and products, up 16 percent. Groups showing a decrease in weekly traffic included: grain, down 21.4 percent, and waste and nonferrous scrap, down 15.5 percent.

Weekly carload volume on Eastern railroads was down 2.9 percent compared with the same week last year. In the West, weekly carload volume was up 3.8 percent compared with the same week in 2010.

For the first 38 weeks of 2011, U.S. railroads reported cumulative volume of 11,016,908 carloads, up 1.7 percent from the same point last year, and 8,630,362 trailers and containers, up 5.5 percent from last year.”


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Cullen Roche

Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering research, private advisory, institutional consulting and educational services.

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  • sc

    Frankly I’m more interested in where it has come from than where it is now as that is the trend.That is even more interesting when global growth is notably slowing and austerity appears to be gaining traction for policy indicative that the trend is more likely to continue without some form of signifcant policy reversal across the US major trading partners.

  • El Viejo
  • http://binaryoptiontutor.wordpress.com/ Options Trader

    Sadly this is one of those data points that makes politicians say, “maybe if we do nothing and wait a little longer it will get better.”

    Sadly, that is what politicians prefer most: doing nothing.

  • http://n/a Paul Mineiro

    It’s muddle through right now, but with the passive tightening of monetary policy and the active tightening of fiscal policy, the forecast is bearish.

  • LRM

    Here is another traffic indicator.


    I must confess I do not know anything about this but it seems to indicate that shipping is turning down. This may indicate that the current account may adjust but that within USA, the movement of goods is stable from the rail data. I also wondered regarding the intermodal rail traffic if trucking companies were moving more items over distance via rail vs hiway to reduce fuel costs?

  • SCyankee

    Uuuhmm, could it be anything to do with Autumn being harvest season???

  • Fred

    actually, you have it backwards. it makes politicians think they can actually do something, which in effect is counter productive in and of itself, because the best thing they can do it to get out of the way. the beauty of capitalism is it has a momentum of its own. those who aren’t old enough to remember the fall of the wall and the sense of liberation from state domination can’t appreciate what it’s like to – finally – get government to a manageable size. it’s perspective that is sorely lacking these days and it’s going to be a long road back to full employment, whatever that means, since a majority now presumes that ‘work’ doesn’t actually mean work…..

  • arrrgh

    ” . . the rail traffic data does not appear to be consistent with an economy deteriorating substantially”

    i’m hoping you are right, but rail stocks are falling precipitously


  • Bond Vigilante/Willy2

    1. I “”don’t like, don’t buy”” the “”muddle through”” scenario. It’s IMO already much worse.
    2. The rail traffic data is flat. But those stats are looking back and the stockmarkets are looking forward.
    3. Remember the disastrous Philly FED report ?
    4. Perhaps a lot of trucking companies are going belly up and manufactures are shifting/are forced to shift the cargo onto the railroads.

  • http://www.traderscrucible.com TC

    So far tax receipts are holding up strongly too. The recent fall in gasoline prices is going to make a big deal going forward.

    If we get the expansion of the payroll tax cuts, we’re going to be in a boom.