Rail Traffic Continues to Point Towards Economic Growth

No big change in rail trends this week as the growth continues.  The year over year growth in intermodal came to 4% in the latest reading from AAR.  This brings our 12 week moving average up to 3.9% which is the highest level in over 6 months.  Overall, this indicator has trended very nicely with broader economic growth so if there’s anything to glean from this narrow view here it’s continued growth.  I guess the government shutdown didn’t stop the trains from working….

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Cullen Roche

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. He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance and Understanding the Modern Monetary System.

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Comments

  1. UNP intermodal flat yoy (-1% international, up 4% domestic). CSX on the east coast intermodal up 8% yoy “driven by growth with our existing customers and continued highway to rail conversions.”

    ytd much of the intermodal gain has been highway to rail conversions. As an example, FDX is working hard to transfer deliveries to an intermodal network.

    The quarterly releases give a much clearer picture than the generic intermodal chart as they strip out conversions from trucks. Automotive, industrial, construction, highway to rail conversions, and chemicals have been strong all year offset by weak coal and ag.

  2. I am sure that explains why Facebook is priced over $50 per share and a trailing PE of over 200 …

  3. I’m not well versed in the rail data, but how much of the upside in rail traffic is a result of the increased usage of rail to transport oil and other refined petroleum products? Just curious if anybody new or if it is not relevant to the over all trend.

  4. I know you’re just joking about gov shutdown related to rail data because obviously the effect of the shutdown won’t be in these numbers for a while. But I noticed that tax receipts appear to have topped (dailyjobsupdate.com), which I would bet has a lot to do with the recent spike up in interest rates. And then there will be an impact of the shutdown – some say 0.5% off GDP. Plus any negotiations are likely to result in lower spending on top of the already lower deficits. So I wonder if you are following any other indicators that are showing a slow down ahead?

    My gut tells me we peaked and we’re going to start seeing slower economic data in the coming months.