Trucking Sector Recession Officially Here...

Without turning this into a political discussion, the media may actually be able to turn this into a self fulfilling prophecy by preaching doom and gloom to the American public and getting them to hold back on major purchases, thereby causing a recession. The sky is falling mentality by some is nothing more than yet another attempt to win back control of the government

The market dropped so much yesterday because of something called an inversion where short-term bond rates were getting a higher interest rate than the long term bonds. Usually, the is a precursor to a recession but not always. The last time it happened was in 2005, and it took until 2007 before the recession started and that was due more to the housing market than the inversion.

As others have pointed out, freight moves regardless of what the market and the economy is doing. We need less truck capacity in order the get rates back up. It will happen, we just don't know how long it will take.

 

And there you have it -------^
Next step?

Ummm. ok. Let's call TIMEOUT for just a second here. I want to ask some recent relevant questions.
Are we not looking at at least ONE (more likely two) more "bubbles"? Sounds to me like big money 'inversion' (i.e. : loss profit gains, put/pulls, Bill-"I didn't have relations"/Back-swim champ of the 90's-C, committees, brokers, corporations - insider first hand tactics and back room deals) controlling that swing and shaking it up to keep the lower class from making a break to middle class WHILE keeping mid class blue collar workers from pulling savings to spend {since this is on topic as it relates to the Logistics of goods and services}. This type of mass movement, while no one wants to hear, it may be the tells they're blatantly pulling before the televised/connected masses. They orchestrated the killing of a man about to play out his stack of dirt to save skin in the game that's still afoot. It's a game, to them. A mad man's game, but I digress.
Do you get the feeling that the industry might just be having evolving pains? Yes, they are choking the highways with under-qualified drivers, and, not to mention the 18 and 19 year olds, that are still developing their hormones, possibly being an option out for INTERSTATE travel. Hell, I bet my private auto insurance rate just went up typing those words. See what I'm driving at here? Tackle the new 14/10/8/7/3/2 law... still putting your right arm in / out - as per Hooky Pookie Rules and Regulations.... Now dash a bit of irregularity in with tariffs. Put in all in that melting pot, the one we founded that union on, and put a dab of pity - stir till boiling over.

THERE IS A WAY OUT OF THIS MESS THAT DOES NOT, I repeat, NOT cripple our nation and possibly the majority of the world. Small changes CAN be made to have BIG effects.

 

The media is actively praying for a recession, and have come out and said it will be worth it to have one.

 

Look at USA Trucking's second quarter results - net profits are 2 orders of magnitide smaller than 2nd quarter 2018.

Schneider is cutting back hiring. Target class size for new drivers is half what it was for the last 5 years and safety is getting less of a pushback from ops when they want to term a new hire.

Looking at revenue per total mile, per loaded mile, and total miles we show a significant drop off from previous years.

Georgia Pacific just announced the are delaying planned expansions. Looking at the trailer lots for GP, PG, etc there are a lot of open spots and not many lines waiting to get in/out.

Thats the bloodbath people are talking about.

 

Actively propagandizing the masses into falling for one on schedule is more accurate in my opinion. This morning msnbc kept showing a bunch of wall street stock floor stooges with ridiculous looks of shock on their faces.. Literally huddled together in fear.

The wall street trading floor with verbal callouts is a puppet show. Computer algorithms have been making the markets on a nanoseconds timeline for years. None of it happens "on the floor" anymore. Its just a media cue for you to be afraid, so obey and dont look behind that curtain.

This trade war is fake too, as are the staged protests in hong kong. The chinese govt has had total control of its population since before i was born. Outbursts are allowed for strategic deception.

But itll all get baked into the next bubble pop which has been due for a long time. Learn schiller PE ratio cycles and megaphone charting patterns.

 

I wouldn't call it a bloodbath, till they can't find enough people to repo trucks or enough land to store repoed trucks on, like in past down turns.

 

Time to get into the repo business.

 

I don't think so, not just yet anyway, I tend to think everybody just got used to some exceptionally good times last year and it is just returning to normal.
Too many claims they are still busy, so some areas are still going strong.

 

Already there.

I looked at my records from 2006 to 2009 and my profit margin was never higher, I expanded the fleet from five trucks to twenty and waited it out from 2009 to 2012 and still made good money. I used the philosophy that there is work out there for all, just have to find it. Hell I looked at GM work we were doing and they paid very well when they were trying to run the company into the ground to get the taxpayers money.

You guys think that the megas are the indicator of the industry but they are not, it is the medium established fleets that where the indicators are at, this is where you see a retraction or contraction of capacity and labor to show a real recession, the megas pad their capacity and labor to capture the revenue from any fallout in the medium class fleets.

Overall we need a contraction, we need to get rid of those who bought on a whim and not in the industry for the long term, like a bunch of those 300 truck fleets which were bought up by private equity firms to be the next XPO or something like that. I seen one hit the market back in April and they just sold it at a huge loss because they were trying tie the debt from other startups to it and crashed it.