"The news prompted David Rosenberg, chief North American economist at Merrill Lynch, to note that it “is extremely rare to have truck tonnage go down in October ahead of the holiday shopping season — declines of the likes we saw last month took place in 1981, 1982, 2001 and 2002, and these proved to be disappointing sales periods.”

“Truck tonnage for October just came out and looked borderline recessionary, for lack of a more polite term. It was down 4% y/y in the largest decline since February 2001 (-1.8% m/m, and down now in two of the past three months) - and now down for 10 months in a row  y/y (!). You have to - again - go back to the March/00 to Feb/01 period to find the last time year-on-year  comparables were in the red for such a long stretch of time (and guess what happened in March/01?).”

How much of a leading indicator of future economic activity are trucking volumes? Have a look at the chart above. The slow down in the beginning of the year was very likely related to the decline in  Housing and Construction. It fairly accurately foretold the dramatic decrease in Home Building.  And, it makes sense that when we see weak October shipping volumes -- during the pre-holiday inventory build up -- it may bode poorly for the Christmas shopping season.

The overall trend in this  indicator is not particularly encouraging for near term economic growth . . .   




ATA Truck Tonnage Index Fell 1.8 percent in October
Tiffany Wlazlowski
American Trucking Associations, Monday, Nov. 27, 2006   

Truckin’, Like the Doo-Dah Man
David Gaffen
WSJ MarketBeat, November 28, 2006, 11:28 am