The Gathering Storm

Nobel laureate and Times columnist Paul Krugman foresees a bad economic storm ahead, and while not explicitly stated in his "macro" views, the railroad industry can only be looking at "hurts":

Fair Use - as if effects two major classes of traffic:

Building materials:

Higher interest rates lead to reduced demand for houses, which leads to a fall in construction; as incomes earned in housing construction slide, this leads to reduced demand for other goods, and the effects spill over to the economy at large.

But all of this takes a while. The Fed’s rate hikes have indeed led to a sharp fall in applications for building permits. .

And with less household appliances coming from overseas, think of the effect upon Containers:

Oh, and remember all those supply-chain problems that disrupted the economy and raised inflation some months back? Well, the cost of shipping a container across the Pacific, which was $20,586 in September 2021, is now $2,265

OK, agriculture gets a pass; the world still must eat. And coal? Well that already, save an "uptick" owing to the War, that's already the biggest looser.

Atlanta, Jax, Ft. Worth, Omaha, Calgary, and Montreal; are you reading?

Something tells me that the service level problems over the last year are suddenly going away.

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I had originally posted this material at its own topic, but then realized that it is a continuation of thought last expressed by Mr. Olesen.

Chessie is licking up her Fancy Feast. and Topper is "feeling his oats" in his paddock after having learned of this Journal article.

Not sure what our "Two Uncles" - Pete and Warren - will think about it.

Fair Use:

The hierarchy of U.S. ports is getting shaken up. Companies across many industries are rethinking how and where they ship goods after years of relying heavily on the western U.S. as an entry point, betting that ports in the East and the South can save them time and money while reducing risk.

Apparently, vessels awaiting berths at West Coast ports is becoming a non-issue, but even PANAMAX and the East Coast ports could be looking at backlogs. The article suggests they might already be.

They're already having trouble getting enough wells into Saint John in a timely manner, as well as moving containers out of there. NBSR can't get new units fast enough, CP has run through some power on their EB container trains.

Interesting opinion I came across, off the Daily Kos: Southwest's meltdown shows the Friedman Doctrine is a disaster waiting to happen

One of the most damaging theories to be embraced by the business world was the belief that corporations have only one responsibility: to increase shareholder value. This is part and parcel of the Friedman Doctrine which holds that the only social responsibility of a business is to its shareholders — and shareholders are the only ones who should decide if a company should include anything or anyone else in that agenda.

To put it another way, it means a business has no responsibility to its employees, its customers, the long-term health of the company, the communities in which it operates, or the country in which it is based — other than avoiding actions which would hurt shareholder value. In practice this amounts to extracting as much money out of businesses as can be managed in the short term.

Hmmm... sounds a bit like what the railroad companies are doing, and we're seeing the effects now.