Jump to content

Association of American Railroads 1st Q Report


Parsad
 Share

Recommended Posts

Here is the first quarter report by the AAR.  Terrific analysis over the last three-five years.  Definite recovery, but mixed rebound. 

 

http://www.aar.org/~/media/aar/railtimeindicators/2012-04-rti.ashx

 

Personally, I think things could go either way...corporations are in great shape, but you've got significant deleveraging still occurring and governments are now out of bullets.  If they find any more ammunition, it will come with a ton of delay and political back & forth.  Many new controversial policy initiatives aren't likely to pass.  Expect more volatility, and I would really be approaching things with caution. 

 

Buy only when you get something very cheap, and keep some dry powder!  Cheers!

Link to comment
Share on other sites

Here is the first quarter report by the AAR.  Terrific analysis over the last three-five years.  Definite recovery, but mixed rebound. 

 

http://www.aar.org/~/media/aar/railtimeindicators/2012-04-rti.ashx

 

Personally, I think things could go either way...corporations are in great shape, but you've got significant deleveraging still occurring and governments are now out of bullets.  If they find any more ammunition, it will come with a ton of delay and political back & forth.  Many new controversial policy initiatives aren't likely to pass.  Expect more volatility, and I would really be approaching things with caution. 

 

Buy only when you get something very cheap, and keep some dry powder!  Cheers!

 

as we approach the 2013 "fiscal cliff" of increased taxes kicking in & govt spending cuts right on the heels of a fast n' furious 6 month 20% market sprint higher that just might be sound advice  :)

 

while informative, these rail load metrics look like somewhat lagging or co-incident indicators to me. more forward looking might this:

 

http://www.contraryinvestor.com/mo.htm

 

and i also thought this snippet i just ran across to be especially provocative from a (gasp) macro standpoint:

 

"No, all of these are secondary items. Here is what is of absolutely critical importance in the just released Goldman letter, nested deep in Hatzius' final paragraph, where it would otherwise be missed by most:

 

 

...we have found some evidence that at the very long end of the yield curve, where Operation Twist is concentrated, it may be not just the stock of securities held by the Fed but also the ongoing flow of purchases that matters for yields...

 

For those who are aware of the Fed's sentiment vis-a-vis the debate of stock vs flow of money effect, this will be a stunning revelation. Especially since it vindicates what we have been saying since day one, namely that when it comes to securities price formation in a centrally-planned regime, it is flow not stock that matters. And as those who follow the Fed's thinking know too well, the Fed is convinced it is stock, not flow that serves as a consistent catalyst for subjective risk valuation. The above quote is just the first crack in the Fed's thinking, because if Goldman now believes this, so will Bill Dudley, following his next meeting with Jan Hatzius at the Pound and Pence, and shortly thereafter, it will become canon at the Fed.

 

One way of visualizing what this means is to think of a shark which has to be constantly in motion in order to survive. Well, the allegory of Jaws can be applied to liquidity addicted capital markets. Translated simply, it means that it is irrelevant if the Fed's balance sheet is $1 million, $1 trillion or $1,000 quadrillion. A primacy of flow over stock means that UNLESS THE FED IS ACTIVELY ENGAGING IN MONETIZATION AT EVERY GIVEN MOMENT, THE IMPACT FROM EASING DIMINISHES PROGRESSIVELY, ULTIMATELY APPROACHING ZERO AND SUBSEQUENTLY BECOMING NEGATIVE!"

 

 

 

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
 Share

×
×
  • Create New...