Trucking proves things are getting better.
First let me issue a challenge to you to prove my point. Name one thing you have that at some point didn't ride on the back of a truck? Trucking is the life blood of the economy. If we are to grow the country needs commerce. That is why trucking proves things are getting better.
What is it that every truck needs? Right, diesel fuel. That is why professor Ed Leamer, Ph.D of the UCLA Anderson School of Management along with Comdata, the major issuer of credit cards for truckers to buy fuel at over 7,000 truck stops, have joined to create a real time, minute by minute, index of the movement of goods along the interstates of America. They are calling this index the “Pulse of Commerce”.
"Though the January 2010 number is disappointing, the index is 3.6 percent above its January 2009 level and is similar to year-over-year pre-recession values," said Edward Leamer, director of the UCLA Anderson Forecast and chief economist for the Ceridian-UCLA Pulse of Commerce Index. "Also, the three-month moving average is 2.3 percent above the previous year's value, which is the first time that there has been a year-over-year increase since April 2008, 21 very difficult months ago."
The latest PCI numbers suggest caution about celebrating the recently announced 5.7 percent GDP growth number. Although the 7.3 percent growth rate in the fourth quarter of 2009 for the PCI was strong, at that rate the index won't exceed the 2007 second quarter peak until the third quarter of 2011. "Things are going to have to look a lot better in February and March to turn this worry into optimism about the power of the recovery," Leamer said. "Stay tuned. We expect this showing in January indicated by the PCI will also be seen in the Industrial Production number when it is released later this month."
Leamer noted that the high December number for the index may have reflected delayed purchasing and shipments for the holiday season since the index did not see the usual holiday restocking uptick in October 2009.
The Ceridian-UCLA Pulse of Commerce Index also provides a regional breakdown based on the nine U.S. Census regions. The three-month moving average of the national index was also reflected regionally. The East South Central region was the only area enjoying better growth than the previous month, climbing from -1.8 percent in December to 0.3 percent in January. While five other regions continued to experience growth in the movement of goods, the pace of growth had dropped from the high December values.
"The majority of the regions may still have experienced growth, but we're not seeing the consistent, positive momentum generally considered necessary to significantly improve the labor market," said Leamer. "The index numbers for the remaining coastal regions actually dipped into negative territory. All signs continue to point to a weak economic recovery, too slow to drive down the unemployment rate."
So are things picking up? That's what the experts in this area are saying. Let's look at some anecdotal evidence.
In 2009 the miles that I ran are down to 125,000 from 132,000 in 2008. Also the number of days that I went home are down by 11. I don't remember how many miles I ran last January, and I'm at the wrong computer to look it up, but this January I ran just over 14,000 which is way over my normal amount. In 2009 my average rate was down 41 cents per mile over 2008. Lately I've noticed an increase in my rates. The increase is tied to the lack of trucks compared to the amount of freight, which again would indicate things are getting better.