From Panic-Buying to Lockdowns of Eateries & Manufacturing: Truckers, Railroads Face Supply Chain Turmoil, Spikes & Plunges

“There has been a clear divide between winners and losers.”

By Wolf Richter for WOLF STREET.

Panic buying in late February and March was followed by a sudden shift in consumption in mid-March away from restaurants, schools, college campuses, office buildings, other work locations to supermarkets, warehouse clubs, and ecommerce. For weeks, brick-and-mortar retail supply chains failed to keep up, and bare shelves in some product categories became a common sight. But the supply chains at the other end of the spectrum ground to a halt, stuck with goods that had no place to go.

This divergence has shown up in the trucking business. March was busy for truckers hauling dry-van trailers and refrigerated trailers (reefers). The Van Load-to-Truck ratio in the spot market surged by 56% from February and by 84% from March last year, according to DAT Trendlines. The Reefer Load-to-Truck ratio surged by 45% from February and by 91% from March last year.

But in April so far, all this has unwound. In the week ending April 12, the Van Load-to-Truck ratio plunged 44% from a week earlier. For the past two weeks, “Van spot freight volumes lost 20%,” DAT reported, “and national average rates lost 8¢ per mile, to $1.78, reflecting declines all over the country.”

“Reefer trends weren’t much better,” DAT said. The Reefer Load-to-Truck ratio plunged 42% over the week ended April 12, compared to a week earlier. “It’s been an up-and-down kind of market for reefer equipment,” DAT said in a blog post on April 9. “We’re not talking about a gentle rise and fall – more like a giant roller coaster.”

But it’s a very dynamic market, with reefers getting switched from the shut-down food services industry (such as restaurants and schools), to haul produce for the grocery supply chain:

Luckily for reefer carriers, there are still some markets and lanes where spot rates are rising. That’s because more fresh produce is coming into season, just as other refrigerated foods are being re-supplied to grocery stores at a more normal cadence. Produce season bolsters rates to some degree, but rates also face downward pressures because of the sharp decline in food services.

Trucking companies that used to service fast-food chains and school cafeterias are more temp-controlled trucks available to move whatever needs moving, so capacity is expanding while the level of demand is not going to change all that much. Everyone is still eating, even though the dining table is at home instead of in a restaurant.

The Flatbed Load-to-Truck ratio — it reflects demand for hauling equipment and supplies for industrial, construction, and oil-and-gas-drilling sectors — had been weak all last year. In March, it was down 10% from a year ago. In the week ended April 12, it plunged 43% from the prior week.

That week was further complicated for truckers by the havoc tornadoes wreaked in South Central and Southeast regions with high winds and heavy rain sweeping up the East Coast.

Based on its Market Conditions map, DAT said: “There are exactly two hot spots in the U.S. for carriers: Houston and Laredo. If you’re in South Texas, you should be able to find a load, and possibly a decent rate. A handful of markets are lukewarm, neutral, or cool, but most are an icy cold, deep blue.”

In broader terms…

Shipment volume in the US by truck, rail, air, and barge plunged 9.2% in March compared to the already weak March last year, and is down 10.1% from March 2018, according to the Cass Freight Index for Shipments. It was the 16th month in a row of year-over-year declines. The January and March declines were the steepest since October 2009. The declines accelerated last December:

The Cass Freight Index tracks the shipment volume of consumer goods and industrial products and supplies by all modes of transportation – truck, rail, air, and barge – but is more focused on trucking. It does not track bulk commodities, such as grains or coal.

“This has quickly gone from a China production concern to a US (and global) consumer spending problem,” said the Cass report. And it added, “April will undoubtedly be worse and likely the worst month in a long time.”

“There has been a clear divide between winners and losers of these shut-in orders,” Cass said. Ecommerce demand surged; consumers shifted purchases of supermarket goods to online for safety reasons; and consumers shifted other purchases online because the brick-and-mortar stores were shut down.

At the brick-and-mortar level, demand in March increased for groceries, home improvement goods, and consumer staples; but restaurant, auto, and mall-retail fell “to practically zero volume.”

The stacked chart – a line for each year going back to 2009 – shows the seasonality of the freight business. The top black line represents the historic shipping boom of 2018, when companies were trying to front-run the potential tariffs. 2019 (green) deteriorated as the year progressed. The red line represents 2020. The index for March was below March 2011, 2012, 2013, 2014, 2018, 2019. Also note Financial Crisis years 2009 (brown) and 2010 (light blue) at the bottom:


In March, rail carloads – various commodities, steel products, chemicals, autos, and others – fell 6% year-over-year, the Association of American Railroads reported. Containers and trailers (“intermodal”) fell 12.2%.

And this turned for the worse going into April. According to the AAR, for the week ended April 4, the latest available, intermodal units dropped 15.7% year-over-year. And car loads dropped 16.2%. Coal has been declining sharply for years. But even without coal, carloads declined by 13.1%. “We haven’t seen sustained declines of that magnitude since the Great Recession,” the report said.

Railroads have been reporting weak figures since last year, long before the coronavirus was an issue. For the first 14 weeks of this year, carloads fell 7.1% year-over-year, and intermodal units fell 9.1%.

In terms of intermodal units, the AAR said that this business much will depend on American consumers and their spending patterns. And “that, in turn, will depend on how long social distancing steps must remain in place; how well and how quickly federal and state unemployment insurance and other programs fill gaps in household cash flows; and how much the current situation causes consumers to lose long-term confidence and remain in retrench mode not just when health concerns begin to recede but, more importantly, when they have been largely resolved.”

In terms of carloads, the biggest declines were in steel scrap, steel products, nonferrous scrap, crushed stone, and – due largely to the oil-and-gas bust – sand, such as frac sand, and petroleum products. But the worst hit were autos and auto parts; with auto manufacturing shut down, carloads in that category plunged by 84%.

The numbers are huge: SoftBank Group said it would book a loss of $16.7 billion at its Vision Fund, stemming “from a decrease in the fair value of investments due to the deteriorating market environment.” But those paper gains sure were fun while they lasted. Read... SoftBank’s Fake Startup “Valuations” Come Unglued

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  168 comments for “From Panic-Buying to Lockdowns of Eateries & Manufacturing: Truckers, Railroads Face Supply Chain Turmoil, Spikes & Plunges

  1. raxadian says:

    If the lockdown continues for several months, who will be the greatest winners?

    • Phoenix_Ikki says:

      Judging from today’s market close, looks like almost all major S&P and Dow companies. We’re now by definition in a bull market…ain’t the world great?Turmoil everywhere and market just keep going up and up. To answer your question though, definitely Amazon….Dr Evil just got $24B richer since the start of this, now he can finally buy tons of those sharks with the freaking laser beams.

      • Wisdom Seeker says:

        We’re not “by definition” in a bull market, unless you believe someone else’s half-baked definition.

        • Ed C says:

          We’re in a hell of a rally, which makes absolutely no sense to me. Is the Fed that powerful in manipulating the market? Economy shackled, massive unemployment. Is this really the set-up for a ‘V’ market recovery?

        • Phoenix_Ikki says:

          I was being sarcastic and by definition means a very narrow technical definition advoctaed by some of the pundits on CNBC

        • Wisdom Seeker says:

          Ed C, the current market action is very, very similar to the 1929 crash, which also had a subsequent initial rally.

          Very typical of bear markets to have strong rallies. Most of the strongest up days in market history were during / just after the big crashes.

        • El Dorito says:

          This is not your great-granma’s depression, there was no FED in 1929 buying all the stocks the day after the crash.

          The dead-cat bounce that followed the Oct-29 crash was the believers, now its just the FED.

          What I find interesting is the velocity of the rebound, hardly anytime to buy on the dip, it was like if you didn’t have a head’s up March 16, then you weren’t setup correctly, but then we already know that all our favorite politicians were notified, so they were able to short at the right time, and then later go long at the right time.

          IMHO this thing will continue as long as we have a FED that has a heart beat, its nothing to create/print trillions, wait for a few more years when Quadrillions, and Septillions will seem normal.

          This thing continues as long as Uncle-Sam can pull off the confidence scam, which is what he’s doing just fine, first Trump ignored the virus ( rightly so ), and then he took it on like a War, then he declared the war ‘won’ not unlike Bush and “Mission Accomplished”

          The entire show is/was narrated and planned, right down to the Faucci-Trump WWF showdown.

          Seems all too good to be true, if your an insider (GOV), then you get to only win the stock-market lotto, everybody else loses or gets less than nearly zero ROI on their cash.

          If this continues the GOV People will be the Elite, and everybody else a Serf.

          Lord works in strange ways

        • Short_Seller_Blake says:

          Everything before 1971 should be erased because back then the fed didn’t have an unlimited amount of printing us dollars and was backed by gold then. Now, we’re backed by nothing but our military, oil and bolsheviks

        • HD says:

          I’m firmly in the camp of Egon von Greyerz and the likes by now. In short: we’re at the end of a 100 year cycle. Nixon taking the US off the gold standard was a major turning point, because it laid the groundwork for out of control spending. There have been pretty frightening “credit events” since then, in 1998 / 2008 / 2020) with ever greater oscillations and the amount of money pledged to extinguish the fire having become ridiculous now: if you thought the fed’s actions were insane back in 2008, look at what they are currently doing to keep the system from imploding). Currency debasement, possibly through hyperinflation, will be the final phase, as the only way to purge the debts and reset the system.

          And all of this because we decided it was not a good idea to keep a tight reign on our expenditures and let it al run wild in the past four decades.

      • char says:

        Amazon is king in which web is eating B&M retail. But now with Covid we are in a pure etail market. I don’t think that that is so great for Amazon.

        • p coyle says:

          stop using amazon. it’s not that difficult. think boycotting walmart, but using the internet.

          seriously, it can be worked around. i have never shopped at either amazon or walmart. i am still here. you can do it too.

        • kam says:

          Amazon is the China of retailing. Kill off all competition.

          Eat hearty Jeff, an electronic Sears catalog has no inherent barrier to entry.

      • cienfuegos says:

        Of course it’s a “Bull” Market…as in “Bull $#₩t.”

      • Spent more this last month at HF/Home Imp stores than any month the last year. Mostly gardening supplies. I always wait in line. Next door they are getting a whole new roof, and the crew hasn’t missed a day. Building supplies moving, and lots of rain here too. There will some pain on the other side, not right now.

    • polecat says:

      Anaerobic bacteria, slimy sales organelles, giant ceo centipedes, the various specie of Tick, ALL the internalized financial parasites, re-hypothecating rna fed-injecting viri ..
      In other words – the usual.

    • Wolf Richter says:


      It’s not going to be this type of lockdown for several more months. On the West Coast, they’re already planning the gradual loosening of the lockdown, with first steps maybe in May. Some aspects might become loser. Some people might be able to go back to work, some plants and stores might reopen — but with social distancing, disinfection, etc. designed into it. Everything is going to be different until there are effective treatments and vaccines or sufficient herd immunity. This is going to be a slow process.

      • Cas127 says:

        Based on the March numbers, it looks like April transport volumes might be off 20 to 25 pct (if latter March lockdown was loose, maybe 35 pct).

        Since the 2009 post bust metrics fell 15 to 25 pct year over year, I am surprised that volumes have not fallen more.

        Maybe there are transpo scheduling lags.

      • Debt Wazoo says:

        Indeed. I suspect the plan is to open my county (Grays Habor) soon, among the first wave: starting tomorrow ANYBODY in this county who works outside their home can get a drive-through virus test. Don’t need to be a health care worker.

        Why us? We’ve had by far the lowest number of cases (12) of any (semi)-industrialized county, and the other coastal counties all rely on us (Aberdeen mainly) since we have the rail line, four-lane highway, and deepwater port.

      • char says:

        Or the virus is exterminated. The most likely process and not that difficult to obtain.

        • Winston says:

          You mean like the common flu viruses have been eliminated? [/sarc]

          Coronaviruses mutate, too. We can only hope and pray that SARS-CoV-2 mutates to a less deadly and communicable form and not in the other direction…

      • MCH says:

        You know, listening to Newsom’s noon press conference, it doesn’t seem obvious right now. There was a whole lot of hand waving and deference to scientific evidence during his outline.

        This sounds really good, but good scientific evidence would indicate that the current lock down is great for tamping down the virus. I’ve seen a couple of scientific comments about having a good lock down for a year or more to really reduce the threat, they are probably right if we just look at things in isolation.

        I am pretty sure the world would not survive well in that state. The evidence pretty much shows it. We’ll see how much demand destruction will occur when everyone is locked up, for better or worse, we’re on a self-perpetuating downward spiral at the moment, and even if we open up tomorrow, I think those millions who just became unemployed will not get their jobs back for months.

      • Stuart says:

        “ Some “ being the operative word here. I live in Las Vegas and the panic buying continues unabated. It has been several weeks since I saw any rice, beans, pasta or paper products in any of the three stores I shop in. People here are “ freaked out “, to put it mildly. Even in the event of May or June reopening of the economy the damage has been done. It is going to be a long time before we return to normal, if ever.

    • nick kelly says:

      I just had a nasty jolt. Today the word ‘baseball’ cropped up and I thought how nice it would be to escape all this shit into the timeless world of baseball. We’ve cut back on cable (with net it had hit 200 pm) but I respectfully submitted to Fuhress that I needed some BB and could cough up out of my poker budget ( idle since game suspended)

      ‘Nick’ she said, ‘there is not going to be any baseball’

    • M says:

      I am afraid that this havoc will continue, since it is not even clear if surviving a coronavirus infection is enough to guarantee immunity if you are infected again. Moreover, the antibody tests in the US, which theoretically would tell you if you were infected and have antibodies against this coronavirus, are reportedly unreliable. See

      If the economy cannot reopen, and the wise, rational governors of the most populous states have indicated that they will not listen to our rash, central executive, the economy will keep going down. Of course, it will also go down more if a rash re-opening causes a massive explosion of cases in our most populous states.

      The California governor’s plan explains exactly what is needed to avoid that explosion in each state, which is testing, tracing, etc. However, we will not truly be not in a position to follow that plan in most states for months.

      The anticipated peaks of infections due to explosions of cases in states that have not locked down or have too many exceptions will be additional weights dragging this economy to the bottom for many months — maybe to 2021 because of infected persons fleeing to uninfected-controlled states just recovering from prior explosions. Except for necessaries and unusual consumer whims to calm nerves, like sun glasses, I predict purchases of most consumer goods will dry up as most consumers have less and less disposable income available.

      On the plus side, maybe the Chinese communists will be driven out when their economy is flushed down by the lack of demand for most of their products in a collapsing world economy. However, that is like being glad that a serial killer will drown because the ship that you and he were both sailing in is sinking.

    • The car insurance companies.

  2. Crush the Peasants! says:

    Where is my drone delivered pizza and bottle of primitivo, dang it?

  3. Wisdom Seeker says:

    There has rarely been a better time to have the spiritual peace brought by religious faith, but rarely a worse time to hang out in a crowded church.

    Just reading about Virginia pastor who defied distancing orders, saying ““I am essential. I’m a preacher — I talk to God!”

    While God moves in mysterious ways, it’s tempting to conclude that this pastor was NOT essential, since he caught the virus, and is now dead.

    Darwin Award?

    • Michael Gorback says:

      I believe one requirement for the Darwin Award is that you don’t take other people with you so if any of his followers died of C19 he’d be disqualified.

      As for being essential, Charles DeGaulle once said, “The graveyards are full of indispensable men.”

      • Wisdom Seeker says:

        Taking out innocent bystanders is not allowed for a Darwin Award, nor would coercing anyone who would have chosen not to be a victim – but this guy’s followers were not innocent bystanders, they were greater fools. So, extra Darwin Awards all around…

        • p coyle says:

          how many innocent bystanders can dance on the head of a pin? how many greater fools? and most importantly, how many bag holders?

      • Gerrard White says:

        The distinction bandied around about divisions into essential and inessential are not only misleading but inoperable, seek to generalise what can not be (Church is considered essential by some, not by others) and leads merely, or is merely the expression of, ruling class divide and rule

        Many say travel to be with family is to be considered inessential – but if practiced by one and all for any length of time result in fewer childbirths in an already declining birthrate etc (let’s not even consider emotions and so on)

        One can say that what sounds easy to say, most been talking as if the distinction is perfectly obvious, winds up the reverse

        Deriving forms of life from poorly framed concepts ‘derived’ or supposedly so from would be hard headed economic calculations is a feeble way of organising society

        A sick society is one in which all are tainted by sickness – thinking straight in such a place is very tough, it may be said that best thought is not to be done in prison – however, a society which solves a problem with internment is not competent to decide a future without

    • polecat says:

      He was rapt ready, I guess.

      I’m quite sure that the virus had no preference as to his religious beliefs.

      If Everything is God, GODS, Goddess(es), demigods (of devine leaders one can take their pick!) …’Creation’ … then why not consider a virus, lethal or otherwise, as part of the above, willfull devine action??

      The only other option, is simply ‘chance, snakeyes, magic8ball, reaping a whirlwind, JACKPOT, your place HERE in the multiverse …’

      • paul easton says:

        I guess you were kidding but I am religious and I believe the pandemic was a gift from God. We were at the point where it would take a miracle to avoid truly disastrous climate change, and we got one. I am pretty confident that God will let us survive.

    • KGC says:

      He was called home…

    • M says:

      I have always contended that God has a sense of humor: this Virginia apparently pastor proved it.

      • paul easton says:

        Of course God has a sense of humor. He loves to play practical jokes. See Numbers 11 for instance,

    • Dan Romig says:

      Johnny take a walk with your sister the moon
      Let her pale light in to fill up the room
      You’ve been living underground
      Eating from a can
      You’ve been running away
      From what you don’t understand …

      She’s slippy
      You’re sliding down
      She’ll be there when you hit the ground

      It’s alright, it’s alright, it’s alright
      She moves in mysterious ways

      If you want to kiss the sky
      Better learn how to kneel
      On your knees boy

      “Mysterious Ways” -U2

    • Portia says:

      Those preachers are having conniption fits because the big services are where they pass the plate and get the cash. SMDH. They’ll kill the flock for short-term gain, they are very bad parasites.

    • Calvin Tompkins says:

      hummm, my BS alarm went off after reading that comment wisdom.

  4. Just Some Random Guy says:

    S&P500 is down only 15% from its February all time high.
    The great crash of 2020 isn’t so great anymore. Dow 30k by year end is more or less a given. Anyone sitting in cash right now hates making money.

    • Wolf Richter says:

      Just Some Random Guy,

      Get your mind out of the gutter. Are stocks the only thing you can think about :-]

      • Root Farmer says:


        Your compass keeps me coming back and brings more meaning to your articles.


      • Raymond Rogers says:

        Sad to say he is probably right.

        Found this site. You can actually control the rate of printing. Click on the color bar to adjust speed. Not sure if it is seizure compatible.

      • Nick says:

        Methinks JSRG is pulling your chain.

      • Just Some Random Guy says:

        Not the only thing.

    • dr. gerbs says:

      Optimistic you are. Dead cat bounce….it’s crashing all the way down to 13K DOW because the Big Boys need to buy up everything 10 cents to the dollar.

      • lenert says:

        The Panic has passed. The Discouragement is yet to come.

        • Cas127 says:

          Have not even seen 25 pct of affected financials – just to date!

          Won’t see at least at least 50 pct until end of July.

        • Social Nationalist says:

          Sure, by the 3rd quarter, the market will be grinding down to the panic low, the chicken little’s who post on this board will be nostril flaring. I could see this board whining in May of 1930 as well.

        • p coyle says:

          i forget: does the disillusionment come before or after the discouragement? because it is coming too.

      • Just Some Random Guy says:

        Not optimistic. Realistic. When the govt infuses $2T into the economy, nowhere to go but up. And $2T was just the begining.

      • Frederick says:

        So that would mean DOW 3k Doc

    • SocalJim says:

      About 3 or 4 weeks ago, I said this would be the fasest V shaped recovery ever seen … the stock market sees the same. I thought the SP would drop about 10% more than it did … the FED came in faster than expected. There is a decent chance that this could all unravel, but odds are less than 1/3. A partial reopening of the economy is already in the cards, and the market expect the president will win re-election … this is the fuel.

      • SocalJim says:

        Also, I am looking to accept a major wall street position, and if that happens, I will disappear from here. In mid March, they called me and asked what I thought of the markets. I told them the spring weather would tame the virus in about 4 to 6 weeks, and I also told them the market was going to rally very hard. They thought I was nuts. I wonder what they think now … I will be talking to them again shortly. I think this problem comes back after the 2020 election with fall weather …

        • Auld Kodjer says:

          I said
          I thought
          I am
          I will
          I thought
          I told
          I also
          I was
          I wonder
          I will
          I think

          Ay ay ay, Jim.

          But I hope you’re right about the V shape.

        • Frederick says:

          Good luck with the pitchforks I’ve heard they’re real painful

        • A Citizen says:

          The beauty of markets is one can trade both ends of the tape.

          Unfortunately there are those who think trading should be banished along with the rest of the economy at penalty of the pitch-fork wielding Socialist mob.

          Good luck in your new role.

        • neplusultra says:

          lmao sure. In times like these, it helps to daydream a bit. Good for you.

      • Social Nationalist says:

        The market expects a presidents reelection… Stop posting. Damage to credit markets will take a few years to recover and state wide rules will slow recovery. Sadly, you don’t get that. What weak minded fool.

        • Just Some Random Guy says:

          Trump is the favorite to win on betting sites.

        • Tom Pfotzer says:

          There are many different ways of disagreeing. One great marker of character is to be able to disagree with grace and panache. This was one of Ben Franklin’s greatest traits, and one reason he was selected as Ambassdor to France at the cusp of the American Revolution.

          Plesae have a care about name-calling. One thing that makes WS so good is that people can somehow leave the corrosive internet bad manners elsewhere.


          JSRG may very well be right about the $2T stim-drugs, and more to follow, bringing another massive re-flation. The U.S. is very large, very rich, and is still the global main-game-in-town reserve currency. There is massive monetary destruction in the real economy to offset any monetary injections in the financial economy.

          So the market most definitely can re-flate again, the only question is how much does it take to get how long a re-flation.

          It would be great if we got another re-flation. These near-death experiences are helpful for those (few) of us that are able to use feedback, and maneuver out of the way of falling buildings.

          To date, I am not yet one of “those few”. I hope you are.

        • If the president is reelected it means the economy recovered, if you trust corporate America to protect you from the virus, or any other exogenous threat. The crisis exposed the soft underbelly of Neoliberal policy. The previous notion, that corporations keep the profits, while taxpayers back their losses, has been replaced by “you die, we profit.” The bizarre handstand Bill Gates is doing does nothing to reconcile big business with their Darwinian code. Now they want to track you down to see if you have the sniffles.

      • rhodium says:

        But what if it’s a VWLJ shaped recovery that occurs over the next 2 years?

      • Jdog says:

        Actually Jim, the v recovery early in the 1929 crash was faster, and we all know how that one ended…….
        Current valuations are stupidly high even at the best of earnings, which we all know now will never happen.
        I know no one cares about valuation any more, but they will, you see they just ran out of greater fools……..

        • SocalJim says:

          Valuation … it depends on how you look at the market. Using the best valuation method out there, which in my opinion is the CFROI from the Holt model, you will see a market level CFROI is about equal to the treasury yield plus a reasonable risk premium. One can always debate the size of the risk premium and the duration defining the treasury yield selected, but a strong case can be made that the equity valuation is within 1 standard deviation of fair.

        • A Citizen says:

          In 1929 the Fed made MAJOR policy errors. Comparing the current tribulations to 1929 will cause very poor decision making.

      • Frederick says:

        Wishful thinking Real Estate brokers are always that way I always try my best to sell/ rent on my own through the internet though

    • timbers says:

      You may be right. Because none of these recent Fed actions are temporary. All of them are and will become permanent. Which is distressing. Please stop confusing that with anything the WH is doing.

      • Social Nationalist says:

        Like they matter. They didn’t do a thing. This panic wasn’t caused by balance sheet worries by commercial banks. But by lost production and sales due to a weak economy shutdown by social distancing.

        • timbers says:

          They not only matter in determining stocks going up, they are the Ultimate Power In The Universe. Fed QE is the ONLY thing that matters bin stocks going up.

        • p coyle says:

          yikes i must be out of the loop on this. i was completely unaware that social distancing had started in september of last year.

    • Jdog says:

      30K? LOL Having your money in the market now is like having it in the toilet, it’s going to get all flushed away…

    • Timothy Lewman says:

      Check gold price and miners. Serious rally, buy on a pull back if we get one.

      • p coyle says:

        comparing gold price to miners is like comparing batting average to rbi’s. there is some correlation, but…

        and as far as gold miners go, the pullback already happened a few weeks back. no serious rally, more like a getting back to “new” normal.


      • Frederick says:

        Indeed I fully intend to do exactly that Tim

      • Mikey says:

        Miners usually massively overpay for other miners at the peak

  5. Anthony A. says:

    We have been eating at home for a month now (two 70+ year old retirees) instead of frequenting local eateries, which we did very frequently, and liked to go. We have $2,000 left in the checking account that was not spent last month!

    We are loving this lockdown!

    Our local Walmart had tall stacks of TP next to the checkout area today! Looks like the TP shortage is over with. Trucks must be getting the loads.

    • CrazyCooter says:

      Had this same conversation with a dear friend of mine down south (he told me the list of stuff he is saving on by working from home) – keep in mind monetary velocity – that 2k you would normally spend is someone elses revenue, wages, grocery money, rent, etc.

      Saving money is generally a good thing, but as all things too much of a good thing is a bad thing. People are being *forced* to save (by not being able to spend); it some will benefit, and others bear a burden.

      Enjoy the savings, but be aware of the burdens it creates for others.



      P.S. I am saving a boat load on lock down too, but know many people out of work with significant others, kids, pets, etc – so I want to see them have a chance to get back to work ASAP.

      • Anthony A. says:

        Believe me, if the local eateries were open, my wife would ask that we forgo her “cooking” and go out. At 75, I think she forgot how to cook as the stay at home meals are not that great. But, heck, I forgot how to mow the lawn, too!

        But the savings is nice and as retirees with just “enough” to get to the “end”, we are OK with the present situation.

  6. tom says:

    I didn’t bother to ask Mr Gates or F*cki if I could continue to work.

    I have to. All my fellow comrades obeying & reporting violators
    have hoarded way to much toilet paper. While they may be happy doing 30 days in the hole….their septic systems are not. So if you have an older system, or undersized for its current use…..might want to use a little water conservation and/or call a pumper. Or let the good times continue…and keep me employeed.

    • p coyle says:

      well, you can console yourself by imagining a world with less food consumption, thereby less toilet paper use, thereby less constraints upon septic systems. it does lead to an imagined world with a whole bunch less people in it, something mr gates may or may not have a financial interest in. in any event, i doubt it bodes well for either or us.

  7. Michael Engel says:

    1) Cass Freight Index ROC is negative for x2 years.
    2) Apr/ May decline will be worse.
    3) In the second half of 2020 there might be some recovery, but for
    a long period it will be underwater.
    4)1987 was’t an economic collapse.
    It took almost x3 years, til May 1990, for the Dow to recover, to exceed the 1987 high.
    5) If Cass will improve in the second half of 2020, it will be atypical to any other year in the last decade. Cass usually peaked in the first half, before fading away for the rest of the year. 2020 might look like 2009, but 21- 24 will not be a normal recovery.
    6) One day just in time will be just in time. It will not come from China with half a year delay.

    • Joe in LA says:

      I hope you anthologize these comments some day. They are like a mixture of abbreviated weather reports, gnostic pronouncements, and the occasional koan.

      Up and down the wayward monkey.

  8. Michael Engel says:

    cut paper towel roll with a scissor x2 lines for x3 toilet papers rolls.

    • DR DOOM says:

      Fed has nationalized the entire economy. The SPV shreds the limits of it’s charter from congress . Congress will be moot .The free market , or what was left of it is dead. No creative destruction via bankruptcy means a constant winter with no chance of spring. Wall Street and its accomplice the fed with congress in the pocket will continue to enrich its selected few whom have access. All I can do is stay healthy which for me includes having no debts. Own my home without a mortgage. Drive used vehicles . Buy staples and not junk food. Stay in cash. I am sure all the smarter people who understand the stock market and have faith in the stock market and the fed will accumulate much more than me . I want to sleep at night and wake up in the morning and enjoy my field of pink dogwoods blooming before they fall . To hell with this Keynesian debt ridden consumption at all cost nightmare.

      • MC01 says:

        Yet the world’s largest cruise line, whose CEO is a close personal friend of the President, is eligible for exactly $0 in bailout money and its shares are down for $132 in January to $37 right now.
        That’s a pretty lousy “nationalization”.

        Article coming up very shortly. ;-)

        • DR DOOM says:

          MC01: if the POTUS pal would have flagged his ships with the US flag he would have a bail out. Instead his pal flies the flags of Malta , Pamama and the Bahama’s. His pal does this to operate a sub standard cruise line relative to US Maritime Standards. Flying the Flag of Convenience of foreign governments with little regulation is as of date outside the reach of the. Fed printing press . Don’t fret , the Fed has other ways to inflate the assets of its connected few.

    • p coyle says:

      best investment advice. ever.

    • VintageVNvet says:

      ROFL ME,,, Best one yet!!
      Thank you for being you and, besides teaching us all Engelish, a heck of a lot more about ”stuff” especially TP!!

  9. Paulo says:

    This snippet was interesting:

    I’m posting just this one sentence: “there was proportionately less and less cash in the hands of buyers to carry the goods off the market. The pattern of income distribution, in short, was incapable of long maintaining prosperity.”

    My question for all the Stock Market boosters. What percentage of the population has a bunch of cash around to purchase goods to kick start the economy when we start to ease up on the lockdowns?

    There will be no V shaped recovery because regular folks have not shared in the recent prosperity, beyond access to debt. And now, every country in the world is in debt up to their ears trying to fend off a collapse. When there is a vaccine, will there be a boost up on the hope? Of course. Will it last? How can it. The furniture has been burned to stay warm.

    • Tom Pfotzer says:

      I second Paulo’s remark. The 50-year phenomenon we’re getting squashed by is the increasing income gap, which results in an increasing wealth gap, a massive concentration of wealth… whose root-cause and fundamental linch-pin is the concentration of income-generating capacity in the hands of a relative few.

      There is nothing monetary policy can do to change this. Delay the effects, yes; change the outcome…no.

      What about “Fiscal Policy” (gov’t spending programs) ?

      Well, if your government is owned by the people who control the wealth-generating capacity, can you really expect that Government to apply resources in a manner that equalizes the wealth-generating capacity (e.g. actually addresses the root of the problem)?

      Probably not. For many reasons, and, sadly, most of those reasons are the “victim’s” fault.

      I have decided to “look within”. To use RD Blakeslee’s term, I’m going to “build my micro-economy”.

      I am learning how to substitute goods I produce for goods I would ordinarily buy from the market, and I’m learning to substitute expensive “wants” for cheaper “wants”. “Wants” are the easiest thing to substitute away.

      This causes monetary velocity to fall even further. That’s bad. It is a strategy that nearly all people could use, though. That’s good.

      Should I allow myself to get squashed by the concentration-of-wealth steam-roller, or should I get out of the way while I still can?

      • RD Blakeslee says:

        Congratulations, Tom!

        If you haven’t discovered it already, it’s not like putting yourself in prison. It’s living free of “the other man’s” expectations.

    • VintageVNvet says:

      And I will ”third” Paulo’s this time, with one very big exception:
      In at least the FL RE market in 29, a good part of the problem was that the so called velocity of money, RE transfers, etc, had gone to Mars and beyond, with old timers telling me in the early 50s of some properties changing hands three or four times PER DAY…
      Crazy is as Crazy does, and that time was crazy, as clearly was the same RE market 06-08 (in various areas of USA that time.)
      Certainly appeared to me, sitting on the sidelines of the SM the last 6-8 years, the same thing had happened, and the result seemed inevitable, as does the result of any such madness.
      Time and enough to take a trip both back to basics and forward to the much more clarity of markets based on much more commonly available information all over the internet for anyone to use, as opposed to the very very limited availability of information of older days, especially when the robber barons of old more of less monopolized the information and were able to manipulate the markets accordingly.

    • Jeff says:

      V Shaped recovery?

      If the government doesn’t do some serious creation of money for normal everyday American Citizens, it’s going to be an

      L Shaped recovery.

  10. zappalives says:

    I would like to comment here but……….will that gandalf chew my head off if I say something he doesnt like ?

    • p coyle says:

      perhaps. if not, surely someone else will step into the breach.

      • VintageVNvet says:

        What a Thread!! You folks are going to expedite my death from laughing so hard,,, ROFL, etc., etc…
        Great one PC! Thanks,,, cough cough
        Yeah,,, c’mon zapper,,, get it out here and enjoy the dicing, if for no other reason than the reasons you get back?

    • Tom Pfotzer says:

      Why in the world would you care what Gandalf does? If you’ve got something constructive to say, let it rip.

      Gandalf does it all the time. Why not you, too?

  11. Jdog says:

    People just don’t seem to get it. The disease the economy has, is not the virus, it is the underlying debt. The economy was showing all the signs of recession before the virus, and the virus has now supercharged the problems.
    We are only a few weeks in and there are already reports of people tapping their 401K’s.
    Sure in a few weeks most people who still have jobs will try to go back to work, but they will find that most everything has slowed to a crawl.
    The robust recovery that business needs to recover from weeks of hemorrhaging money simply is not going to happen and most will find it hard to even make enough to cover expenses.
    Cities and businesses who depend on summer vacations to make their year are going to suffer terribly.
    By next fall, reality will set in, and if we get his with a second round of virus in the winter we are truly screwed. These things tend to come in waves, and we have only seen the first, and are not even able to calculate the damage from the first wave yet.

    • Shiloh1 says:

      RE “tapping their 401Ks”

      While employed one can only borrow from 401K. When separated from company one can take control and / or cash out. If I recall correctly the IRS tax penalty for early withdraw ceases after age 59.5. State of Illinois, and perhaps others – does not tax retirement income – at the moment.

      Disclaimer: I am not a financial adviser, do your own research.

      • David G LA says:

        Corona care – 10 percent penalty for withdrawals suspended for first 100k.

      • Wisdom Seeker says:

        They made special rules for COVID. If you have a 401K and need access to the cash in this emergency, do recheck the current situation.

  12. Michael Engel says:

    1) Testing, testing, testing. We cannot evaluate and grad without testing. Diagnosis is important, but testing extrapolation is a wasting money. Instead of investing in the real economy we shoot at moving health targets.
    2) Suppose each test cost about $1K.
    3) 350M x 10 tests/year x 1K/ test = 35 x 10^11 ==> nuke my steakhouse to stat the economy. What is next, after the tests, order Big Mac in MCD ?

  13. David Hall says:

    Fear is the worse enemy. On the Diamond Princess cruise ship 7 out of about 712 testing positive for COVID-19 died. The cruise ship passengers were mainly older. Those who died were over the age of 70. Almost half of people who tested positive were asymptomatic.

    • Pedro says:

      So if all Americans get covid – which is likely – then 1% will die roughly speaking. Ok maybe less since cruises have disproportionately older people. So let’s say 0.5% Conservatively . That means 1.5million Americans will die (330m pop)

      • DawnsEarlyLight says:

        No, once the population reaches the percentage of herd immunity, the virus should burn out due to not enough new hosts to keep replicating. If the susceptible stay quarantined/lay low, then there are enough people to reach that percentage, with minimal casualties.

        • char says:

          Herd immunity is not possible. Too many people will do self quarantine You need the susceptible population to be less than 1/R0. A very simple model and as such wrong for medical advise. 1/4 youth, wont get the disease. 1/4 between 20-40, can become immune without to many problems. 1/4 40-60 not wise to get the disease. 1/4 over 60 Should be quarantined.

          But R0 is such that almost everybody below 60 needs to get the disease. for herd immunity to work. But there are a few big problems with that. a) You need to get almost everybody but chance will make it that not everybody gets it. b) a lot of 40-60 will self quarantine c) It will take an awful long time d) You loose immunity after some time e) It takes so bloody long that you need to incorporate the normal flow of deaths and births.

          In short herd immunity would take years. Regional hard quarantines work to and cost less.

        • Pedro says:

          I don’t think you understand how statistics work. If 0.5% of people who contract the virus die (which seems to be the accepted rate by epidemiologists) then 1.5m Americans will die of all get it – which is likely over time.

          Flu is 0.1% and only about 1/5 of the population gets it annually. Which is why we see 50k die annually.

        • Iamafan says:

          Herd Immunity ???

          Are we immune from stupidity ???

          Can you give me an example of herd immunity without the use of vaccines?

    • akiddy111 says:

      Were the majority of those who tested positive on that cruise Japanese ? Would love to know.

    • td says:

      Eleven have died so far and ten are still in intensive care, unlikely to survive after so long. So it looks like about 3% of an older cohort. Remember it takes from two to five weeks to die of this thing and some take a lot longer.

  14. George W says:

    3 Day Notices To Pay Rent Or Vacate are increasing.

    I delivered to a really nice upscale apt. complex in downtown SLC today.
    About 5% – 7% of the apts. had folded over letters taped to their doors.

    I knew what they were about. What I didn’t know was when the notices were posted or how many had already been taken down by the current occupants.

    Everyone is still acting civil but it is not likely to last.

    • George W says:

      Some of the other apt. complexes I delivered too had no notices posted at all.

      All the leasing offices were closed which makes accessing high security complexes a real pain.

      • Shiloh1 says:

        Landlords and tenants should share axes and pitchforks when attending the local
        Property tax body meetings. Be sure to wear masks. I know of no government worker who has missed a paycheck.

        • timbers says:

          Better yet, don’t wear a mask…the Public Officials will RUN from in abject horror. You’ll be The Man.

        • Jdog says:

          States are going to be in real financial trouble between massive unemployment claims and steep drops in sales taxes.
          They are going to have no choice, they are going to both raise taxes and cut services. That is really make people angry.
          If my guess is right, they will do as they did in the great depression and go after higher income taxpayers first and try to slowly work the lower income brackets in gradually.

    • Pedro says:

      Maybe they were just maintenance notices? Or notices about covid prevention measures? I doubt an upscale apt complex would have that many people not paying rent. The upscale Tennant’s are likely in industries that are not restaurants or bars etc.

      • George W says:

        I have seen many maintenance and preventative letters posted as well, they are never folded over.

        This was not your typical apt complex in Utah, it’s likely the rents were at least 2,500+.

        Your right the remaining 94% likely work for the Local, State or Federal govt. and won’t be effected.

  15. Las Vegas Frank says:

    I write this after standing completely alone in front of the fountains at Bellagio knowing in my heart that America will never be the same. It is serene and beautiful to see and hear the thousands of birds and other wildlife beginning to frolic around the mega resort properties on the strip. The air is now very crisp, clear and beautiful. What will we do with these 160k hotel rooms here in Vegas ? I am not sure what will happen to this place which in my opinion is the shadow capital of the country.

    We need to stop pretending like we were a healthy ,happy country before the virus.

    4.5 million on probation/parole
    2.3. million incarcerated
    68k opioid deaths
    47k suicides (2nd leading cause of death)
    19k homicides
    11k killed by drunk drivers
    50 percent of all households with zero savings.

    And now this…….

    The powers in charge of this country need to ask every American just one question.

    What in your life are you most proud of ?

    If you have been one of the bloodsuckers that’s has done nothing to help yourself, your friends, your family, or your country perhaps your time has come.

    If we can survive this virus without the red generals in China making this place their empire in the west ,it will be a miracle.

    • Escierto says:

      I am most proud of my seven children (all college graduates) and the new generation of seven grandchildren. Every day with them is a day of joy and happiness.

      • Pavilic says:

        49 grandchildren.
        Do you all live in one house and share one vehicle?

        Does your family deserve more than one load of food from the food bank? If so why?

    • Phoenix_Ikki says:

      You forgot that most American rather pretent to live in this American dream fantasy rather than face up to reality to all the issues we have on hand even before the virus. The willful ignorance of forever blind optimism is so prelevant, the “negative” people that point to the truth or acknowledge the deep problems within our society get riducule for being too pessimistic. The urge to go back to the “normal” way of life is so in grain in the general herd and even in a middle of a pandemic, people are betting on everything back to normal in couple of months. Nevermind that a vaccine in 18 months are highly aggressive and optimisitic target within the medical community consensus. I guess that’s what you get when you are another cog in this thing we call American Exceptionalism.

      • CRV says:

        I get you. We have to think about if we really want to go back to the old normal. Was it really that great?

        • Portia says:

          The old normal was not some static thing–it brought us here. There is no such thing as normal, it’s a progression of events that is still unfolding. There really is no beginning of anything, and no end. That’s why buddhism emphasizes giving up attachments–they keep you from seeing the trends of events.

    • Shiloh1 says:

      Somehow Vlad is able to run his little shop with no debt. What’s his secret?

      • p coyle says:

        i will take “what’s thinking about two quarters ahead for $500” alex.

      • Saylor says:

        Easy, kill your opponents.

      • Trailer Trash says:

        1. Much of the Russian parasite class moved to London.

        2. The Russians want to defend Russia, not rule the world, so they have no need to spend a trillion dollars a year on war and “security”.

    • Anthony A. says:

      “If we can survive this virus without the red generals in China making this place their empire in the west ,it will be a miracle.”

      Eventually they will be here (in some form) and then the junk to be bought by us ‘mericans won’t need to be shipped so far.

  16. Aussie says:

    Western Australia today the first time with 0 new infection. The most of our cases came from cruise ships. Still no announcement
    when the lock down will be liftet. I assume latest end of april.
    I just posted the nikkei index to friends to explain what the future will bring. Stagflation. See Nikkei from 1989 on !

    • Pedro says:

      Very optimistic thinking. The virus doesn’t just vanish because everyone is hiding in their den. When people come back out will start to replicate again until herd immunity is achieved.

      Stagflation is a symptom of excessive money spending with limited supply. We don’t know yet if people will be spending at all for months or years. Govt stimulus checks to the people could just be saved or used to retire credit card debt. That’s deflation

  17. Mike R says:

    I love the facts that Wolf reports here. Meanwhile 99% of all Mainstream Media is absolutely TERRORIZING every US citizen with ad nauseum horror stories about how bad Covid 19 is. 24/7 they cherry pick the worst of everything. This despite the fact that a multitude of reports and studies are showing the death rate is most likely well below 1%. Quite simply, nowhere near enough testing is being done, and millions of cases are simply never being captured, as millions are either asymptomatic, or their symptoms are so minor they have no idea they had it, or have it now.

    • Frederick says:

      Why would any semi intelligent person waste their time watching nonsensical propaganda anyway Mike I haven’t watched that stuff since 2001 after seeing the BBCs coverage of the demolition of building 7

  18. roddy6667 says:

    Anybody with a reefer trailer that is not working should go to the nearest large city and rent it out to a hospital for storing bodies. The morgues are full.

  19. S says:

    The new operative words after the lockdowns: “Pent-up demand”

    That should be good for 4,000 Dow points.

    Just don’t say “Green shoots”. That is so 2009.

  20. MC01 says:

    There are presently whole fleets of container carriers moored around the Pearl River and Yangtze deltas waiting to load their cargos and start their journeys towards Europe and the US.
    It takes 12 days from Shanghai to Oakland and 30 from Shanghai to Rotterdam so shipping companies want to be sure their ships will be able to unload their cargo and take on new one when they get to destination: the queue in front of Fos-sur-Mer (tankers and LNG carriers “stranded” due to the complete collapse in demand for energy products in France) is getting too long for comfort and nobody wants a repetition of it.

    Trucking companies and to a lesser extent railroads will have to tighten their belts until those container carriers get here, but that completely depends on the political will to start reopening our economies. This is not a healthcare crisis anymore: the true emergency right now is not merely restarting, but restarting quickly enough to avoid all the damages wrought until now to become permanent.

    • timbers says:

      I like your point that we must start re-opening the economy NOW in safe ways. Much too little effort going into that.

      And we have trigger happy leader in the US who I expect will do it the wrong way.

      For example, my work just finished a re-design of it’s office space. The once popular “open” work space were no one had their own desk and no barrier between you co-workers sitting right new to you.

      Time to go back to the “old” way when you can’t work at home.

      That’s so 5 minutes ago ancient history now.

      And sadly, the prior workspace had 5ft tall cubical separating each employee with more generous space easily complying with social distancing.

      All that money down the drain.

      I work part time for fun at Boston Symphony Orchestra. They’ve been aggressive about extending shut downs and recently cancelled a performance beginning early June. To re-open, they will need to reduce seating by spacing allowed seats our sufficient distance. The bars and restaurant areas will to host fewer guests and bartenders instead of 2 per station, just 1.

      All these things will need to be done, just like they are doing it in grocery stores now. Airlines, doctors offices, etc.

      It can be done.

      Start doing it NOW. Slowly, with thought, maybe trials at first.

      Open the economy NOW. It a safe way.

      • Jdog says:

        The economy going forward is going to be very different, there is no going back to where we were.
        As I see it, the commercial real estate market is going to be ground zero for what happens next. We are probably looking at the permanent closing of at least 25% of restaurants and taverns. Hotels and retail are also going to have huge numbers of bankruptcy’s and closures. This is going to mean massive numbers of mortgage defaults
        Debt based economies are sustained on confidence as most spending is based on future earnings. When people are not confident about the future, it is going to impact their purchasing decisions.

      • A Citizen says:

        “Much too little effort going into that.”

        You really have not one scintilla of a clue.

  21. Michael Engel says:

    1) A researcher on his lab bench, bending over a microscope,
    inspecting virus mating and mutation all day, will become detached from the outside world.
    2) The global central bankers who created NR and underwater inversion,
    sending bond prices higher, are spaced out.
    3) When Paul Volker “animal spirit” will be back in the Fed, high bond price fads will plunge below their intrinsic value, sending bond rates much higher to delete. debt.
    4) Gold is cup and handle, but the handle is missing.

  22. Michael Engel says:

    1) Climate change sent arctic air to Omaha NE, tempting WB
    to probe OXY.
    2) In 2000 PE ratio was > 40. WB didn’t spend a dime.
    3) In 2009 PE ratio was 13, WB never stopped feasting for free.
    4) In 2020 oil co PE is low, but S&P EP is still too high.
    5) WB > 90. Munger > 100. Covid19 will skipped Omaha and LA alike.
    6) Both have at least 20 years to play and invest in the stock markets.
    7) WB probed the oil market, because oil is ugly today and will become
    uglier. Therefor Houston oil will hide in the ground, until few
    investors will realize that climate change sent arctic oil to NYC
    and SF and oil will become beautiful again.

  23. My macro view is that the financial destruction of America will be the economic rebirth. At the turn these truckers will be hauling America’s freight.

    • VintageVNvet says:

      Don’t disagree with your comment, ”At the turn…” AB, How some ever, maybe it just might be possible going forward ”from the turn” to have a more rational distribution and delivery system based on the most efficient methods.
      USA has had serious shortages of drivers of big trucks, increasing every year recently as the folks who got the trucking industry started to big time in the last 50 years or so have retired and/or died off.
      Having known a few long haul driver neighbors whose careers were extensive, both as employee and owner/operator, I can verify that the health challenges alone made it a career of last choice for most of them; and I can also testify from first hand experience driving across USA on 10, 20, 40, 70, and 80, 10 times last five years, that there are clearly way too many big trucks clogging the interstates everywhere, clearly not what those roads were designed for originally.
      So, going forward, most land freight, ALL of the really non-perishable, should go by the most cost effective way, train; and most truly perishable should go by the most speed effective, air, (( with the very real benefit that much more produce could be harvested ripe and actually eatable instead of the current situation, with most being picked way too early and taste and texture more like cardboard.))
      Trucks for ”specialty,” regional, and local distribution and delivery make sense re cost effectiveness, otherwise, not so much; and that is even before any consideration of the real life cycle cost of manufacture, maintenance, and especially fuel, currently subsidized.

  24. Las Vegas Frank says:

    400 Million youth in China under 24 years of age most of which are studying math and science largely unaffected by COVID 19.

    230 Million of them are MALE S immersed in English training programs mandated by the CPC.

    In the mean time we continue to focus on fighting with each other.

    We continue to focus on the critical , nation building issues

    filing 40 Million lawsuits against each other in 2019,
    not to mention arresting 13 Million Americans obviously because they know how to behave so well.

    If we don’t get our heads out of our asses SOON and I mean SOON everyone had better pray for a Chinese Communist Party collapse or start learning to speak mandarin.

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