Halls of Shrewd'm / US Policy
No. of Recommendations: 10
The U.S. freight market is starting to roll over as Chinese trade plummets.
"We are now forecasting nearly a 16.6 percent year-over-year decline for U.S. imports in December, after a 12% decline in Q3," said Ben Tracy, vice president of strategic business development at real-time container tracking platform, Vizion. "There is no bounce back in sight," Tracy said.
Retailers and manufacturers have put a pause on robust freight orders because of fears of a consumer pullback due to food and consumer product inflation. The picture from retail earnings this week has been mixed, with downbeat reports from Home Depot and Target but strong results from Walmart, which said more consumers are focused on value, and more of it sales are coming from upper-income shoppers.
"For the first time since March 2023, we're seeing monthly import volumes consistently fall below 2 million TEUs — this isn't just a seasonal dip or temporary correction," said Kyle Henderson, CEO of Vizion. "The data shows this is a structural goods recession driven by the convergence of tariff uncertainty, frozen housing markets, and a fundamental shift in consumer spending away from physical goods," he said. Hats off to the Teamsters, truckers and freight workers who voted themselves into a "structural goods recession" by their 2-to-1 support for Trumpedo. Hope they're enjoying their van truckloads down 11% year over year, refrigerated truckloads down 7% year over year, and flatbed truckloads down 3% year over year.
https://www.msn.com/en-us/money/markets/this-is-a-...
No. of Recommendations: 9
Hope they're enjoying their van truckloads down 11% year over year, refrigerated truckloads down 7% year over year, and flatbed truckloads down 3% year over year.
Yep... between the stocking up to 'beat the tariffs' and the drop off in sales due to trumpflation, inventories are good... freight/trucking suffers.
A recent article in Freight Waves (?) (I follow a few freight reporters)explained how the smaller truckers are harmed the most as distribution centers are jammed with front ordered product, and stores aren't requiring product to be shifted around.
So they buy less fuel, require fewer services, a whole chain of reduced business the public doesn't hear about.
No. of Recommendations: 5
B-b-b-b-u-u-t-t B-b-i-den, m-m-o-o-ney supply...,
No. of Recommendations: 6
"Yep... between the stocking up to 'beat the tariffs' and the drop off in sales due to trumpflation, inventories are good... freight/trucking suffers."
Last google search I did showed that American consumer spending makes up 70% of GDP.
Best I can tell, the majority of American consumers are struggling with the cost of goods and services. And a lot of them are about to get a bucket of cold water poured on them when their health insurance premiums skyrocket in January. They will have even less free cash flow to maintain their standard of living. The stock market seems to be totally ignoring this looming problem, but if consumer spending is truly 70% of GDP, then GDP must contract if the consumers are paying more for everything.
So the stock market can't ignore it forever. But for people like me, blue collar people who learned how to invest their capital and ride the coattails of the wealthy by getting in the markets, things are still going well. But how big a part of the population do we make up ?
No. of Recommendations: 1
This story is yet another example of A.I.'s effect which is not so good.
There is as far as I can tell a single story in which two or three people are quoted as saying there is a structural goods recession in which the tariffs are one of several factors, and probably not even the major factor. The other two mentioned were the problems in the housing market and fundamental changes in what consumers are buying, i.e., they are simply buying less physical goods overall, and that's said to be a permanent change in consumer purchasing patterns.
But this is now all over the internet, dominates search responses. Infinitely self-replicating.
How correct are the conclusions?
Who knows, it's the opinions of a few people in the industry; so possibly well informed; but the emphasis on tariffs is purely a creature of A.I. psyops.
No. of Recommendations: 2
"but if consumer spending is truly 70% of GDP, then GDP must contract if the consumers are paying more for everything."
edit to my own comment. The consumer spending will be shifting. But even if more of
the consumer take home pay is going to health care insurers, and home insurers, etc, the spending is still part of GDP. So maybe GDP doesn't contract ? But the spending will go to different entities. Doesn't bode well for sellers of discretionary purchase products. Does bode well for the well connected sellers of products and services. But is there a downstream ripple effect on the economy when insurance products are sold? There is definitely a downstream ripple effect, as noted by Sano, when products are consumed and repurchased in the course of everyday life.
No. of Recommendations: 2
Patterns of spending are changing.
People are posting about here and on other social media.
Restaurants and even fast food places are too dang expensive.
People are and will be cooking at home more often in the aggregate.
Health insurance went up an average of 26% for 2026. That's not discretionary for most people.
If you have to pay $500-1000 (maybe more) per month for health insurance coverage for your family, that's directly coming out of some other part of the budget.
Health insurance is an intangible non physical "good." So you cut back on unnecessaries like all of the convenience food items that are highly profitable for the manufacturers and stores but cost the consumer a lot of money and have a negative nutritional value.
Things like junk food, sodas, chips, candy, ice cream, alcohol, convenience foods--all of that crap is completely unnecessary to good health and nutrition, overpriced, and if need be can be cut out of the family budget. Bluntly, all anyone really needs as a beverage is water. (I mean I gotta have my coffee/tea for sure but I don't need it to survive.)
That's just one example.
No. of Recommendations: 2
the spending is still part of GDP. So maybe GDP doesn't contract ?
That's what I was thinking. The spending is simply redirected. What are the effects? Government spending goes down. Personal spending for insurance goes up. Result should be a wash for the insurance companies.
The next leg may be SNAP. Government spending for SNAP goes down. Personal spending for food goes up. Those who consume will have less money for, in the example discussed earlier, liquor and smokes. For those without any discretionary money at all, motivation to work more hours, replacing the illegals that are being rounded up.
A whole lot of economic activity, over the last 40 years, has been juiced by drawdown of savings, and accumulation of debt. If the objective was to reduce the accumulation of debt, a lot of consumption would need to be curtailed. It is unhelpful, however, if spending cuts in one sector are offset by increased spending, or revenue cuts, in another sector. That process is "Rant 37": wealth transfer.
Steve
No. of Recommendations: 3
Steve203: That's what I was thinking. The spending is simply redirected. What are the effects? Government spending goes down. Personal spending for insurance goes up. Result should be a wash for the insurance companies.
The next leg may be SNAP. Government spending for SNAP goes down. Personal spending for food goes up.
Umm, what now?
About 25% of those currently receiving ACA subsidies would simply become uninsured, spending nothing.
Children make up about 39% of SNAP participants, senior citizens 20%. Households that include someone with a disability (plus children and/or elderly) receive 83% of all SNAP benefits.
No doubt they'll fill all those jobs now done my migrants in meat packing, harvesting, construction, lawn care, dairies, leisure, and manufacturing.
SMH.
No. of Recommendations: 1
the spending is still part of GDP. So maybe GDP doesn't contract ?
That's what I was thinking.
I can't help but think it won't even out, though I wish it would. People will drop health care to afford basic necessities. I don't think poor people are near all of the jobs, so a limited amount of picking up the slack if you round up illegals. There were plenty of prior instances of crops rotting in the fields. People will consolidate to afford what they could before. But it could. It definitely could, I see and agree with your points.
No. of Recommendations: 0
SNAP spending will not go down. It won't be allowed to go down.
The only reason SNAP even came up on the political radar screen was the Schumer Shutdown.
SNAP spending represents about 10% of all grocery store spending.
There is a huge business and food industry constituency that needs SNAP aside from the actual recipients of the SNAP benefits.
It's the same thing with the free cheese in the 1980's, subsidized lunches in schools, and so forth.
It benefits the nominal beneficiaries, but it also benefits the food/agricultural industries.
Look what happened with the soybean tariffs.
No. of Recommendations: 1
"I can't help but think it won't even out, though I wish it would. People will drop health care to afford basic necessities."
I agree with you and Steve. Is a penalty no longer levied on filers via the tax code if a person can't prove healthcare insurance ? People will have no choice but to drop healthcare in order to afford rent,or mortgage,or car payment etc,etc.
Still see a pullback in consumer spending driving 70% of GDP, though.
Can't spend what you don't have.
Insurance doesn't really seem to have a downstream creation of economic activity like durable goods or consumer discretionary stuff. Insurance has always felt like an economic friction to me, except for the few times when I broke bones and the insurance definitely saved me from big bills.
No. of Recommendations: 2
Commonunist,
You bring up the ACA subsidies which the Dems were whining about as the justification for their shutdown.
Shutdown over, now they are dead silent about ACA, it's all Epstein, all the time.
Were the Dems just pulling your chain?
You betcha.
No. of Recommendations: 2
If there is not enough cheap manual labor for harvesting crops (i.e. underpaid/exploited illegal aliens), agriculture will just end up more heavily investing in automation, to the extent it makes economic sense. If it does not make economic sense, the capital will be directed elsewhere where it does make sense.
Maybe A.I.
Capital will flow towards where the capitalists believe the profits can be found.
Some crops may not be economical to grow without cheap illegal alien labor, and the economics might not sense to invest heavily in automation to replace the cheap illegal labor. Those products will not be grown here or perhaps only in a very "niche" way.
Perhaps unused farmland will be sold to A.I. companies for data center construction.
Perhaps creative capitalists and inventors will figure out new ways to automate that will be profitable on the farm for certain types of products.
Look at the soybeans, we have so many soybeans that if we can't sell to China the market crashes.
No. of Recommendations: 3
Those who consume will have less money for, in the example discussed earlier, liquor and smokes.
Almost all liquor and smokes are consumed by those with an addiction. Due to the nature of addiction, crime will increase before spending in this area decreases.
Alan
No. of Recommendations: 1
Democrats favor crime, remember?
No. of Recommendations: 5
Is a penalty no longer levied on filers via the tax code if a person can't prove healthcare insurance
Dropped back in - 2019? I was outa the states at the time. :) I've got FEPblue and I get the same employer contribution as if I was an active employee, so I tend not to pay attention as much.
Let's face it, Trump wants to kill ACA because... Obama. He also wants a Nobel Peace Prize because... Obama.
Trump's back to being a surrender monkey so we should expect defeatist talk by the MAGA on the board. But I think the Nobel Peace Prize befuddles them.
No. of Recommendations: 1
There is a huge business and food industry constituency that needs SNAP aside from the actual recipients of the SNAP benefits.
It's the same thing with the free cheese in the 1980's, subsidized lunches in schools, and so forth.Yes, there is a constituency for food. A constituency for insurance. A constituency for oil and gas. A constituency for house building. A constituency for tax cuts. Trying to provide government subsidy for every constituency is the sort of pandering that makes for $1T deficits.
The tariffs, which were supposed to offset some of the "JC" tax cuts, didn't poll well, so some are rolled back.
Tariffs will cut deficits by $1 trillion less than expected, CBO sayshttps://www.axios.com/2025/11/20/trump-tariffs-def...oops. Now what?
Steve
No. of Recommendations: 11
Democrats favor crime, remember?
Democrats favor protecting the innocent over punishing the guilty.
Republicans generally trend toward "let god sort them out".
This creates that popular misconception.
No. of Recommendations: 2
No, Democrats expressly favor crime.
Whether that be street crime, or immigration crime, or welfare fraud.
As long as they think the criminals will vote Democrat, it's all good.
No. of Recommendations: 2
"People will drop health care to afford basic necessities."
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Hobson’s Choice: A free choice in which only one option is offered; i.e., “take it or leave it”.
Morton’s Fork: Is a choice between two equally unpleasant alternatives (in other words, a dilemma) or two lines of reasoning that lead to the same unpleasant conclusion. It is analogous to the expression, “between the devil and the deep blue sea,” and “between a rock and a hard place”.
Buridan’s Ass is an illustration of a paradox in philosophy in the conception of free will. It refers to a hypothetical situation wherein an ass is placed precisely midway between a stack of hay and a pail of water. Since the paradox assumes the ass will always go to whichever is closer, it will die of both hunger and thirst since it cannot make any rational decision to choose one over the other. The paradox is named after the 14th century French philosopher Jean Buridan, whose philosophy of moral determinism it satirizes.
