In The U.S., A Transportation Recession Has Already Officially Arrived

A transportation recession often precedes a recession for the entire economy, and while the debate about when the U.S. economy as a whole will plunge into a recession is quite vigorous right now, the truth is that the debate is over regarding when a transportation recession will begin.  Throughout 2017 and most of 2018, U.S. freight shipment volume was booming, and that was a very strong sign that overall economic activity was rising.  But when economic activity begins to decline, freight shipment volume often goes negative, and that is precisely what is happening right now.  In fact, U.S. freight shipment volume has now declined on a year over year basis for eight months in a row

Freight shipments within the US by all modes of transportation – truck, rail, air, and barge – fell 5.9% in July 2019, compared to July 2018, the eighth month in a row of year-over-year declines, according to the Cass Freight Index for Shipments, which tracks shipments of consumer and industrial goods but not of bulk commodities such as grains. This decline along with the 6.0% drop in May were the steepest year-over-year declines in freight shipments since the Financial Crisis

When something happens for eight months in a row, that is definitely a trend, and we haven’t seen declines of this magnitude since the last recession.

And other numbers confirm what the Cass Freight Index is telling us.  For example, ACT Research says that the trucking industry is officially in a recession after “two consecutive quarters of negative growth”

The trucking industry is officially in a recession, according to data tracked by ACT Research.

After months of suggesting a pullback was possible, ACT President Kenny Vieth told FreightWaves on Thursday, July 11 that all metrics his firm tracks meet the technical definition of a recession – two consecutive quarters of negative growth.

Every freight metric we look at has been negative for at least six months,” he said.

Of course it is possible that the transportation industry could pull out of this recession without the U.S. economy as a whole dipping into one, but I wouldn’t count on it this time.

As I have been documenting for months, just about every economic indicator is telling us that big trouble is ahead.

And more bad news just keeps rolling in on a daily basis.  In fact, we just learned that yet another major retailer is shutting down all of their stores

Plus-size women’s clothing retailer Avenue Stores, LLC is shutting down all locations.

On Wednesday, the company announced plans to close all 222 stores across 33 states. Everything from clothing to store fixtures will be sold from locations across America, according to a press release.

Usually major retailers don’t do this sort of thing so late in the year.  If at all possible, there is usually an all-out effort to hang on through the highly lucrative Christmas season, and so things must have been really bad for Avenue Stores to pull the plug here in mid-August.

And all of this is happening even though interest rates are still much lower than the long-term average and the federal government is borrowing and spending money like there is no tomorrow.  According to Wolf Richter, our national debt is up by more than a trillion dollars over the last 12 months…

The US Gross National Debt has jumped by $363 billion in the two weeks since President Trump signed the law that suspended the debt ceiling. This surge pushed the total debt to $22.39 trillion. That’s up by $1.01 trillion from 12 months ago. And these are the good times.

This is emergency level spending, and it has been happening while the U.S. economy has still been relatively stable.

When the federal government borrows money that it does not have and spends it into the economy, that tends to boost overall economic activity and raise GDP numbers.  This was Barack Obama’s favorite economic trick, and Donald Trump has followed right in his footsteps.  But of course in the process we are literally destroying the bright future that our children and our grandchildren were supposed to have.  What we are doing to future generations of Americans is beyond criminal, and all of us should be deeply disgusted by what is happening.

But of course the politicians in D.C. are deathly afraid to do anything about our exploding debt, because if we cut spending to sustainable levels that would immediately plunge the U.S. economy into a horrific recession.  And when bad economic times come, voters tend to vote out the people that are already holding office.

For President Trump, keeping the U.S. economy out of a recession is absolutely critical to his chances of winning in 2020, and he knows it.

His opponents know it too, and that is why many of them are openly rooting for a recession.  For instance, just check out what Bill Maher said on his show on Friday

HBO’s Real Time host Bill Maher made another desperate plea for a recession on Friday, saying that the economic downturn “would be very worth getting rid of Donald Trump.”

“So I’ve been saying for about two years that I hope we have a recession,” Bill Maher said. “And people get mad at me, as Sean Hannity thinks I’m actually causing a recession. I’m just saying we can survive a recession. We’ve had 47 of them. We’ve had one every time there’s a Republican president.”

“So, yes, a recession would be very worth getting rid of Donald Trump and these kind of policies,” Maher said after citing a dubious United Nations report that claims a million species are at risk of extinction.

On the other side, President Trump and his team are going to try to make things seem as rosy as possible between now and election day.

So they will keep telling us that everything is just wonderful, and they will keep insisting that a recession is not coming

Top White House economic adviser Larry Kudlow said Sunday he does not forecast a recession “at all,” despite warning signs exhibited by the bond market last week.

“First of all, I don’t see a recession at all,” Kudlow told “Fox News Sunday.” “Second of all, the Trump pro-growth program, which I believe has been succeeding – lower tax rates, big rollback of regulations, energy opening, trade reform – we’re gonna stay with that. We believe that’s the heart of the free enterprise. We want an incentive-oriented supply-side economy, providing opportunities for everybody across the board.”

In the end, it really isn’t going to matter who is in the White House.  What is coming to America is going to be extremely painful, and we are about to reap the consequences for decades of incredibly foolish decisions.

How we view reality should never be distorted based on what political party we identify with.  When we willingly choose not to see things objectively, we become very susceptible to deception.

The truth is always going to be the truth, and in our case the truth is not pretty.

Michael Snyder

Author: Michael Snyder

Michael Snyder is a former Washington D.C. attorney who now publishes The Economic Collapse Blog and End of the American Dream. Michael and his wife Meranda believe that God is raising up a Remnant in these last days (Revelation 12:17; Revelation 14:12) that will bring in the greatest move of God the world has ever seen and the greatest harvest of souls the world has ever seen.

© 2019, Z3 News. The first 200 words of Z3 News articles may be shared online in exchange for a clickable link to our site. Please include the author name and do not make any changes to text or titles. No image files from our site may be shared because we don’t own them. For permission to use our content in other formats, please contact us.

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Danielle Patton
Danielle Patton
Member
August 19, 2019 3:51 PM

Preach it Michael

jerry rigg
Member
August 19, 2019 12:35 PM

Very enlightening article. Its as if the prophetic watchmen as well are blowing their trumpets warning of imminent trouble. It reminds me of the Titantic, if you are entering treacherous waters, you need a watchmen on the ship to spot icebergs ahead. If you are extremely foolish, first you will have no watchman, second, even if you have one and you dont take heed to their warning and plunge full speed ahead into the iceberg field this is a duo recipe for disaster. Has anyone seen the cartoon depicting the Titantic as the U.S. economy with the caption….no one can sink this ship ….its unsinkable…or worse yet, not even God can sink this ship? Could it be that is where we are right now? I think as well, a major west coast quake could especially plunge the market and economy down immediately if it were to happen now.

Mike
Mike
Member
August 23, 2019 9:42 AM

James, the market seems to be bullish after the fed meeting, although there was no outcome of it.Are you expecting the s&p to hit 2520 by end of this month?

James Bailey
Admin
August 23, 2019 12:31 PM

A lot of cycles are showing a steep drop next week. The 1929 analog is forecasting a drop to 2516, which is very close to the number I saw on July 10, 2520. I think we’re on track so far.

Mike
Mike
Member
August 23, 2019 4:26 PM

Thank you James,God had led me to you. May god bless you for helping everyone through this website.

James Bailey
Admin
August 23, 2019 9:10 PM

SPX might get a big spike up Monday to shake out the bears before dropping fast to about 2520.

Brian C.
Brian C.
Member
August 24, 2019 8:10 AM

James, have you received revelation of a move back up to 2930-40? If so, do you mind sharing?

James Bailey
Admin
August 24, 2019 2:32 PM
I was not shown any prices, but on August 3, I was shown a vision of a body of water surrounded on all sides with a rocky bottom that started on the left side with a steep drop then continued moving lower slowly until it reached the lowest point and then moved straight up on the right side, noticeably higher than where it started dropping on the left side. I thought it was forming on August 14-16, but the move up was interrupted with a few hours of horizontal movement before continuing up steep on August 19. It’s possible that was it, but I did not see that horizontal movement on the way up, which makes me think it’s still ahead. On the 3-minute chart, Friday’s drop looks exactly like what I saw, just missing the steep move up. Since the drop started around 2924, the move up would need to go higher, which is why I mentioned possibly getting up to the previous resistance level around 2940, but it could also go a little higher. In that vision, I did not see what happened next, but separately, I saw a chart showing a steep move up that immediately dropped steep back down at least as far as where it started from, so it was a huge spike up and down, very fast. Separately, I had a dream in which I was warned about a big move up coming right after a drop, which would also be fulfilled if we get a big move up on Monday. I saw no dates or prices in any of these, so just watching for them and guessing it might be Monday. With so many people short right now, it would be the perfect time to scare the bears before the real drop begins.… Read more »
william
william
Member
August 26, 2019 3:28 AM

James,
I give glory to the Lord who gave you the revelation. And I thank you for sharing these revelations. I read your post yesterday. And I buy some future call options to hedge the shorting positions when it was opened . Now theses call options are in money. S&P future is now 2871. Hoping the drop to 2520 will happen after S&P rises up to 2924-2950. If you change your view on the market movement, please give us a warning.

James Bailey
Admin
August 26, 2019 11:09 AM

The volatility has increased and I expect that to continue. One minute it looks like it’s crashing and soon afterwards looks like a big rally, so I think it requires having strong conviction about whatever position we take. I still believe the price will drop to about 2520 soon, but I was not shown any dates, so my assumptions about timing could be wrong.

Phil - Sydney
Member
August 24, 2019 5:21 PM

Dear James – many thanks. The WARNING is valuable. My IG markets balance has been chopping +/- $4000 over the last few weeks. I hold DEC PUTS on the DOW Index and this has saved me from losing the lot. IG Markets weekend futures now have . weekend wall street cash at -306 (-1.19%) but that can change rapidly up to 9am Monday open Sydney time. For RDD crypyto holders as I am (including on Cryptopia – ARRGHHHH!) here is a very interesting past post on Z3 news from 13 June 2018. Let’s seek God and remain patient. I believe God provides timing information well in advance and yet we expect an immediate outcome. It does not always work that way. https://z3news.com/w/prophetic-dream-shows-precious-metals-prices-spiking-spike-reddcoin/ God bless all readers . Let’s remember to reinvest $$$ in Kingdom business. That’s what is really important. PS. We buried are dear, passionately evangelistic assistant pastor Ann Yeo at Macquarie Park in Sydney on Saturday afternoon. Funerals help focus my goals back onto Christ and what is really important. God bless us all and help up to remain focused on our calling as LIGHT is an increasing dark world., Phil

Brian C
Member
August 26, 2019 11:36 AM

Thanks JB. I appreciate the background.

william
william
Member
August 26, 2019 10:10 AM

James,
S&P does not look like spiking up. I close all the put and call position.

James Bailey
Admin
August 26, 2019 11:03 AM

It’s currently up 22 with 4 hours to go.

Mike
Mike
Member
August 26, 2019 2:45 PM

James, do you think it might go up to 2940 tomorrow or is this not what you are looking for?

James Bailey
Admin
August 26, 2019 8:17 PM

The technical guys are forecasting a small drop early tomorrow that reverses and starts a move back up to the top. That sounds believable to me because I saw a vision Saturday morning showing a chart of the upcoming drop and the crash afterwards. It was a tall skinny V-shape with two green candles at both tops, both at about the same level. I was not shown any dates, but I am assuming the chart was a daily chart. If so, the candles need to close the day at the top to give them the green bodies that I saw. However, there are two possibilities. First, the skinny V-shape shows the whole drop to 2520. Second, it shows only the biggest part of the drop after the first drop to about 2700 and roughly 50% retrace to 2820. I can only speculate about which one it is because I was not shown any prices.

Regarding 2940, that target assumed SPX was forming the rocky bottom of a body of water I saw on August 3. Today’s price movements ruled that out. It was likely fulfilled on August 12-16. My current price target for the next top is around 2915. If we get a big green candle up to that level or higher, I would expect the drop to begin right away. So it could get started later this week or possibly next week.

william
william
Member
August 29, 2019 9:28 AM

James,
Just for checking. The high of S&P has reached 2924. Have you moved into the shorting position yet or are you planning to?

James Bailey
Admin
August 29, 2019 11:12 AM

I think my dream about a drop from the 2910-2915 level with a return back up was already fulfilled by previous drops in August, so I no longer have a specific price target for how high SPX will go up. The technical pattern for the VIX shows it could continue dropping tomorrow and possibly into Tuesday Sep 3, which means SPX bullishness could continue until then. Beyond that, my technical guys have conflicting forecasts with one showing a drop until about Sep 6 and another showing bullishness until Sep 9.

New moons and full moons have a history of marking turns in the markets within one trading day and tomorrow is a new moon. Then there’s a full moon on Sep 13. The first leg down needs to start next week to keep on track for a bottom on Oct 11. Otherwise, the bottom would get pushed back to Oct 25. Locating the first drop to about 2700 is I think the hardest part of trading what’s ahead, so it requires lots of patience and caution.

Cunny Fred
Cunny Fred
Member
August 30, 2019 8:26 AM

Lets see what happens over the Public Holiday weekend.

william
william
Member
August 29, 2019 2:22 PM

James,
” I saw a vision Saturday morning showing a chart of the upcoming drop and the crash afterwards. It was a tall skinny V-shape with two green candles at both tops, both at about the same level. ” . I think the vision you saw would be quite crucial.

Mike
Mike
Member
August 29, 2019 1:30 PM

Thanks James, how high do you think SPX might go in the bullish case scenario?

James Bailey
Admin
August 30, 2019 11:37 AM

Great question. I have not been shown any higher price targets, but earlier this year, Phanuel shared that he saw 3035. It topped on July 26 at 3028, so it’s possible it could return back to that range before crashing. A couple of technical analysts I follow are forecasting bullishness ahead. One of them has a top around Sep 9 and the other until mid-September. If they’re right about that, then the crash likely doesn’t hit bottom until Oct 25, but even so it would begin dropping sharply in late September. The timing will get clearer after we get the first drop to around 2700. In the meantime, I’m inclined to play it safe and be patient.

Mike
Mike
Member
August 30, 2019 6:13 PM

I’ll just hold on to my shorts, and buy October puts instead of September. Thank you.

william
william
Member
August 29, 2019 12:31 PM

James,
I guess that S&P may have the possibility to keep rising to 3035 until before September 25 , then crash on September 25 to match some feast of God before the end of September.

Cunny Fred
Cunny Fred
Member
August 29, 2019 12:22 PM

James, in August 2019, the SPX is forming a ZIG-ZAG pattern, similar to the pattern formed between October – September 2018.

SPX keeps on bouncing off support at approximately 2840. However, the ZIG-ZAG pattern shows that the 2840 support will be broken on a final attempt.

Mike
Mike
Member
August 27, 2019 11:54 AM

James, looks like the market peaked out at around 2900 and has been dropping. Thank you for sharing your analysis

James Bailey
Admin
August 27, 2019 2:12 PM

It might drop some tomorrow, but my current forecast is a top around 2915 sometime between Aug 30 and Sept 5, followed by a drop to around 2700, which would be the first leg down on the way to 2520. If it drops to around 2800 tomorrow, I might buy some calls expiring Sept 6.

Phil - Sydney
Phil - Sydney
Member
August 27, 2019 6:00 PM

Very helpful James,
God bless you brother in Christ.

Mike
Mike
Member
August 27, 2019 5:39 PM

James, I will hold on to my shorts until 2700, the volatility seems to be too high. Silver is at 18.25 today, do you still think it’ll go back to 13.35 or were there any further revelations by lord? Thank you for guiding us through the coming tough times.

Cunny Fred
Cunny Fred
Member
August 27, 2019 12:36 PM

SPX seems to have made a “triple bottom” at approx 2840 (bouncing off 2840 support 3 times) in August 2019.

This is similar to the “ZIG-ZAG” market behavior in October – December 2018.

When a market hits support many times, it is likely to break support at a final attempt.

I made some comments on “CYCLES OF THREE” in comments below (if you scroll the page down).

JBernard
JBernard
Member
August 23, 2019 9:45 PM

How high do you think it might spike?

James Bailey
Admin
August 24, 2019 5:43 AM

Possibly as high as the previous resistance level around 2940, but then right back down again.

Cunny Fred
Cunny Fred
Member
August 23, 2019 11:01 PM

James, if you look at SPX graph, August 2019 looks like the zig-zag formation that occurred between 03 October and 06 December 2018.
In December 2018, after the third dip to the support level at 2620, the SPX did not spike, but continued to drag along the 2620 support level till 12 December, before the December plunge.

If the same is happening right now, the SPX might drag on along the 2840 support level, for a few days, before the correction.
A 17% correction from 2840 = 2350 = December low.

GUESSWORK
James, I know that you saw 2520, but this might not be the absolute bottom of the expected correction. SPX might have a sudden wick down to 2350, in a situation that cannot be traded by normal investors.
SPX might bottom out at 2350, before bouncing back up to 2520.

We need to be careful, to avoid disappointment.

Cunny Fred
Cunny Fred
Member
August 23, 2019 3:35 PM

I meant 828 923. Sorry for the error.

Cunny Fred
Cunny Fred
Member
August 23, 2019 3:34 PM

James Bailey, i remember that Phanuel saw 828 932 last year.

When I look at the SPX chart from October 2018 till date, I see s few CYCLES OF THREE.

My definition of CYCLE OF THREE is when a stock bounces of support twice, but breaks support on the third attempt.

We have smaller cycles within larger cycles.

When I look at a recent cycle, we see that SPX has hit 2840 for the THIRD TIME in August 2019. I expect SPX to have a major correction from here.

On a larger scale, SPX has hit 2740 twice, since December 2018. I expect SPX to break this support on the third attempt.

It seems that the THIRD ATTEMPT to break 2840 in the August cycle will actually correspond with the THIRD ATTEMPT to break 2740 since March 2019.

– James, I remember that you saw 17% and 2520
– I know that 17% drop from 3028 = 2520,
– Also, 17% drop from current support at 2840 = 2350 = December low

HERE IS MY GUESSWORK
If SPX dips to 2350 in the next correction, this would be the second bounce, so that SPX can PLUNGE below this support on the third attempt, after the expected “SKINNY TREE” rally.

I know that you saw 2520, Phanuel saw 2560, but if the “cycle of three” is correct, then it is POSSIBLE for SPX to drop to 2350 in the next correction.

Anne Chivers
Anne Chivers
Member
August 19, 2019 5:52 PM

I think the same re recession for many countries. Aust. talking about it recession that is )also noticed this news report re Germany:

https://www.9news.com.au/world/germany-recession-wide-implications-as-european-powerhouse-hits-hard-times-finance-news/9bafd7ab-528e-4772-a77d-746bc3ece4de

Thanks Michael for your detailed report & post.

Interestingly a week ago there is a lot of flack towards Australia ( re the coal industry).from the pacific region countries such as Samoa- re effects of climate change sea levels rising etc. Even N.Z -prime minister J.A. made comments that Aust. should be more pro- active re its responsibilities. Aust does give foreign aide to those countries & has increased its giving but not good enough according to the pacific region. A report said even New Guinea has asked China to help and that they have been forthcoming with ? monetary aide. infrastructure I guess. so there are problems on many fronts, climate, economies, gov’t, trade wars.

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