Some data is making a stron- _{ger case for a turn.} Cass Freight Index for freight shipments in mid-December, and has been _Y-O-Y improving modestly since then, ^–15% M-O-M B ^{ack in early December, after} November’s dramatic fall

Monthly year-over-year percent change in

5%

The JOC-ECRI Industrial

Price Index is sensitive to facto-

0%

ries needing to boost their supply

–5%

of inputs. The gauge hit its lowest annual growth rate of -69 percent

–10%

heading into February at -60. in rail traffic but before the

–20%

ECRI’s Banerji said that worst was to come, Finkbiner index plus others that ECRI predicted in February activity

–25%

1/08 2/08 3/08 4/08 5/08 6/08 7/08 8/08 9/08 10/08 11/08 12/08 1/09

builds to predict turns in could be picking up again.

Source: Cass Information Systems

economic activity, months He figured that after people in advance, shifted to milder Railcar traffic in chemicals at major U.S. carriers accepted their losses of the old declines in January than in tax year they would become

–10%

December. more optimistic, that the sever-

Several freight analysts and ity of the downturn in spend-

–15%

economist note a bounce in the ing was simply unsustainable,

Baltic Dry Index from its yearend –20% and that the incoming Obama record lows, as ocean rates perk administration would quickly up a bit for ships handling bulk ^–25% be injecting a big stimulus commodities now that China is package of new spending to

–30%

buying supplies for its domestic spur the economy. stimulus spending program. Now, “the primary event

–35%

Others caution against read- Dec. 6 Dec. 13 Dec. 20 Dec. 27 Jan. 3 Jan. 10 Jan. 17 Jan. 24 Jan. 31 missing from our equation is
ing too much into the BDI, or the Obama stimulus package,”

Source: Association of American Railroads

the related blip in input prices. he said. “Once we get the plan,

The latest wave of large-scale U.S. rail hauls of motor vehicles, equipment people will begin to feel better.” layoffs and production cuts also Rail executives, too, have

–10%

could trigger a new decline in been looking for that stimulus shipments by big manufacturers ^–20% bill to start spending out. Some and retailers. hoped the bill coming out of

–30%

Those include heavy-equip- Congress would send rail con-

–40%

ment builder Caterpillar, which struction money their way, but said it will cut out 20,000 jobs, the best they appeared to get

–50%

a 34,000 job loss with the liqui- –60% was the chance to ask states to dation of electronics store Cir- send some stimulus money to

–70%

cuit City, and job cuts already rail projects.

–80%

made or yet to come from Dec. 6 Dec. 13 Dec. 20 Dec. 27 Jan. 3 Jan. 10 Jan. 17 Jan. 24 Jan. 31 But they do think it will railroads, steel mills, chemical Source: Association of American Railroads boost traffic, by getting more firms and others. factories back on line and in

However, U.S. purchasing managers in both the factory and direct loadings of construction materials for infrastructure service sectors are telling Institute for Supply Management the needs ranging from road projects to municipal water pipes to contraction hitting their industries is losing its punch. school repairs.

The ISM manufacturing index for January fell to 32. 9 in So, a growing array of scattered evidence suggests the worst

December before notching up to 35. 6 in January, a cautious move of the downturn came in November and December, and that higher that suggests the U.S. factory sector is a long way from a bottom to this recession could be taking shape. Yet the econ-actually growing again. It is still far below 50, the group’s border- omy remains very fragile and even the faint signs of recovery line between growth and recession, but the January index was the could be derailed anew by shocks or the lack of pump-priming best since October when conditions were rapidly getting worse. federal help. ■

month as happened in the final months of last year.

And ISM said its non-man-ufacturing index edged higher for the second straight month to a 42.9 reading in January.

ISM said the transportation and warehousing industry was one of just two service industries out of 18 that added jobs last month.