CPI is flat. The only thing holding it up is energy and food. This is how the speculative bubble in June 2008 popped.
Consumer goods are already showing signs of collapse. t.co/qCgPqCXSvu pic.twitter.com/soQr7jzHxJ
— Financelot (@FinanceLancelot) June 10, 2022
Inflation re-accelerated, even as wage gains slow down. Real wages on a weekly basis plunge to the most negative in data going back to 2006. pic.twitter.com/gp53tWeZjk
— Lisa Abramowicz (@lisaabramowicz1) June 10, 2022
“The Demand For Random Crap Suddenly Vanished, Taking Everyone By Surprise”
At the beginning of 2022, things were economically pretty peachy. Too peachy, one could argue: People were buying so much stuff that our ports and terminals could barely handle the massive import volume. Companies were desperate for someone, anyone, to come work for them. And movie theaters, offices, planes and other locales many eschewed during the pandemic were poised to bounce back; the omicron wave appeared mild compared to previous bouts of the coronavirus.
The vibes were good. Now, the vibes are completely terrible.
Alert! US import demand is dropping off a cliff
The latest ocean container bookings data reveals that despite the strong levels of inbound cargo during the first five months of 2022, import demand is not just softening — it’s dropping off a cliff. Because capacity on the trans-Pacific has remained relatively stable, Freightos’ container spot rates from China to the West Coast have plunged 38% month-over-month to $9,630.
Freight forwarders will enjoy expanding margins on ocean freight, while U.S. trucking carriers and intermodal volume providers may start to see volume risks.
Consumer buying patterns are rapidly normalizing to pre-COVID levels, and U.S. retailers are stuck with too much inventory. Target (NYSE: TGT) shares dropped Tuesday morning after executives said the company would mark down unwanted items, cancel purchase orders and move quickly to get rid of excess inventory.
The backlog of ships off the coast of CA has largely disappeared. While the port gets some credit – the real reason is demand destruction. As retailers have experienced unprecedented inventory levels, they've slowed their orders and the "big crunch" is gone. h/t @JPHampstead pic.twitter.com/yv4gEX3YD5
— Craig Fuller 🛩🚛🇺🇦 (@FreightAlley) June 10, 2022
Perpetual boom and bust cycles.
The crash is just getting started….. pic.twitter.com/PR2O33MrFs
— HOZ (@MFHoz) June 10, 2022
Excluding food and energy, prices were up 0.6% in May, the same rate as April, and up 6% from a year earlier.
— Ben Casselman (@bencasselman) June 10, 2022
Before I bought a house 6 years ago I paid $450/month in rent. Even my current mortgage + interest + escrow (on a 20Y note) is less than that. This sucks. pic.twitter.com/VxoiPPyLEb
— Ramp Capital (@RampCapitalLLC) June 10, 2022
Washington's recent spin-cycle episode featured US Treasury Sec. Yellen. She urged Congress to increase govt. investment in affordable housing & renewable energy to relieve inflation. A US Sec. babbling nonsense shows you how much trouble the US is in. t.co/6u8A47RlXP
— Steve Hanke (@steve_hanke) June 10, 2022
“We have fastest growing economy in the world”…it shrank last quarter 1.7% 🤡pic.twitter.com/bYHHllh1Jj
— Ed ☯️Free Thinker & Oracle (@DowdEdward) June 10, 2022
Freddie Mac agrees with our long running argument. & NAHB says that Housing activity is 15-18% of GDP. But Fed doesn't see a recession….t.co/PLmXZH1f20
— PPG (@PPGMacro) June 10, 2022