Monday, February 28, 2011
I'm a little late to the Truck Tonnage party (see Mark Perry's latest post on the subject here, and Calculated Risk's post here), but I do have this interesting chart to add to the discussion. Truck tonnage (seasonally adjusted) has now almost completely recovered to its pre-recession highs, after a strong 3.8% gain in January. Say what you will about the Fed inflating asset prices, but when the millions of trucks out there are actually hauling increased amounts of stuff around the country, that's a pretty good indication that economic activity is definitely picking up.
As this chart shows, the stock market has done a pretty good job of tracking truck tonnage over the decades, though it tends to "overshoot" now and then as psychology at times blinds investors to the underlying fundamentals. My read of this plus many other indicators I've highlighted here is that there is a genuine upturn in the economy underway, and the stock market is in the early stages of catching on. With trucking activity poised to reach new all-time highs this year, there is no reason not to expect the equity market to also register new all-time highs.
Posted by Scott Grannis at 2:39 PM