The collapse of one of the world’s largest ocean carriers has marooned more than half a million cargo containers in international waters. As much as $14 billion worth of cargo is stuck in limbo awaiting the fate of bankrupt Hanjin Shipping, with dozens of vessels anchored offshore filled with toys, shoes, computers, couches, dishwashers, etc. Port operators and cargo handlers refuse to unload the ships until they are paid.
Hanjin’s global creditors have impounded at least eight vessels, and about 80 are still at sea until captains are assured ships and cargo won’t be seized. It isn’t clear whether Hanjin’s parent company will be able to secure the $90 million it pledged to ease the carrier’s financial woes, or whether that will be enough to dent Hanjin’s $5.5-billion debt. The company has resorted to selling off ships from its 149-vessel fleet, after signs that the South Korean government won’t bail out its largest ocean carrier.
Continue reading “Billions’ Worth of Merchandise Stranded at Sea”
Widening 4% in ’16, after a 6.2% increase in ’15
Weak global growth combined with a relatively strong U.S. dollar will drive the U.S. trade deficit up 4% this year, as American exporters struggle to stay competitive in key trading nations. The drag on exports is likely to continue into next year. Continue reading “Trade Deficit Increases in Listless World Economy”
4% growth in ’16, compared with 4.8% in ’15 (excluding gas)
Feeling more confident about the economy, the job market and their own financial stability, shoppers dialed up spending in June. The third consecutive month of gains marks a strong end to the second quarter of 2016, though challenges remain as retailers grapple with changing industry trends—more online shopping, free shipping demands, etc. Continue reading “Consumers Rev Up Spending”
Prices up 5% on average in major metro areas
Favorable mortgage rates and healthy job growth will spur home buying and residential construction in coming months.
Continue reading “Housing Market Keeps Its Momentum”
Flat in ’16, after drop in ’15
Turmoil in overseas markets is adding an extra layer of caution to U.S. businesses’ plans for investment in new equipment purchases.
Continue reading “Flat Growth for Business Spending in 2016”
1.8% for ’16, up from 2.4% in ’17
Consumer price inflation will continue to pick up through the rest of the year, though at a rate of 1.8%, a slower pace than we have been forecasting because energy and food price increases are moderating.
Continue reading “Inflation on the Rise”
10-year T-notes at 1.4% by end ’16
The vote by Britain to leave the European Union has completely changed the outlook for interest rates. Rates should stay low for an extended period of time as U.S. Treasury notes and bonds remain important safe haven investments in the face of uncertainty over growth in Europe and Japan.
Continue reading “Brexit Vote Puts Damper on Interest Rates”
Hiring slowing to 150K-200K/month by end ’16
Look for job growth to gradually retreat into the range of 150,000 to 200,000 jobs per month — versus a strong 255,000 jobs added in July — as the hot employment market of the past few years downshifts to a more sustainable pace.
Continue reading “Pace of Job Growth to Slow”
1.4% growth for the year; a 2% pace in ’17
The U.S. economy continues to plod along in lackluster fashion, as evidenced by the fact that the gross domestic product climbed at just a 1.2% annualized rate in the second quarter.
Continue reading “Uncertainty Clouding GDP Outlook”