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America Needs More Truckers

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The critical link in America's supply-chain struggles is a lack of truckers to move freight. Jennifer Smith reports at The Wall Street Journal: A critical, often-overlooked link in the supply chain is emerging as a stubborn choke point in the freight-backlog mess: trucking. Trucks haul more than 70% of domestic cargo shipments. Yet many fleets say they can’t hire enough drivers to meet booming consumer demand as the U.S. economy emerges from the pandemic. The freight backup has intensified longstanding strains in the industry over hours, pay, working conditions and retention. The … [Read more...]

BACKFIRE: China’s Australian Coal Ban Causes Shortage

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After banning coal imports from Australia in a diplomatic row, China has shot itself in the foot, sending it scrambling to source coal from other parts of the world to feed its own demand. Nathaniel Taplin reports for The Wall Street Journal: China’s latest efforts to improve conditions in its dangerous, fragmented coal mining industry have contributed to weak supply growth and skyrocketing coal prices. This has also spilled over into the liquefied natural gas market. The situation is reminiscent of late 2016, when a recovering Chinese economy collided with government mine closures, resulting … [Read more...]

HOUSE PRICE SOAR: “This Has to Stabilize at Some Point”

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The Case-Shiller home price index shows prices for housing have risen 19.7% since last year. According to Oxford Economics economist Nancy Vanden Houten, “This has to stabilize at some point.” But when will that be? The Wall Street Journal reports: Home-price growth climbed to a new record in July as buyers continued to compete fiercely amid a shortage of homes for sale, but there are signs the market frenzy might be starting to ease. The S&P CoreLogic Case-Shiller National Home Price Index, which measures average home prices in major metropolitan areas across the nation, rose 19.7% in … [Read more...]

Is the Fed Losing the Inflation Battle?

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The Federal Reserve is sending signals it believes inflation will last longer than expected. Greg Ip reports for The Wall Street Journal: All year the Federal Reserve’s message on inflation has been consistent: This year’s surge is transitory, and inflation will soon return close to the central bank’s 2% target. Yet look more closely, and it is clear officials are turning less sanguine—and that explains growing eagerness to start raising interest rates. Last September, long before the supply bottlenecks emerged, the median forecast by Fed officials was for core inflation (which excludes … [Read more...]

Biden Doesn’t Understand Why Gasoline Prices Are So High

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The Biden administration is worried about gasoline prices, and they don't understand why they're so high, or what to do about it. Perhaps setting the expectation that the administration would slowly be cracking down on all fossil fuels, thereby limiting investment in the fossil energy industry and future supply might have something to do with it. The Financial Times reports on Biden's confusion, writing: White House rankled by high gasoline prices It could be a headline from practically any presidency in recent decades. And the administration of Joe Biden — despite its green credentials … [Read more...]

WORKER SHORTAGE: Kellogg Changes Supply Chain to Fight Labor Shortages

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Shortages of truckers and factory workers have slowed Kellogg's ability to feed the voracious demand for its products produced as a response to COVID-19 lockdowns and dislocations. In Supply Chain Dive, Christopher Casey reports: In Kellogg's second quarter 2021 earnings call in early August, CFO Amit Banati said that the shortage of truck drivers is "widespread" and was draining money from the company at "much higher rates than what we had expected." With the overall shortage of labor, it's clear that Kellogg is trying to be strategic in how it focuses its existing workforce. While the … [Read more...]

OPEC Ready to Feed Growing Oil Demand After Biden Slowed US Production

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OPEC expects oil demand to grow beyond pre-pandemic levels by 2022. And while Joe Biden has acted to restrict the number of drilling permits on public lands, reducing oil production, OPEC is more than happy to fill increased demand. The Wall Street Journal's David Hodari writes: The world’s thirst for oil will exceed pre-pandemic levels next year, with improving vaccination rates and increasing public confidence in governments’ management of Covid-19 spurring a recovery in travel, the Organization of the Petroleum Exporting Countries said Monday. In its closely watched monthly market … [Read more...]

South Korea Slaps Google and Apple for Payment Monopolies

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South Korea has become the first country in the world to limit Big Tech companies' payment systems. CNBC's Saheli Roy Choudhury reports: South Korea’s parliament has approved a bill that will make it the first country to impose curbs on Google and Apple’s payment policies that force developers to only use the tech giants’ proprietary billing systems. The legislation will become law once signed by President Moon Jae-in, whose party has been a vocal supporter of the bill. Apple and Google’s policies usually require developers to pay the tech giants a commission as high as 30% of every … [Read more...]

CASH HOARD: How Will Companies Deploy Their Cash?

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Many investors are betting that companies with large hoards of cash on hand will use that money to buy back stock and to fund capital expenditures. Hardika Singh reports for The Wall Street Journal: Investors are betting that cash-rich companies will increase spending on everything from factories to share buybacks, a combination many believe can boost stocks in coming months. Businesses including Tyson Foods Inc., consumer-products firm Newell Brands Inc., Morgan Stanley and alcohol seller Constellation Brands Inc. have said in recent weeks they plan to build factories, expand research … [Read more...]