Mish's Global Economic Trend Analysis

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• Aging Trucker Workforce Coupled With Increased Demand Provides Strong Incentive for Trucking Robots
• Baffled by Clear Picture; Sirens of Blackmail; Merkel's Alleged Revenge Will Backfire
• Tsipras Allegedly Caves In On Many Creditor Demands; No Vote Leads Polls but Yes Gaining

Aging Trucker Workforce Coupled With Increased Demand Provides Strong Incentive for Trucking Robots Posted: 01 Jul 2015 06:51 PM PDT Demand for truck drivers is on the rise. Yet, there are not enough young drivers who want that rough of a lifestyle. Supply Chain reports Aging Truck Driver Work Force - A Major Issue in Filling Demand & Empty Seats. With a combination of retirements and people exiting the industry, carriers need to recruit in roughly 100,000 drivers per year over the next decade to simply keep pace with projected United States freight needs. The American Transportation Research Institute (ATRI) released a fascinating white paper analyzing the age demographics of truck drivers. The bottom line is that the U.S. truck driver population is aging and there are not enough young drivers in the labor force to fill the empty seats that will be opened by the upcoming retirement of drivers. As I think about how to attack the driver shortage problem, I believe the answer is more than higher pay. Increasing Supply The primary shortage is for over-the-road TL drivers who spend weeks at a time away from home, sleeping in their trucks, showering and eating in truck stops, and enduring unnecessary hassles in getting unloaded in a timely fashion. Increasingly, we also hear about shortages in LTL and drayage capacity. Higher pay is the simplistic answer, but manufacturers and retailers can ill afford higher transportation rates so higher pay has to be associated with greater productivity. Getting 18-year olds into the industry is critical, but is limited by the CDL 21-year old age requirements. Immigration can be part of the solution to the driver shortage, just as it is for high tech workers. Higher Pay? In addition to higher pay, Supply Chain also discussed reducing the legal age of truck drivers, automatic transmissions, using retirees, spousal teams and other related nonsense. Good Grief! Supply Chain missed the ballpark by a mile with that lame set of non-solutions. It is amazing how far off the mark the article is. Reader Tim Wallace who sent me the article accurately summed up the situation in a single statement: "They missed the main result of the trend - automation." Self-driving trucks are on the way, as I have discussed at least a dozen times. There will not be a need for 100,000 drivers a year for decade because robot drivers will eliminate five million jobs in the same span, if not before. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Baffled by Clear Picture; Sirens of Blackmail; Merkel's Alleged Revenge Will Backfire Posted: 01 Jul 2015 01:42 PM PDT Sirens of Blackmail Having already explained twice what is going on with Tsipris' ever changing statements, I find it amusing that eurozone nannycrats cannot figure things out. A few snips from the Financial Times article Tsipras Urges Greeks to Defy Creditor' "Blackmail" will explain what I mean. Greece's prime minister accused Europe's leaders of attempting to "blackmail" Greek voters, just hours after apparently holding out an olive branch to the country's creditors by accepting most of the terms of the economic reform plan they had tabled last weekend. Eurozone officials said they were baffled by the mixed messages coming from Greece, which this week missed a €1.5bn payment to the International Monetary Fund and has been forced to impose capital controls to avert a financial meltdown. In a nationally-televised address, Alexis Tsipras, the Greek premier, urged his countrymen to vote No in a referendum on whether they should accept tough terms for bailout aid, and accused EU leaders of threatening to drive Greece out of the euro. "The sirens of destruction are blackmailing you to say yes to everything without any prospect of exiting the crisis," Mr Tsipras said. Baffled by Clear Picture One has to be really dense to not understand Tsipras is saying and doing exactly what needs to be said and done to help sway a "no" vote on the referendum. One might argue that eurozone officials do understand but purposely sound like they don't, however, that idea has two major strikes against it. When stupidity is a clear choice, it is likely the right one. Occam's Razor suggests the simplest answer that works is the most likely answer, and what can be simpler than stupidity? It could be in the best interest of the eurozone offcials to make a statement that Tsipras is electioneering. Of course, the eurozone officials are also electioneering, so perhaps they simply feel trapped and have no idea what to do or say about Tsipras' moves. Merkel's Revenge Here's an amusing story that is equally clueless in nature: Angela Merkel Takes Revenge on Greek Prime Minister. Alexis Tsipras stunned Greece's creditors on Saturday by walking out of rescue talks and calling a national referendum on their last bailout offer. Now German Chancellor Angela Merkel is taking her revenge. She does not speak it, at least not in public. But with quiet determination she is making the Greek premier squirm — by refusing his desperate efforts to return to the negotiating table. Reflecting the desperation felt by some of Greece's creditors, French President François Hollande called on Wednesday for an "immediate accord". But Ms Merkel has stood apart, insisting that there can be no more talks until after Sunday's referendum — a stance she calmly reiterated to the German parliament on Wednesday. "She is squeezing Tsipras hard because he has tried to squeeze her [by calling the referendum], even if with limited effect," said Josef Janning, a Berlin-based fellow at the European Council on Foreign Relations think-tank. Merkel's Alleged Revenge Will Backfire Reader "AC" hits the nail on the head again today with another well-reasoned thesis. "AC" explains why the alleged "squeeze" is counterproductive. Hello Mish Looking at the last developments, it seems to me that Germany is making errors in its negotiation strategy (if they have any). They basically closed the door to any discussion before the referendum. This is a driver to vote "no". The message is "we will sit again at the negotiation table after the referendum", but if "yes" wins there is no negotiation to do! The one that has the most to lose in deleting the the referendum is Tsipras. Tsipras on his side asked for what he needed the most and what he used the most so far: time. Time gives Greeks and their government ability to multiply the options and the negotiation power. Let's see what happens. AC Merkel Squeezed Three Ways It appears to me that Josef Janning's think tank is also baffled by a clear picture. The only one who is squeezed here is Merkel. The chancellor is squeezed between a referendum she does not want, a majority of Germans who are willing to say goodbye to Greece, and her own position of not wanting Greece to leave the eurozone on her watch. That's a tight squeeze conundrum with absolutely no answer. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Tsipras Allegedly Caves In On Many Creditor Demands; No Vote Leads Polls but Yes Gaining Posted: 01 Jul 2015 05:09 AM PDT Stock futures are up this morning on news that Alexis Tsipras Backs Down on Many Greece Bailout Demands. A reader asked me about Tsipras' cave in, but I responded it is nothing but a political ploy ahead of the July 5 referendum as to whether or not Greece should accept the creditor's take-it-or-leave-it offer. I am not the only one who sees it that way. In spite of numerous headlines that make it appear as if this was a significant breakthrough. Wolfgang Schäuble, Germany's hardline finance minister, gave the latest Greek initiative short shrift, saying it was "no basis" for serious talks. Eurozone officials involved in the talks cautioned Mr Tsipras's remaining demands in the letter were "not a handful of minor changes" and would have "significant fiscal impact" and may not be acceptable to creditors. Gaming the Vote There was no cave in, this is merely electioneering by Tsipras to counteract the nonstop meddling and electioneering by Germany, France, Spain, and European Commission president Jean-Claude Juncker. For details, please see Greece Rejects 25th Hour Request to Change Course; Tsipras Asks Eurozone for Third Bailout; Rajoy Seeks to Save His Own Ass. No Vote Lead Narrowing FXStreet reports Greek Referendum Poll Shows Lead for 'No' Vote Leading but 'Yes' Catching Up. Another Greek bailout referendum opinion poll is out, conducted by prorata polling institute for efimerida ton synatkton newspaper, with responses before bank closure showing yes 30 pct, no 57 pct, don't know 13 pct, while responses after bank closure have seen yes 37 pct, no 46 pct, don't know 17 pct. Rather than caving in, Tsipras' proposal was simply a means to influence votes. As I noted yesterday, "As pertains to game-playing, Greek leaders have run circles around the eurozone nannycrats." Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

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