Category Archives: Economy

Student Debt Bubble Expands As Parents Do More Of The Borrowing

Not so long ago, student debt was mostly the responsibility of students. That is, you paid for college with loans and then paid off those loans with the proceeds of the good job you got with an advanced education.

These days it’s a little different. The cost of higher education is soaring, the jobs available to college grads don’t pay as much, relatively speaking, as they used to, and the size of loans available to students – though huge – don’t cover the full cost of many degrees.

One might expect these changes to lead more students to work for a few years and save up, or choose a cheaper degree, or eschew college altogether (as a lot of successful people now recommend) and substitute work experience for a diploma.

Some of that is happening but apparently the biggest change is that parents have stepped in to cover the difference between what their kids can borrow and the cost of a degree. As the chart below illustrates, until just a few years ago, the average debt of students exceeded that of students’ parents. But post-Great Recession, parents have given up trying to moderate the cost of their kids’ education and started doing the borrowing themselves. They’re now taking on the majority of new debts, and the gap is widening dramatically.

https://www.zerohedge.com/sites/default/files/inline-images/Student-loans-July-18.jpg?itok=KUg1xS-4

Retirement Crisis?

So we can add student loans to the list of instances where people who once tried to control their borrowing have stopped trying and are now just going with the flow. Which means several things.

First, kids who if left to themselves and the market would probably opt for one of the aforementioned cheaper alternatives are still in high-cost, frequently low-reward degree programs, and are being sheltered from the consequences by well-meaning parents.

Second, the retirement crisis that everyone is talking about – in which people who have never saved a penny are approaching retirement age and looking at 30 years of abject poverty – is being made that much worse by parents taking on new debts at a time of life when they should be aggressively trending towards debt-free/cash-rich.

Third and most important for people who aren’t participating in this game of financial musical chairs, the eventual implosion of the student loan market – i.e., the point at which loan defaults become intolerable – will lead to a government bailout, making student loans everyone else’s problem.

But of course the government won’t raise taxes or otherwise inflict immediate consequences on the electorate. It will borrow the money and create enough new currency to cover the first few years’ interest, leaving the longer-term consequences for later years and other people.

As with all the other mini-bubbles out there, if student loans were an isolated problem in a sea of rock-solid financial behavior they’d be easily managed. But they’re just one of many time bombs set to explode shortly.

https://www.zerohedge.com/sites/default/files/inline-images/Auto-loans-July-18.jpg?itok=6BbOoMkr

Auto loans, credit cards, underfunded pensions and increasingly mortgages and home equity lines are all heading the same way domestically, while emerging market dollar debt (which dwarfs the US mini-bubbles) is just as precarious internationally.

https://www.zerohedge.com/sites/default/files/inline-images/Emerging-market-debt-April-18.jpg?itok=bsE1w3xB

The question then becomes, how many of these bursting bubbles can the US paper over before the currency markets figure out that each will be followed by another, for as far as the eye can see?

Source: ZeroHedge

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Trump Says No Economic Brexit Means No U.S. Trade Deal

https://theconservativetreehouse.files.wordpress.com/2018/07/sun-cover-1.jpg?w=622&h=792

President Trump gave Rupert Murdoch (British U.K. Sun) an interview prior to leaving Washington DC for Brussels and the NATO summit.   Mr. Multinational Murdoch is severely against President Trump’s trade positions and wants to retain control over the global trade structure.   Murdoch personally has billions of dollars dependent on retaining the current globalist multinational trade scheme.

That’s the backdrop to understand the timing and presentation of the interview content.

As to the substance of the interview, President Trump is 100% accurate.  If the U.K. keeps the pre-existing trade pact with the EU, and essentially stays economically attached to the EU through acquiescence to the EU trade bloc, then any bilateral trade deal between the U.S. and the U.K. is essentially impossible.   Duh.

The EU doesn’t allow member nations to conduct their own trade negotiations.  So, any agreement that keeps the U.K attached to the EU economically means any trade deal with the U.K. would be a trade deal with the EU; and the EU trade positions are adverse to the ongoing economic interests of the United States.

This factual reality is the basis for President Trump telling The Sun any trade deal with the U.K. will be impossible under the current ‘Brexit’ terms that Prime Minister Theresa May has consigned herself to accept.   According to the interview President Trump warned Prime Minister May of this likelihood. Mrs. May then screwed herself and her nation’s economic interests by following the path of appeasement with the European Union.  It is not Trump’s fault for calling out the reality of the British economic position.

If President Trump speaking honestly about the economic consequence from PM May’s decision causes consternation, well, so be it.  When the Brits get done gnashing their teeth, the math remains unchanged.  Attach yourself to the EU and no bilateral trade deal with the United States is possible.  No amount of foot-stomping is going to change that.

The Brits can kick out Theresa May and do what they should have done two years ago; withdrawn from the European Union – a ‘hard Brexit’.  Or, if they like the way things are going…. just keep on keeping on.  It’s their decision.

https://theconservativetreehouse.files.wordpress.com/2018/07/trump-uk-10.jpg?w=623&h=410

May looks as if she knows she is screwed;
Mr. May looks like he knows his wife is screwed and he hates everything;
The President looks like Thor;
and Melania looks like a misplaced Goddess, above the fray.
Just a Great photo!

https://s33.postimg.cc/nd18nyzsf/trump-farage.jpg

Source: by Sundance | The Conservative Tree House

June Jobs Report: 213,000 Jobs Added, Economy Expanding, Blue Collar Gains Most Substantive…

The Bureau of Labor Statistics presents the latest snapshot of jobs and employment.  According to the BLS data, behind the 213,000 jobs added, the most significant gains all center around growth in durable goods, manufacturing, transportation/distribution and the ancillary business services directly connected to the blue collar sector.

In addition, April was revised up from +159,000 to +175,000, and the change for May was revised up from +223,000 to +244,000. With these revisions, employment gains in April and May combined were 37,000 more than previously reported.

https://theconservativetreehouse.files.wordpress.com/2017/12/trump-hat-business-workers.jpg?w=621&h=311

In the macro-review things are looking great; however, when you go into the micro-review you discover things are even better, they are MAGAnificent.

To understand what is happening we must all remember the Trump MAGAnomic policies are geared toward enhancing the creation of “goods”; the production of physical “stuff”; the manufacturing and durable good sector; or put another way: Main Street/Blue Collar work.   MAGAnomic policy is geared toward expanding the production base of the U.S. economy.  Therefore all majority benefit will be necessarily attached to those workers and industries that are part of the expanding production base.

https://theconservativetreehouse.files.wordpress.com/2017/12/trump-hard-hat-3.jpg?w=326&h=184

Blue-collar trade jobs are exploding bigly; and with that MAGA development the work hours and earnings of those who participate within the trade-production processes are showing significant gains.  Work hours continue expanding and the wage rates within the MAGA-trades are also showing the most substantive gains. (Table B-2, and Table B-3)

However, with 30 years of economic policy which diminished the blue-collar-trade value, the largest portion of the U.S. workforce shifted away from trades, and/or the production of durable goods.  As a consequence the non-trade driven (investment economy or service economy) is full of workers educated in pre-elizabethan poetry, arts and useless humanities (See Table B-1 and compare year-to-year).   The non-trade-skilled-workers are plentiful as bank tellers, retail workers, data entry, etc. and their abundance is keeping the macro-view of wage growth artificially skewed.

Wages, hours worked and benefits for those participating in the production economy (the minority number; ie blue collar) are gaining at a much higher rate than wages and hours worked by employees outside of the production economy (the majority number). In the aggregate this gives the artificial view that wages and hours worked are not expanding at the same rate as the overall economy.  This is a mistaken perspective confounding the majority of the economic punditry.   Remember, we are in the space between two economic engines: A Wall Street engine, and A Main Street engine.

The economic fuel, the MAGA policy feeding the expanding economy, is being poured into the Main Street engine; the production economy.  The majority benefit from the Trump policy shift is being felt by anyone and everyone attached to the production economy.

Those workers who are attached to the Wall Street economic are not gaining the same level of benefit; nor will they for the next two to four years.  The workers inside the production economy will continue to experience the majority of the economic and financial benefit for the foreseeable future….. we’ve got decades of diminished economic activity to make up for.

https://theconservativetreehouse.files.wordpress.com/2015/10/trump-hard-hat.jpg?w=310&h=143

Keep in mind, at a 30,000 ft overview, all of the current MAGA investment is pouring into plants and infrastructure.  When all of those production facilities start coming on line, approximately another year or two, they start generating even more jobs toward the finished goods each plant and facility will then provide.   More workers are then pulled away from the Wall Street economy and into the Main Street economy.  See how that works?

[In that ‘on-line production phase’, the *overall* wages then begin to rise; because the production worker base is expanded.]

Right now all of the trade jobs, and transportation (truck drivers etc) attached to the trade jobs, are at capacity.  Every raw material producer, miner, logger, and/or fabrication job professional: pipe-fitter, brick-layer, mason, welder, engineer, journeyman or apprentice therein; can make buckets of money with virtually unlimited work hours and overtime for those who can work with their hands and tools.

This is the MAGA economy; knowing how to use a pair of metal snips is WAY more valuable than a degree in gender studies.  Teach a Starbucks barista how to drive a fork-lift or operate a machinist lathe and they can increase their wages exponentially.

(Via CNN) Businesses added 213,000 jobs to their payrolls in June, another strong month of gains. Employers kept hiring even as fears grew of a global trade war. The economy has added jobs every month for almost eight years, the longest streak on record.

The unemployment rate inched up to 4%, the first increase in almost a year. But even that reflected a healthy economy: It rose because more than 600,000 Americans joined the work force. The job market is so good, many people who had previously given up looking are starting again.

“It’s a good thing. There are more people coming into the labor force,” said Satyam Panday, senior economist at S&P Global Ratings. “It indicates that we have more labor market slack.”

New entrants, including blue-collar workers and teenagers, shouldn’t have much trouble finding a job. There are more openings right now than unemployed workers, leading businesses to expand hiring to historically disadvantaged groups.  (read more)

https://theconservativetreehouse.files.wordpress.com/2016/09/trump-hat-1.jpg?w=620&h=349

Bureau of Labor Statistics DATA here.

Total nonfarm payroll employment increased by 213,000 in June and has grown by 2.4 million over the last 12 months. Over the month, job gains occurred in professional and business services, manufacturing, and health care, while employment in retail trade declined. (See table B-1.)

Employment in professional and business services increased by 50,000 in June and has risen by 521,000 over the year.

Manufacturing added 36,000 jobs in June. Durable goods manufacturing accounted for nearly all of the increase, including job gains in fabricated metal products (+7,000), computer and electronic products (+5,000), and primary metals (+3,000). Motor vehicles and parts also added jobs over the month (+12,000), after declining by 8,000 in May. Over the past year, manufacturing has added 285,000 jobs.

Employment in health care rose by 25,000 in June and has increased by 309,000 over the year. Hospitals added 11,000 jobs over the month, and employment in ambulatory health care services continued to trend up (+14,000).

Construction employment continued to trend up in June (+13,000) and has increased by 282,000 over the year.

Mining employment continued on an upward trend in June (+5,000). The industry has added 95,000 jobs since a recent low point in October 2016, almost entirely in support activities for mining.

In June, retail trade lost 22,000 jobs, largely offsetting a gain in May (+25,000).

Employment showed little or no change over the month in other major industries, including wholesale trade, transportation and warehousing, information, financial activities, leisure and hospitality, and government.

The average workweek for all employees on private nonfarm payrolls was unchanged at 34.5 hours in June. In manufacturing, the workweek edged up by 0.1 hour to 40.9 hours, and overtime edged up by 0.1 hour to 3.5 hours. (link)

Now, lets wait to see what Canada’s results show.   D’0h.

https://theconservativetreehouse.files.wordpress.com/2016/10/trump-hat-2.jpg?w=623&h=351

Source: By Sundance | The Conservative Tree House

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Where The Jobs Were In June: Who’s Hiring And Who Isn’t

After years of monthly payroll reports padded with excessive minimum wage waiter, bartender, educator or retail worker jobs, the June jobs report was notable for its top-line beat, and which was the record 93rd straight month of US job growth, offset by strong, if disappointing, wage growth, which at 2.7% came in below than 2.8% expected, perhaps due to the preponderance of part-time jobs, but nonetheless showed continued “late cycle” strength in most components even if some negative surprises were also present.

Of note: while last month’s jobs report was truly impressive in terms of job gains by industry, with the highest paying adding the most workers, in June we saw a continuation of many of the trends observed last month:

  • Continued strength in Goods Production: Mining (+4K), Construction (+13K) and especially manufacturing (+36K).
  • Trade & Transportation Continued to Rebound: Wholesale (+2.9) and Truck Transportation (+2.5K).

Here the surprise was perhaps that just 2.5K trucking jobs were added, following complaints from the major trucking employers, all of whom have noted they can’t find enough people to hire, which suggests there may be an upward revision next month.

As Southbay Research notes, there were several other factors that actually depressed the seasonally adjusted number from rising as much as 250K, chief among them a sharply negative Seasonal Adjustment (-35K) which took some wind out of the June NFP sails. According to Southbay, “usually we can blame weather (as in 2016), but this is just BLS monkeying around.”

https://www.zerohedge.com/sites/default/files/inline-images/seasonal%20june%202018.png?itok=0mnuD68h

Some other highlights:

  • Manufacturing (+36K): Up on auto (+12K) rebound after fire led to factory shutdowns
  • Retail (-21K): Falls on weak Food (-9K) and weak Merchandise (-18K).  Merchandise stores is Toys-R-Us bankruptcy layoffs
  • Professional Services (+50K): Strong on the back of white collar technical workers (+25K).  relatively weak Temp workers (+9K) suggests some weakness: either lack of supply (insufficient qualified workers at level of pay) or demand (employer demand is softer than surveys relate)
  • Healthcare (+35K): Higher payrolls create more demand for healthcare

Visually:

https://www.zerohedge.com/sites/default/files/inline-images/jobs%20composition%20june.jpg?itok=0tDo-fLH

Looking over the past year, the following charts from Bloomberg show the industries with the highest and lowest rates of employment growth for the prior year. The latest month’s figures are highlighted.

https://www.zerohedge.com/sites/default/files/inline-images/bbg%20jobs%20june%202018.jpg?itok=rI8f14UU

Finally, what trends can we observe from the latest report? As Southbay summarizes, “H1 2018 has been solid and June reinforced the strength”:

  • Not Seasonally Adjusted payrolls are now the highest this business cycle.
  • Year-to-date Payroll (seasonally adjusted) is 213K (vs 2017 181K).

But June itself had the same level of payroll adds (not seasonally adjusted) as last year 2017. So heading into 3Q, the economy is strong but may no longer be surging faster than it was last year, same time, according to Southbay. This may also mean that the peak benefit from Trump’s fiscal policy is now behind us and going forward it will only serve to depress the economic trend line.

Source: ZeroHedge

Is This Why Tesla Executives Are Fleeing? Investors Want To Know

Is Tesla The New Theranos?

I originally started following Tesla as I felt it was a structurally unprofitable business nearing a cash crunch as hundreds of competing products were about to enter the market.

https://www.zerohedge.com/sites/default/files/inline-images/11325d20-260e-46c8-87de-fb9bbec62749.jpg?itok=QPDAqoOh

As I’ve studied Tesla more closely, I’ve come to realize that Elon Musk appears to be running a Ponzi Scheme disguised as an auto-manufacturer; where he has to keep unveiling new products, many of which will never come to market, in order to raise new capital (equity/debt/customer deposits) to keep the scheme alive. The question has always been; when will Tesla collapse?

https://www.zerohedge.com/sites/default/files/inline-images/Tesla-Bullshit-Conversion-Cycle.jpg?itok=O2KMdlapTesla’s Bullshit Conversion Cycle is the key financial metric underlying this scheme (from @ProphetTesla)

As part of my research on Tesla, I decided to read Bad Blood by John Carreyrou, the journalist who first uncovered the Theranos fraud. It is the story of how Elizabeth Holmes created Theranos and then lurched between publicity events in order to raise additional capital and keep the fraud going, despite the fact that the technology did not work. The key lesson from Theranos for determining when a fraud will implode is that there are always idiots willing to put fresh money into a well marketed fraud – so you need a catalyst for when the funding dries up.

The other salient fact was that most senior employees actually knew that something wasn’t quite right, but feared losing their jobs or getting sued if they did anything about it. Therefore, employee turnover was off the charts but no one was willing to risk their career by saying anything publicly. However, when Theranos started risking customers’ lives, the secret got out pretty fast. This is because most people are inherently ethical – especially when they know that their employer is doing something immoral, like releasing flawed lab results to sick patients. Eventually, some employees felt compelled to become whistle-blowers and started to reach out to journalists and regulators. This started a cascading event.

First, one intrepid journalist took the career risk to write about the Theranos fraud. Then other whistle-blowers felt emboldened to step forward and contact this first journalist, as they also wanted their story told – especially as they had already reached out to government regulators who were too scared to investigate a politically powerful company.

https://www.zerohedge.com/sites/default/files/inline-images/2018-07-05_9-30-27.jpg?itok=G3zMzfEt

Once a few good articles had been written about Theranos, the dam broke open and the feeding frenzy began. Other journalists, smelling page-clicks rapidly descend on Theranos; more workers spoke out, more incriminating evidence came to light and then there was a sense of voter outrage. Finally, the regulators who were first contacted by the whistle-blowers many months previously, felt compelled to act – at which point the fraud collapsed and the money spigot shut off.

https://www.zerohedge.com/sites/default/files/inline-images/Tesla-executive-departures.jpg?itok=TEBxT2PFExecutives Fleeing Tesla Is A True Bull Market “Up And To The Right”

We’ve already seen the mass exodus of senior Tesla executives. When they say they “want to spend time with their family,” it really means they “want to spend less time in prison.” Next, we have the first whistle-blowers—there will be MANY more. Currently there are at least 3 different ones feeding information to journalists. Using past frauds as a guide, once we get to this point of the media cycle, the fraud usually unravels pretty fast.  Given the perilous state of Tesla’s finances, they are in urgent need of new capital. The question is; who would want to invest new capital when Tesla is now admitting to knowingly selling cars without testing the brakes in order to hit some arbitrary one week production target? When a company admits that it will sacrifice vehicle quality and even risk killing its customers to win a twitter feud and start a short squeeze, regulators must step in. The question is; what else has Tesla done illegally to hit its targets? We know that Tesla long ago passed over the ethical threshold of selling faulty products that have killed people—what other allegations will soon come to light? Elon Musk demanded that Tesla stop testing brakes on June 26. Doug Field, chief engineer, resigned on June 27. Is this a coincidence? Of course not—Doug Field doesn’t want to be responsible for killing people. I think Tuesday’s article will speed up the pace of Tesla’s bankruptcy quite dramatically and I purchased some shorter dated puts after reading it.

Tesla is the fluke stock-promote that found a way to address society’s fascination with ‘green technology’ and the ‘next Steve Jobs.’ Elon Musk eagerly stepped into the role of mad scientist and investors gave him a free pass. It now increasingly seems that everything he’s done for the past few years was simply designed to keep the share price up, keep the dream alive and raise more capital – as opposed to creating shareholder value. Along the way, customer safety has been ignored in order to hit production targets and appease the stock market. In addition to not testing brakes, a recent whistle-blower has accused Tesla of installing over 700 dangerously defective batteries into Model 3 vehicles.

I suspect there will be many more allegations as whistle-blowers come out of the woodwork. It really is the Theranos of auto makers. I suspect it will all end soon. Theranos and Enron both collapsed within 90 days of the journalists getting up to speed. The reporters now know the right questions to ask and Tesla will be out of cash by the time they are all answered.

https://www.zerohedge.com/sites/default/files/inline-images/2018-07-05_9-33-07.jpg?itok=kqXN3GzmStock Promotion In Overdrive Lately. What’s Elon Trying To Distract People From?

Besides, Elon Musk isn’t even all that innovative. Hitler already tried this same automotive customer deposit scam 80 years ago (From Wages of Destruction)

https://www.zerohedge.com/sites/default/files/inline-images/2018-07-05_9-34-55.jpg?itok=Cc-tNH4U

Source: ZeroHedge | Submitted by Kuppy Via AdventuresInCapitalism.com

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“Short-Tempered” Musk Reportedly “Snapped” At Staff Working 12-Hour Shifts In Model 3 “Production Hell” Week

https://www.zerohedge.com/sites/default/files/inline-images/Elon%20Musk_0.JPG?itok=x0ZWpkN6

The conditions at Tesla’s production facility leading up to meeting its Model 3 production goal have been reported as nothing short of hellish as Elon Musk “barked” at employees working 12 hour shifts, bottlenecking other parts of the company’s production and reportedly causing concern by employees that the long hours and strenuous environment would cause even more workplace injuries and accidents.

Why You Should Care About The Narrowest Yield Curve Since 2007

Money manager Michael Pento is sounding the alarm because we are getting very close to something called a “yield curve inversion.” Pento explains, “Why do I care if the yield curve inverts? Because 9 out of the last 10 times the yield curve inverted, we had a recession… The spread with the yield curve is the narrowest it has been since outside of the start of the Great Recession that commenced in December of 2007… The last two times the yield curve inverted, we had a stock market drop of 50%. The market dropped, and the S&P 500 lost 50% of its value.”

For those who don’t have enough money to require professional management, consider storing water and food because that will never go out of style.

Source: by Greg Hunter | USAWatchdog.com

U.S. Chamber of Commerce Launches Yet Another Financial Campaign Against U.S. Workers and Main Street…

Today U.S. Chamber of Commerce President Tom Donohue announced another campaign to protect and defend his Wall Street contributors against initiatives that benefit Main Street U.S.A. This is not the first time, and unfortunately it will likely not be the last time.

For a great historic reference consider THIS ARTICLE from 2014; when the U.S. Chamber of Commerce announced their direct attack against the Tea Party backed candidates that threatened to remove the massive lobbying power of Tom Donohue’s corrupt officials. That 2014 reference point has two parts. I strongly urge anyone who would defend the U.S. CoC approach to read both.

https://theconservativetreehouse.files.wordpress.com/2017/12/shameful-seven-with-donohue.jpg?w=621&h=527

The overwhelming majority of economic punditry and opinion come from salespeople on the purchased payroll, direct and indirect, of the chamber. It is one of the most, check that, it is the most corrupt and abusive enterprise in the history of our nation. They are pulling out a very familiar playbook.

(Reuters) – The U.S. Chamber of Commerce on Monday denounced President Donald Trump’s handling of a global trade dispute, issuing a report that argued the tariffs imposed by Washington and retaliation by its partners would boomerang badly on the American economy.

The Chamber, the nation’s largest business lobby group and a traditional ally of Trump’s Republican Party, argued the White House is risking a global trade war with the push to protect U.S. industry and workers with tariffs.The group’s analysis of the potential hit each U.S. state may take from retaliation by U.S. trading partners painted a gloomy picture that could increase pressure on the White House from Republicans ahead of congressional elections in November.[…] The Chamber is expected to spend millions of dollars ahead of the November elections to help candidates who back free trade, immigration and lower taxes. It has already backed candidates who share those goals in Republican primaries. (read more)

The U.S. Chamber of Commerce consists of a massive multinational DC lobbying group that four consecutive administrations’ have allowed to write the actual language in U.S. trade deals and trade negotiations.  Bush, Clinton, Clinton, Bush, Bush, Obama, Obama all gave the U.S. Chamber of Commerce the keys to the U.S. economy, and walked away.  The U.S. middle-class was nearly destroyed in the process.

CTH has stood alone, for years, against the insufferable horde of CoC political mouthpieces and their media conscripts.  The U.S. Chamber of Commerce is at the corrupt center of almost every scheme that fund the Deep Swamp to the detriment of our nation. They are the most vile and insidious UniParty group of lobbyists in Washington DC.

Until Donald Trump came along, they held virtually unlimited power over the U.S. economy.  The Chamber is a cancer; and any politician who associates with that abhorrent group should be excised from existence with extreme prejudice.

https://theconservativetreehouse.files.wordpress.com/2017/07/the-big-club-4-e1500321906624.jpg?w=621&h=858

Source: By Sundance | The Conservative Tree House

“These Guys Are Like Diamonds” – America’s Trucker-Shortage Hits A Crisis Point

Nearly every consumer product – from food, to textiles to electronics – sold in the US at some point touches the bed of a truck. Which is why the shortage of truckers to ferry goods across the US has become such an intractable problem for American companies – and unemployment at 3.8% isn’t helping.

A shortage of workers is forcing trucking firms to raise wages and provide other incentives as they seek to fill an “official” shortage of 60,000 jobs that some industry insiders say is really closer to 100,000.

https://www.zerohedge.com/sites/default/files/inline-images/2018.06.29shippingcosts.jpg?itok=X5XIPNG2

And as companies become more desperate, they’re willing to take a look at applicants who never would’ve had a chance under normal circumstances, according to the Washington Post.

At TDDS Technical Institute, an independent trucker school in Ohio where Blocksom has considered enrolling, veteran teachers say they have never seen it this bad. They say there may be closer to 100,000 truck driver openings.

“As long as you can get in and out of a truck and pass a physical, a trucking company will take a look at you now,” said Tish Sammons, the job placement coordinator at TDDS, whose desk is full of toy trucks and fliers from the companies that call her daily begging for drivers. “I recently placed someone who served time for manslaughter.”

WaPo‘s story opens with an anecdote about Bob Blocksom, an 87-year-old retired insurance salesman who is searching for a job after having not saved enough money for retirement.

https://www.zerohedge.com/sites/default/files/inline-images/2018.06.29bob.JPG?itok=OoU2B35h

And trucking companies, as it turns out, are willing to give him a shot – even as most employers wouldn’t consider a man his age. The only thing holding him back? Being away from his wife of 60 years.

LAKE MILTON, Ohio — Bob Blocksom, an 87-year-old former insurance salesman, needs a job. He hasn’t saved enough money for his retirement. And trucking companies, desperate for workers, are willing to give him one.

Age didn’t matter, they said. If Blocksom could get his “CDL” — commercial driver’s license — they would hire him for a $50,000 job. One even offered to pay his tuition for driver training school, but there was a catch: Blocksom had to commit to driving an 18-wheel truck all over the United States for a year.

So far, that has been too big of an ask for Blocksom, who doesn’t want to spend long stretches of time away from his wife of 60 years. “The more I think about it, it would be tough to be on the road Monday through Friday,” he said.

Wages listed in the story ranged as high as $80,000 a year – plus benefits. And some companies say they’re considering raises because that still isn’t enough to appeal to young people. Already, WaPo says, companies like Amazon, General Mills and Tyson Foods are passing higher transport costs onto consumers. Wal-Mart even identified rising transportation costs as the biggest “head wind” facing the company.

“This is slowing down the economy already,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group. “If it takes me a week instead of two days to ship products from point A to B, I’m losing potential business.”

Even with new federal regulations mandating that truckers log their hours so they don’t breach the maximum 11-hour daily limit, being a trucker is a “hard job” that takes “a special breed” of person. New truckers often gain weight from sitting all day. The periods of separation often strain interpersonal relationships, and divorces are common.

things GIF

Trucking is also surprisingly dangerous: There were more than 1,000 fatalities among motor vehicle operators in 2016, according to the Labor Department. That means being a truck driver is eight times as deadly as being a law enforcement officer. Obtaining a CDL also takes months of schooling and can cost as much as $7,000. Unsurprisingly, a growing number of candidates are failing the mandatory drug tests that are part of the application.

The community around TDDS is full of shuttered factories and bars named “Lucky Inn” and “Horseshoe.” The steel mills closed in the 1980s, and a GM factory just announced more than a thousand layoffs. One of the only industries growing in the area is trucking, yet locals are hesitant to become truckers.

One man, a janitor, hanging out at Larry’s Automotive repair shop in nearby Warren, said his uncles were truckers and told him they would “kill him” if he ever got into the harsh business. The owner of the shop said he had thought about becoming a trucker but decided it wasn’t feasible after he had children.

Trucking jobs require people to leave their families for weeks at a time and live in a small “cabin” with a hard bed. Divorces are common, veteran drivers say, and their children forget them. A life on the road is often costly and unhealthy. Drivers sit for hours a day in diesel trucks and pull into truck stops that typically serve greasy hot dogs and chili.

Weight gain and heart disease are common, says Gordon Zellers, an Ohio physician who spends half his time examining truckers and administering drug tests, which increasing numbers of CDL applicants fail. He advises the TDDS students to see a nutritionist, but he knows most won’t.

Even companies that don’t require their drivers to go “over the road” – that is, make long-term hauls – are struggling to recruit.

“These guys are like diamonds right now,” said Jason Olesh, a vice president at Aim Transportation Solutions who left his family vacation to rush to TDDS to talk to students. “We’re down 90 drivers across our fleet of 650.”

Olesh gave his best pitch to the students: He offered them jobs that pay $70,000 a year with full benefits and regional routes hauling water to oil-drilling sites that would have them home most nights.

“I’m offering you a regular job with a 10- to 12-hour shift so you can see your kids,” Olesh said.

The worker shortage has, unsurprisingly, led to a wave of poaching that has sent the industry’s turnover rate to 94%. At this rate, companies and consumers better hope that Elon Musk succeeds with his goal to launch a fleet of autonomous trucks several decades ahead of schedule.

Source: ZeroHedge