My longtime Rotarian friend, Dick Puhr, late sportswriter par excellence for this newspaper, used to write an occasional column he called Dissa and Datta, if I remember correctly. Today I am following his lead with some information and opinion on a variety of topics, but all related to economics and finance.
First, President Obama yesterday vetoed the bill allowing the Keystone Pipeline to be built. Score one (theoretically) for environmentalism. Another major winner is Warren Buffet, other owners of Berkshire Hathaway’s BNSF railroad, and the other railroads. They are so busy carrying crude from the Dakotas south and east they don’t have capacity to haul their usual loads of goods and grains.
We must favor prairie dogs over people living alongside tracks like those in West Virginia in the recent horrific explosion and spillage from a train carrying 3 million gallons of crude oil. Bakken crude is lighter than other forms of oil and apparently has a lower flashpoint and is more dangerous to ship by train, according to The Pipeline and Hazardous Materials Safety Administration. (Bloomberg.com/news/articles/2014-01-02.)
Since the nation of Canada stood to benefit greatly from the pipeline, President Obama has also stuck his finger in our best friend’s eye. Now their new western oil will be shipped west to the coast by train and to China by tanker ship, not exactly the most environmentally friendly methods. Of course, construction workers and others may be consoled since the administration is really for them and anyone seeking a good paying job. (My tongue is hurting my cheek!)
Meanwhile, the West Coast seaports may be back to more normal cargo passage in a couple of months. There was a tentative agreement reached late last week covering about 20,000 dock workers. There are no details but employers said that many workers were already earning over $140,000 with overtime while the union said most workers only receive about $82,000. Whatever their gains might be, I can guarantee that more ships will bypass them and travel through the newly expanded Panama Canal to Southeast ports with lower paid dockworkers while also saving money on truck and rail transportation costs.
I’m not sure whether it is good news or not, but the Kansas City rental market has led the nation in recent price increases at 8.5 percent year over year through January. National occupancy of rental housing has risen to 94.6 percent while homeownership has declined to 64 percent of our population. So, bad news for renters and good news for landlords and those who will build more apartments. This is according to the Census Bureau and Axiometrics, an apartment research firm, both cited by First Trust Advisors, L.P.
From the current looks of the stock market, February gains will make up for the lousy January losses. There are another few days left but most parts of the stock indexes, especially the growth style vs. value, are now positive by 2 to 5 percent year to date. First Trust’s Brian Wesbury is still firmly in the bullish camp in saying he expects this to be the record setting seventh positive year.
(Past performance is no guarantee of future results. Advice is intended to be general in nature.)
