Since the first quarter of 2022, there has been intense discussion about whether or not there is a freight recession. The apparent conclusion is that spot rates have fallen along with freight volumes this year, as reported by Freight Waves.
This discussion was started by FreightWaves in March regarding trucking volumes and rates, and in June regarding ocean volumes and pricing. Both calls were made months ahead of other market participants in freight intelligence.
While many of our readers and customers were grateful they could protect their businesses, jobs, and livelihoods with this foresight, FreightWaves received harsh criticism from some for making these calls.
Why did FreightWaves make the right decision when industry insiders with in-depth knowledge of the market were unable to do so? Legacy data latency is the key to the solution.
High-frequency, upstream data can power prediction signals well before lagging signs, a fundamental tenet of SONAR. As a commodity, freight is priced according to how supply and demand are balanced. Understanding the direction of freight traffic is more important than using conventional legacy signals.
Our detractors based their thesis on information and techniques that they are accustomed to and have used for years. For companies monitoring global macroeconomic data, advanced signals are less significant in freight markets with low volatility and stability. But since we are living in different times, the freight business is actually affected by volatility.
Here’s how it happened.
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Source: Freight Waves