We’ve observed the FedEx indicator several times before—here, here, and again here, and once again today the FedEx indicator is flashing a big negative sign for the economy in the weeks and months ahead. “FedEx Cuts Outlook” was the NY Times headline yesterday:
FedEx Corp. says the global economy is stalling, and it’s going to get worse next year.
The conditions are shrinking earnings at the world’s second-largest package delivery company. Factories are making fewer items for FedEx to ship and customers are opting for cheaper delivery options to save money.
FedEx on Tuesday cut its outlook for global growth and industrial production while slashing the forecast for company earnings. And CEO Fred Smith suggested trade has slowed to levels seen during the last two significant economic downturns.
Not even shipments of the iPhone5 seem to be helping much.
Meanwhile, Hudson Institute economist Tim Kane is out with a new report showing just how anemic the entrepreneurial sector of the economy is right now. Among the other startling findings of the report is this one: “There are fewer new firms being formed today than two years ago when the recession ended.” My pal Jim Pethokoukis points to these instructive charts from the Kane report:
Gee, I wonder if there’s a link between this and the U.S. slipping to 18th in global economic freedom?