“Davidson” submits:
Q4 2022 hedge fund letters, conferences and more
Durable Goods Orders released today already in an uptrend have spiked higher. It is well known and the media has frequently headlined that vehicles and aircraft have significantly greater demand than manufacturing has been able to supply due to supply chain issues related to COVID. Today’s report underscores that perception.
Transportation as a percentage of GDP at 8.4% in 2021, was below the historic 10% level-see chart. There has been heavy demand on transportation infrastructure during COVID which has held up post-COVID. Equipment needs replacing and upgrading with the lull in production during COVID. Orders for aircraft announced last year are now showing up in the data and recently there has been a surge in Class 8 truck orders. Both, industries have capacity limitations likely to stretch delivery for several years holding demand higher for longer than in prior periods.
There are no recession signals in this data. Selected manufacturing/service companies are favored the next 3yrs-5yrs.
