Global Trade This Week – August 1st, 2022
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Keenan Brugh 0:00
You're watching Global Trade This Week with Pete Mento and Doug Draper.
Doug Draper 0:09
Okay, everybody, it's a new week. It's a new month. And it's a new edition of global trade this week. I am your co host, Doug Draper. And on the other side of the coast is my good friend, Mr. Pete mento. Peter, Monday weekend what's going on? How you doing?
Pete Mento 0:31
I'm alright, buddy. First of all, Doug, I think we need to address what's going out with your face. You know, I brought it up. I brought it up before we started today. It looks like your looks like you've grown a beard. But yeah.
Doug Draper 0:48
Yes, the weekend edition. Right. So I will. I'll take it down. Next couple of days. But yeah, if he'd if I want to. I can take care of it. I can get it done. little gray around here, which I don't want to admit. But yeah, I appreciate you noticing.
Pete Mento 1:07
Well, I think you know, Keenan has what can only be I mean, it looks like he's like a badgers have been growing on his face that there's always something really amiss with that facial growth he's got going on. And you know, I have a beard. Very fetching very masculine look. I don't see why you can't go full. Mountain Man. Doug. I think it would look great on you. I think he would look very handsome with a beard. Now that you don't look handsome now. You're very handsome man duck. But I think appear to be good for you. Yeah, well,
Doug Draper 1:39
how about this? I'll give it a whirl for next. for next week's edition. Yours is very Sean Connery ask I will admit.
Pete Mento 1:47
Yeah. Sean Connery. I do love Sean Connery. Very much. A Yeah.
Doug Draper 1:54
Now you're in a great mood. Now you're in a great mood to get the show kicked off?
Pete Mento 1:58
Oh, no, no doubt. I'm not in a great mood. No, no, I I work in E commerce. And, you know, I'm not. I'm not in a great mood. I'm getting ready for Christmas. So yeah.
Doug Draper 2:14
Yeah, well, it's gonna be more of the same maybe in this in this industry. So how about this, we got to remind our audience cap logistics, pushes the buttons turns the leverage to make this show possible. So we want to thank them. Cap logistics.com Check them out. And Pete with that, by our way, my friend what you got? You're all fired up?
Pete Mento 2:36
Yeah. So let's have it, Doug. So we live in a time when, you know, if you don't like something, you can just rename it. You if you if you if you don't like, if you don't agree with something, you can simply say that it's just not what it is anymore. You know, I don't want to get too politically incorrect here. But in 2022, if you don't agree with the basic state of something, you can generally find someone to tell you that it's okay. And that you don't have to accept it. Your reality is of your own making. And I personally get a kick out of this because I dug in a man of science. I'm an economist. Which of all the social sciences is without question, the weakest on the social on the science. And probably the strongest on the social it is it is trash science. We live in a world where most economists can't do math. So that should give you some indication of just how horrifically pointless the entire idea of economics is. And last week, we talked about all these interesting pieces of economic data were coming in, you know, we had, we had information about what was going on with the GDP. As we expected, we rolled back we had information coming in about an unemployment rate information coming in about inflation, we had all kinds of amazing information coming in. And if you have, generally speaking, historically speaking up two consecutive quarters have backward GDP. So two consecutive quarters of not just no growth. But losses in GDP, are considered to be the R word Oh, recession. Da. But because we no longer believe in anything anymore. Up is down, down is up black as white cats or dogs, dogs or cats. If you can find someone, anyone to agree with your opinion, no longer recession. Now you have everyone telling you that because jobs are plentiful. And you know there are people working everywhere. There's nothing to worry about there is no recession. Well, I'm here to tell you, there is a group that historically has been responsible for determining whether or not we have a recession. They called the National Bureau of Economic Research. They are an independent group of economists. There, there's a crap ton of people actually, in the NBR. Anyone who has done important fiscal research in economics can be asked to join. But there's an independent group of eight economists that do the actual analysis to determine whether or not an economy is in a recession. Here's the thing though, it takes them a long time to decide whether or not we're in a recession, because they go through all the numbers. So what they've said in the past is, the way we usually do it is we look at whether or not there are two consecutive quarters without growth, and that's a recession. But now, these eight independent economists are under pressure. To say that that's not the case anymore. And that because of where we are, I mean, come on, let's face it, no recession. And that's ridiculous. We are in the midst of a recession. We have said on this show many times. I believe I said it about a quarter ago that we probably already were in one. And there's a very good chance that by the end of next quarter, we'll be out of it. Not saying that we're in a recession is absolute gobbledygook, hogwash, horse pucky. We are human beings, we are sentient beings. And we should be able to not only understand the world around us, science, but except the world around us. Call that being adults, and then work to change the world around us and call that being better people. And if you can't accept simple facts that have been in play forever, and you have to change all the narratives and change all the definitions. Well, that's just childish. And I'm a little angry about it, Doug, will be angry about it.
Doug Draper 7:18
Yes, well, I'll tell you what, I think Ferris Bueller kind of said it best, the world moves pretty fast. And if you don't look around, you're gonna miss it. And that comment is gonna lead into my first topic, but But first, everything moves so damn fast now. And I love the fact that you said by the end of next quarter, maybe by the end of the of the year, we're going to be pivoting into something totally different. Things just move quick. I don't know if it's the drive by media that helps do it. I don't know if it's consumer buying habits, a combination of both. But the fact that economists take time and old school manner to tell us what's already transpired two or three months ago. I mean, that that's, that works back in the 70s and 80s, I guess. But I think the key point that I take away from your comments, Pete is things move so fast now that applying the same rules and the same philosophies to what we're in now, the here and the now is forever changing and doesn't work anymore. So yeah, I think we're in a recession, I think it's kind of unique recession, because of all the peripherals that you just described, that kind of confuse the definition. And we're gonna fast forward this thing is going to be, we're going to be through it pretty damn quick. I don't know if it's a quarter or not, but I'll trust your judgment on that. It's gonna happen quick.
Pete Mento 8:39
Doug, I don't think when a recession, I know we are because we are in the classical definition of what one is. So we can give it a brand new name, we can call it the the ugly, bubbly abracadabra, recession if we want. But this is a recession. So we can call whatever the heck else we want makes us feel better. We live in a world where if we don't like the facts, we'll find someone else to tell us it's all okay. What are the main problems with this business environment is that if you don't like the outcome, and you don't like what's being said to you, you can find someone else to tell you that math is math baby. And this math points to the fact that we are in the shitter. Now, we're not going to be here for very long, but we're there. And what comes out of this is going to be just as broken as what we're in now. That's a topic for another show. Which Treforest
Doug Draper 9:34
Nice. Well, this one goes along with what I just said about things moving quickly. And basically that I was trying to think of a fun catchy title on this one and I came up with below Have we met before? Question mark. And then like, you know what the bottom line is that returns management. And excess inventory is probably the toughest job we have nowadays in the supply chain. There's just crap everywhere. You It's in warehouses. It's on boats. It's in transit. It's rolling warehouses. And there's a whole bunch of stuff. as you just alluded to Pete, there's a whole thing called fourth quarter holiday season, where all the styles trend change, the seasons change. And we got to get that stuff out. And not only challenge I repeat is, yes, it's in the warehouse. Yes, we sell it. But what's transpired, especially during COVID, is everybody's like, yeah, I don't like it. I don't like the aqua blue, I want the navy blue. And so there's returns coming back into the system as well. But what's clogged, a lot of returns coming back in so if your individual having to manage that within your organization, and I know right now you're thinking of three or four names at your company that are having to do that. It is it's catastrophic, may be the wrong word. But here's the bottom line with things moving fast. P 2021. was all about goods. We talked about goods and services stuff, people wanted to buy things because they're in their house. And as we spoke about 2022 is all about services and experiences. Well, the forecasters were like, hey, our clients are buying all this stuff. And it's 2021. And we need to forecast for 2022. So buy, buy, buy, buy, let's double down, people are going to want more stuff. Well, stuff just doesn't appear. And stuff has to go the supply chain, which is what we talk about all the time. And, and it's delayed. And the consumer buying habits has changed dramatically. From goods now to services and experiences, that is a fundamental reason why there's so much stuff. And I could use a different term that's in the midst of our supply chain. people's expectation is if I don't like it, and I don't care where I bought it, how I bought it, or how it got delivered to me, I have the right to return it. And so the returns are in the system, a backlog is in the system. And it's it's crazy. So Pete, one thing I'm going to try to do more and more as we always hype about a forward lean in our discussions like we can talk about what happened, which is kind of what I just did at least brought some light to where we are. But I think what's going to transpire and we're going to see is that there's going to be more and more tech advances with getting visibility on returns specifically, where is it? How can I divert it? How can I get it out of this craziness that's coming at me as far as more goods for fourth quarter. And now the thing that I spoke about him as a prediction back for 2022 is keep things local, right? Don't let it leave the market. Once it's there, resell it, repurpose it, get rid of it in some form or fashion but to bring it back through the traditional supply chain of how I got there is infrastructure is not there to handle it. So I think you're gonna see a lot of companies enlisting local name, say side hustles people that want to get a little extra money. You're gonna see liquidators coming through the woodwork. Because if I'm a retailer, and I have millions of things, I got a couple of 100,000 toasters and microwaves I gotta get the hell out of here because I have holiday stuff coming in. I'm going to sign one Pio send it to a liquidator. So there's going to be tech around it to get visibility liquidators are going to crush it. So if you're looking for some investment strategies, the dollar stores and the discount stores I think are going to be very successful in the upcoming years. And, and that's it so returns are just jam and more stuff up and the consumer buying habits pivoted so quickly, like you made mention to on the the economic topic. We're still in a hurt my friend, we're still in a hurt.
Pete Mento 13:46
Well, first of all, the topic of toasters if anybody needs a toaster www.wayfair.com fantastic selection of every conceivable type of small appliances for home at incredible prices and amazing delivery. But, you know, On a sidenote duck, the, the true the true stumbling block of ecommerce right now is managing the volume of returns. And so much time and effort is being put into overcoming this mean that getting stuff to people was was was a Herculean task. And that that's how we build people. Right? That's, that's how the money comes to the door. So what you want to talk about a motivation, right? You want to get paid to come up with some smart ways to get it there. But then the customer satisfaction is how you keep them coming back over and over again. So trying to come up with smart ways to say to them if it didn't fit or didn't work, or if it just wasn't for you. Quick and easy returns and so much money. So much consulting effort, so much time is being spent a trying to overcome this problem. And I don't know if anything has stuck, man, I, I love what Amazon has done. As a guy who probably goes to Whole Foods a little more than I probably should, you know, I love going to Whole Foods and picking up stuff there. But it's also very convenient when I have to do an Amazon return, that I just show up with my stuff at Amazon, they click the U UL URL code on my phone, and I'm done. They just say thanks a lot, they put it in a plastic package, they put a sticker on it, and I'm done. And then I probably spend 10 times whatever my return is on fresh fruits and vegetables and some salmon before I leave, but you know, they really get me when I walk in there, you know. But that's one way that I feel the number of times I've remarked Oh, wow, that was easy. Like I felt I felt happy as a consumer. But when I have to do something with Nike, as an example, you know, I'm a sneaker head, I've talked a lot about that. And when I get a pair of sneakers, I have to return them. It's not like it's that difficult for me to print out the piece of paper or to show up with my phone at the UPS store and say I have shoes I have to send back in the exact same package with a new piece of tape. But man, you think that I was rebuilding the Manhattan Project, I complained so much. Because compared to Amazon, it is a pain in the ass. But compared to 10 years ago, that's nothing. It's nothing. And the number of times that I bought something online, and the Chinese retailer said, Just keep it in what do you say, you know, we give you 30% off something if you buy it 50% off, you know, we'll give you $10 in credit on something about that was 20 bucks. If you use it in the next 24 hours, you're like, wow, I wasn't happy with this piece of crap you sent me maybe I'll be happy if I buy another piece of crap. And I have $10 off of it. But it works. So Doug, you could not you could not be more correct. And that this is the this is the real sort of Rosetta Stone problem that is facing ecommerce right now. I don't think that anybody has really figured it out yet, but it is ripe for experimentation. And we should be encouraging it. We should be encouraging it on every level, trying things out. And at least putting our best efforts into it and investing in better ideas. Yeah,
Doug Draper 17:19
agreed. Well, thanks for that vote of confidence, my friend. That is a perfect segue into halftime. Halftime to talk about today. You got it. You
Pete Mento 17:31
want to go first time. Sure halftime brought to you by our friends at CAP time. Kappa Kappa logistics, thank you cap logistics for allowing us to come here every week and probably embarrass ourselves in your good name with our content that that our good friends at CAP logistics bring to you every week cap Logistics is a wonderful company. If you are in the market for help getting your goods across borders, breaking into foreign markets and trying to find ways to have a better, more secure, more efficient supply chain. do reach out to cap logistics at WWW dot capital just x.com. Doug I hate Summit. I've put so much thought into this. About why June July and August, I get so cranky. I really don't care for summer. And there's a lot of reasons for it. The first of all, for who I don't really like hot weather, I can deal with it. You know, I'm a Louisiana lover. I'm from Texas, and you know I can deal with it. But if you want me to walk around outside retype our paths. So you know, that's like the first part of it. Second of all, everyone takes off all this time. It's like, oh, the kids are out of school. So if you want to get the business done too bad. No, no, I don't get that. I don't get why half of our country has to take off half of this particular season. And then in Europe, it's even worse. You know, there are entire segments of like Francis an example take the entire month of August off. I don't mean the hearts of August. I mean, the first read the end of the month, no work, they take the whole month off. So good luck trying to get stuff in our business done. You know that I get it. Self care. It's 2022 Pete give it up whatever, right? I don't like outdoor activities as much as I used to like to play sports. I'm not keen in you know, munching on Gorp running up a hill in my techniques. You know soaking up sunrays playing outdoor disc golf or whatever. I mean, come on man. Read the book, you know get get inside. Air conditioning is one of the greatest inventions in the history of mankind. Have it for reason. Don't like Summer, Fall. Fantastic. All wonderful, right kind of weather for powerful built man with You don't like the snow? You like the season and spring wonderful. Love it. I like a little moisture in the air doesn't get above let's say 75 You know suns not all the time. I like binge watching television while it's dark out. Son shouldn't be up at 830 at night. That's wrong. So, Doug, I hate summer. I absolutely. And I think I need to move someplace where it's not so pronounced to the season.
Doug Draper 20:26
Wow, that is passionate. And I wasn't sure that right there my friend is Get off my yard guy, right?
Pete Mento 20:34
Oh, I'm totally off my lawn. I am. Yeah, birthday was last week. And I spent most of my birthday reminding people that I'm an old crank. And I've been an old crank since I was 30. And that was 20 years ago. So yeah, like I am I'm a cranky old man. Yeah, yeah. Well,
Doug Draper 20:53
I love all the seasons probably my we're not going to go into a season discussion but of course
Pete Mento 20:59
I'm sure I'm sure you've got like your Magnum PI short shorts that you were around while you're mowing the lawn whistling yourself with your headphones in listening to am radio baseball that all summer so fantastic. kick rocks Yeah, summer sucks.
Doug Draper 21:13
I was I was doing jumps off the diving board yesterday with my with my son and I'm gonna you have this tell me Pete if this is a a made up story right here or the truth. I decided to do the jumpsuit in a black Speedo that I used to wear in high school when I was a swimmer.
Pete Mento 21:31
True if you were a swimmer, I'm gonna go true. I'm gonna say true. And I bet they probably still fit
Doug Draper 21:39
that statement is false. But yeah, but I was on the diving board with my son doing flip I can still do one and a half. without looking too stupid. So anyway, I love summer. I love spring, fall and winter. They all have their pros. I love it.
Pete Mento 21:57
There is but one season there does fall. That's when football starts. That is it is it is the perfect season I am in New England or and that is the perfect season is before the snow starts. And everything is miserable. So we have Thanksgiving, Doug, you don't know what you're talking about. You've been around those hippies too much to get back from Midwest my friend. No, we have to.
Doug Draper 22:20
All right, this one's kind of cool. Some of the folks out there may have heard about this, because it popped up like in the last 24 hours. But I'm talking about famous birthdays. And this is once a milestone, and I'll have to set the stage here. But George Jetson birthday was yesterday on July 31 of 2022. Now how do I know that is the Jetsons show. And for those of you that may not know it's a middle age. Or excuse me a middle class family. You got four kids or two kids. Like they were Elroy and Judy. They live in a space town called orchard cities. That's right, you know, everybody knows song. I didn't know it was called orbit study that was new to me. But it debuted in 1962. And it was set 100 years in the future. So that means it was 2062. And there was a reference when the show started that George was 40 years old when the show started. So you take 2062 Subtract 40 It's 2022. Not really sure where July 31 came from, but George Jetson This is his year of birth. Wow. And so that's, yeah, number one. That's pretty cool. The other thing that was that that led me to this one is okay, how many predictions and the technologies did they highlight in 1962? For their two or three, four episodes actually have come through this far down the road. So one of which so there's a couple of them, I'm gonna give you a couple of truisms and a couple that didn't happen. So, video communication, if you remember, there was a lot of during the show, they'd stop and they'd have a video conference or something of that nature. So predictions of video communication, technology, I'd say that's happened. That was a prediction that came through smart homes. I know they had Rosie, the maid which she was pretty kick ass loved her favorite character in there because she could make sidebar commentary on all the characters and play kind of the straight man and move on and you could laugh at her at our commentary, but smart homes zipping by and turning on lights and starting things and and all the smart technology that we've developed really probably in the last five years that's all all comes to fruition. Industry automation. Mr. sprocket Spacely sprockets. Yeah, you know, pretty sweet automation there in his factory. And I'd say yeah, there's some pretty sweet automation that we have. So check that one out. service and personal automation, ie robots. Rosie, specifically, not quite there yet, right, we got the Roomba that zips around. And I'm sure there's some MIT robots that have gone around and talk about how they can pick up a cup of coffee in the corner of your room or something. But for the most part, personal robotics and personal automation isn't quite there yet. But you know what, I'll give those creators and the writers of the Jetsons a little little kudos because a lot of stuff they spoke about is come true. Love it. So there's my halftime Happy Birthday George Jetson
Pete Mento 25:35
flying cars over what there's a lot of in the Jetsons. Doug, what's that? Drones? A lot of drones? But
Doug Draper 25:46
no, it? There are, I have to admit, you could define a flying cars as a drone. But anyway, live drones. Pow. Yeah, now. I'm gonna move on from that one. So
Pete Mento 26:01
yeah, I'm up next. So, you know, the second one is interesting. Will there be a peak? So we had heard about this double peak, you know, peepee, were back to school was going to be mixed up with Christmas all at the same time. And the near the COVID mix up out of China, is there going to be peak season? I don't know. There's a lot of freight news that came out this week. A lot of data that's coming in from the folks who matter the folks that we watch that showing a pretty steady volume of ocean freight. So steady, not a massive increase, but not a decrease either, that maybe we're at a plateau. So rather than a peak, you sort of hit maximum velocity. And this is where it's going to be through Chinese New Year Lunar New Year, that this is what it's going to be then. It's a ways that you can see this in the retail environment. Many of the large retailers have already brought in back to school, not only they brought it in, but they have it display, I was at target this weekend. And full display ready to rock and roll back to school is their same thing at Staples, Home Depot, Home Depot, Office Depot, these are all ready to rock and roll Walmart as well. If you go into any of the rival pages, home pages, for the large, big box retailers already starting to go for back to school. A big part of that, of course, are the liquidations that you were talking about this early movement that we're seeing to try to push as much inventory as possible, much of it being branded as back to school sales. Although it has nothing to do with going back to school. I don't know what flatscreen TVs have to do with going back to school. I wish my parents would have bought me a television. I was going back to school but with their marketing it is kids are going off to college. I want to give them that 60 inch flat screen to go in their dorm room. And then you look at you know my industry, you have a lot of people who are putting in the time and the effort for the home goods on the back of school dorm rooms as well. Whether it's Amazon, Us, Walmart, Target, seeing a lot of that in ads, as well as home in retail, I think we're going to see a lot of power is this liquidation mentality that's going to come through the Christmas season. You're going to see the Black Friday, followed by Black Saturday, followed by Black Sunday, followed by Cyber Monday, Black Monday, cyber Tuesday, Wednesday, Thursday, Friday, Sunday, you are going to see a Christmas of oh my god sales followed by a January 1. Just pure liquidation of stuff going all the way through presidents, where people are going to just say it's gotta fly out of here. It's gotta go, everything has to go. Because that is when the supply chain is finally going to catch up. We're going to see where we are as far as volume goes the blank sailings what's being taken in and out of inventory for vessels. And we're probably going to start to slowly get back to that normal. And I'm telling you, buddy, I think there's going to be a peak, I think right the plateau we're gonna start backing down from that plateau finally at some point, mid March Yeah
Doug Draper 29:14
100% agree specially with the fire sales are going to occur at the first of the year. Right there. There's going to be executives all over the country saying we've had this crap on our books for the last six months and we got to get it off. It's too expensive. How's it too expensive to ship it? Get rid of it now so I think that there'll be some massive sales like you said, pre Christmas, but I think January is gonna crush it there's going to be multiple multiple sales. Amazon will probably create something and spin it everybody else will follow but I think it's you know, it's talked about buyer and seller markets definitely a buyer market in in goods as it comes up to the consumer
Pete Mento 30:00
Uh, Doug, you know, what we're already hearing about, buddy? We're already hearing about a second Prime Day. Yeah. So think about that. And then second of all, when you think about this massive liquidation of inventory, I think that's good for the integrators for the DHL UPS and FedEx is of the world who are ultimately going to end up moving this stuff that consumers, I think that if I were looking at a stock to maybe consider, I'm not so sure about going along on freight forwarding stocks, or ocean carrier stocks, but these integrators, someone has to move this liquidated merchandise to the end consumer and ecommerce, it's going to be FedEx ups and US Postal Service. And I know how much you hate the US Postal Service. You know, FedEx and UPS, I think there's going to be an opportunity there for just continued financial opportunity for those companies. Yeah, agreed.
Doug Draper 30:46
I man, I'm gonna wind this down with something we spoke about
Pete Mento 30:50
last week, or the or the week before,
Doug Draper 30:53
but the whole 85 Assembly Bill five out in California, everybody's probably heard about it that's in this industry, but it restricts businesses from classifying workers, as you know, independent contractors rather than employees. So I always like about our half talked about not always drive by media, you know, sound bites or whatever. But we're going to start really seeing the ripple effects of what this means to us as a consumer. Over the next several years, I was going to say mon speed, but I think several weeks, we're gonna see it discuss things move so quickly. And I say that because there's two very large carriers out there that have made a statement on how they're going to manage this in completely opposite different directions. So two approaches, either get on board, or get out of it. So who's getting out of it? landstar. Right, if you're dealing with landstar. And I mean, by getting out of it, they've encouraged all of their owner operators, it's a heavily owner operated type of of network at landstar. Get out of California, if you still want to play ball with us and have a stronghold and what you're doing on behalf of landstar Get out of California. And JB Hunt, completely the opposite, saying, Hey, we're cool with it. We've talked about it, we've known this is coming down the road. And we've already flipped most of our important lanes and everybody over to company drivers. So completely different approaches to how to handle it. And I think we'll continue to see that moving forward. What that means he this is the most important thing is that we've talked about the big and the small, the large asset base carriers are going to be the winners in this because they can afford to take on all the salary, equipment and absorb the independence that they've been working with the smaller companies, they're the ones they're going to lose out. And what that means is there's going to be a lot of customers or excuse me a lot of carriers that are just going to eject, we have an aging workforce. They've weathered the storm these truckers have weathered the storm has so many changes, so many regulations, so much insurance, so much, so much so much burden to have their independent business. And we've talked about the death of the modern day cowboy, which is the independent trucker, this is just another nail in the coffin that's going to push more of these people out of the market. Some of these guys do not want to go work for the man, they're not going to want to be company drivers, they're at the stage where you know what, I'm going to sell my assets, I'm gonna get the hell out of here. And I'm gonna move to a southern state, and enjoy the end of my life and my years. So I think that's going to be the biggest thing, we're going to see some capacity crunches, because of it, I think the bigger companies are going to get bigger and stronger and be able to weather the storm. But in an over, I'm sure we're going to talk about this again in the future, but you're going to see two divergent topics or strategies I should say on how to deal with this. And it's going to be an interesting ride over the next, you know, five or six months, I will say.
Pete Mento 33:58
Yeah, man, I was really hoping to find a stat before we started talking today. And I didn't on how many of these independent operators have worked for larger companies before becoming independent operators, larger firms. And I can only speak anecdotally. And I'm sure you can, too, of how many owner operators I've spoken to, who got into the business as an owner operator as independent contractor because they didn't want to work for a big company. And that operating model of being my own boss operating my own machinery, kind of making my own schedule. That is, that is the reason the core reason that they operate this way. They want to have sovereignty over their own schedule. They want to make their own decisions about who they do and don't haul for. You don't want to be told to work for this customer or this customer because frankly, they don't like them. They don't like that particular route. And the idea of having to give that up is is sort of, you know, the exact opposite of why they live their lives that way that they If and the idea of having to go back into that line of business that way it makes their blood boil because their skin. So you're going to have a brain drain, I guess what would you call driver drain in that area, which is going to be good for the bigger companies, as you pointed out, it's going to make their services more expensive, it's going to make it even more scarce. But ultimately, it's going to be very, very bad for infrastructure, because it's just going to create more congestion. And it's going to make it harder for us to get that stuff out of there, it's going to put more pressure on the rail, which we've already got enough problems with rail. And ultimately, it's only going to create more headaches for people. So it's just one of these, you know, the best of intentions moments again, the road to hell is paved with good intentions. They tried to come up with a way to bring some relief in this contractor, gig economy mentality. But in the end, what it may have done is it may have cataclysmic economic impacts on the overall California economy in our ability to trade with the west of the East. Excuse me. So Doug, I think you're right. We're not done talking about this. And I think that while all this was going on, someone forgot to talk to the drivers. Sound familiar?
Doug Draper 36:13
But yeah. Nailed it. Nailed. Anyway,
Pete Mento 36:16
yeah. So that's gonna do it for us this week for global trade this week, brought to you by our great friends at CAP logistics. Again, if you have any international domestic logistics needs, please do look them up on the web to learn more at cap logistics.com. They've been wonderful at allowing us to come on here every week and talk about what is not happening with global trade what we believe is going to happen with global trade. Doug and I couldn't be here every week if it weren't for their continued financial support. Want to thank Keenan for being back at the booth and keeping his hair and beard out of the way of the buttons and the dial so that we can continue to keep our content flowing, Doug, as always, I couldn't do it without you would want to anyway, good luck with that beard.
Doug Draper 37:01
Thank you, sir. We'll see you next week. All right. TV.