Taps Coogan – June 16th, 2021

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As the following chart from Arbor Data via The Daily Shot highlights, container shipping rates are still surging to record highs, particularly to ship goods from China to the US or Europe. Meanwhile, rates from the US to China have barely budged.

East-to-West shipping rates are presumably going to normalize at some point, but the key to this chart is that they haven’t even finished spiking. For a return to ‘normal’ for global supply chains to be in the cards for 2021, rates needs to start dropping fast.

People in the ‘transitory’ inflation camp may very well be right in the long run, but they’d better be prepared for ‘transitory’ inflation to last an uncomfortably long time.

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