Our love of buying stuff is putting a strain on the supply chain, but that’s expected to clear after the new year.
PNC Senior Economist Bill Adams and US Policy Strategist Greg Valliere presented their insights on inflation, interest rates, labor markets, and US lawmakers Oct. 5 in Fort Wayne.
The event wasn’t open to media, but I spoke to Adams afterward.
“The distortion happening in the economy right now — where we have a tight job market but also have 5 million fewer people employed than at the beginning of last year, and the supply chain disruptions and inflation problems — a lot of these are tied back to how the pandemic has changed consumer demand in the United States,” Adams said.
People have been spending less on face-to-face activities such as dining, travel and entertainment, and spending more on buying goods, especially durable goods. That has overloaded the economy’s capacity to meet consumer demand and to move them through the supply chain.
Adams had just released a commentary on trade data that showed the trade deficit widened again to nearly a record high, according to the August trade and goods and services report. Consumer goods are waiting to be unloaded from ships in places like the Port of Long Beach in California (where some media are reporting that a half-million shipping containers are waiting to be unloaded) and a backlog of shipping containers to be loaded on ships in China where goods are manufactured as well as a backlog of completed products at factories that haven’t headed to the ports yet.
“That backlog is going to be with the economy for at least another month or two,” Adams said.
Demand for imports could slow after the holiday shopping season.
“At least in the fourth quarter we’re going to be struggling with an overloaded global supply chain,” Adams said.
Horizon Bank completes acquisition
Horizon Bank, a wholly owned subsidiary of Horizon Bancorp, Inc. (NASDAQ GS: HBNC) (“Horizon”), announced the completion of its previously announced acquisition of 14 branches in 11 Michigan counties.
The acquisition of the 14 branches and associated deposits and loans from TCF National Bank, now The Huntington National Bank, expands its footprint into attractive markets in the northern and central regions of Michigan’s Lower Peninsula.
“We are thrilled to welcome our newest employees and customers to Horizon Bank and look forward to serving growing numbers of consumers, small businesses, non-profits, and municipalities through our expanded Midwest footprint and this natural extension of our low-cost deposit franchise,” Chairman and CEO Craig M. Dwight said in a news release.
Conversion of the branches began Sept. 17, and continued through the weekend, with all 14 locations reopening Sept. 20 as Horizon Bank branches. This latest branch transaction is Horizon Bank’s 15th acquisition since 2002 and fifth in the last five years.
Horizon Bank now operates 88 bank branches, including 29 in Michigan, and customers across its diverse and economically attractive Midwestern markets conduct a majority of their transactions through its convenient digital and virtual banking channels.
Customers of the newly acquired branches have received regular communications from Horizon Bank and The Huntington National Bank, and can also visit www.horizonbank.com/welcometcf or call 888-873-2640 for more information.