Truckin’ …

Does automation have a cost?

A recent op-ed in the Wall Street Journal asked, “Daddy, what’s a truck driver?” The article cited advancements in computer software and processing power to posit a future where truck drivers would be curiosities of the past, akin to rotary phones and CB radios. It describes a remote mine in Australia today, where six automated heavy-duty mining trucks sporting engines with 2600 horsepower and 25 million lines of software code run 24/7 using advanced guidance systems and monitored by personnel in a control room miles away.

This kind of innovation has been going on for decades. Farms need far fewer people today to grow corn, wheat, and other products than they needed 20 or 30 years ago. Bioengineered crops and GPS-equipped tractors have made the industry much more productive. Relative food prices have fallen dramatically.

The result is an economy where the natural trend of most prices is downwards, with a few exceptions: labor-intensive industries where consumption is aided by widely-available credit, such as higher education. But there’s no free lunch: over-indebted college graduates who can’t find work are now moving back in with their parents and defaulting on their student loans. Who pays for this?

Douglas R. Tengdin, CFA

Chief Investment Officer

By |2017-07-17T12:34:38+00:00August 6th, 2013|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. - Leave a comment if you have any questions—I read them all! - And Follow me on Twitter @GlobalMarketUpd

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