Bill Wood

Economics Editor Bill Wood says we’re going to be “inundated with bad news at a rapid rate” as the Fed tries to tame inflation without sending the economy into a recession. But he adds there’s no reason to panic, and his outlook for the rest of the year is “balanced.” Going forward, plastics company managers should keep an eye on real estate and construction data, consumer spending and employment data.

Despite all of the turbulence reflected in some other sectors, total U.S. construction spending increased by a robust 12 percent in the first quarter when compared with the same period in 2021.

Despite high inflation and talk about a slowing economy, Plastics News Economics Editor Bill Wood says he doesn’t “see a flashing red light” warning of trouble in the North American plastics supply chain. He does see a yellow light, warning of slower growth. In the April 2022 Numbers that Matter Live, he says managers should keep an eye on interest rates – if the Fed tries to raise them too much, too quickly – and on the value of the U.S. dollar.

Bill Wood: "Markets have acknowledged the Fed's desire to fight inflation with an increasingly aggressive program of raising near-term rates, but it is unclear how this program will work out in the longer term."

Higher interest rates are coming in an effort to combat inflation. Which plastic end markets are vulnerable, and how can the plastics supply chain adapt? Plastics News Economics Editor Bill Wood also discusses supply chain issues and the impact of high energy costs. And should we be worried that a “soft landing” could become a recession?

Bill Wood: "The U.S. economy has recently been hit by two significant supply shocks: the global pandemic and now the crisis in Ukraine. Prior to Russia's invasion, the rate of inflation in the U.S. was already at levels we have not seen in decades. After the attack on Ukraine, prices for commodities such as oil, industrial metals and grains spiked."

Will conflict in Europe add to turmoil for North American plastics processors? In the February Numbers that Matter Live, Economics Editor Bill Wood also covers dealing with inflation, higher interest rates, rising energy prices, supply-chain issues, tariffs and the shift to a more circular economy. It won’t be easy, but there are “tremendous opportunities” for innovative companies, according to Wood, who has tracked the plastics industry for more than 30 years.

Bill Wood: "The U.S. economy is overheating. The irony of that statement is not lost on me as I write this in the middle of winter, and as our nation finally approaches what I hope is the end of a two-year pandemic."

It’s been decades since inflation had a significant impact on the U.S. plastics industry. Economics Editor Bill Wood discusses how higher prices, including for labor, energy and raw materials, will impact the supply chain.

Rising energy prices not only push materials prices higher, but also they push up the cost of running our factories. Resin prices do not follow every wrinkle in the oil market. But, over time, the correlation is quite robust.

Investment in capital equipment got back to the pre-COVID level in the first quarter of 2021, and then it jumped even higher. For the year to date, the inflation-adjusted increase is 14 percent, and it would likely be even higher if not for the supply chain issues.

Due to the pandemic, there is a tremendous amount of pent-up consumer demand for celebrating. But the pandemic has also created an unprecedented bottleneck in the nation's supply chain.

As the fourth quarter gets underway, the U.S. economy continues to struggle with supply chain issues. As a result, we are also struggling with rising prices.

COVID-19, weather interruptions, supply chain shortages and other issues are impacting plastics and the overall economy, Economics Editor Bill Wood says. How do we get to, and then sustain, a Goldilocks economy — not too hot, and not too cold?

Overall, we are still in a very favorable spot in the business cycle. But if peak growth is now behind us, then plastics processors and suppliers may need to adjust their expectations.