In our last blog post “What Causes Freight Booms and Busts?”, we looked at the reasons behind freight booms and busts. And while the freight market certainly experiences its share of ups and downs, it’s human nature to prefer stability. At the end of the day, we’re all trying to carve out our own little bubbles of stability in a volatile world without giving up too much in exchange for that peace of mind. We’d all prefer stable prices, or at worst, “low, slow and stable” inflation.
Solutions for Meeting Volatility Head-On
Flexibility is Critical When Dealing with Uncertainty
Information Transparency: Don’t Confuse More Data with Better Transparency
But we should not conflate data volume with data transparency. In an industry where there are increasingly copious amounts of data, a healthy dose of skepticism is also necessary regarding the independence of the data. Does each incremental byte of data provide unique information about the state of supply and demand, or does it unknowingly herd market participants toward the same cliff? This dual nature of information transparency is well documented by economists.)