Ever since the North American railroad operators triumphantly declared a bottom their industry one year ago, these smooth behemoths of efficiency have translated marginal economic stabilization into remarkably robust earnings growth.

My top pick in the sector has earned its keep once again. Canadian National Railway (NYSE: CNI) scored a 38% boost to net earnings for the second quarter. Observing "significantly higher freight volumes in all markets," the hauler enjoyed a 27% increase in total carloads for the quarter. Adjusting for currency fluctuations, revenue rose 26%. Turning in a phenomenal operating ratio of just 61.2%, Canadian National continues to boast the leanest cost profile of the pack.

Expressing optimism for a "continued economic recovery," Canadian National revised its full-year earnings guidance to C$4.05 per share, representing a 25% improvement over 2009. By contrast, rival Union Pacific (NYSE: UNP) cautioned that "the pace and direction of the economic recovery is uncertain" while revealing similarly strong results. Before deciding which one to believe, Fools may have to do their own digging.

The best trains are the ones you see coming
This powerful parade of earnings from North American railroads was foretold from sea to shining sea.

Ever since robust first-quarter results prompted steelmaker AK Steel (NYSE: AKS) to declare it was "firmly on the road to recovery" -- and equipment maker Bucyrus (Nasdaq: BUCY) shrugged off its first-quarter earnings miss by confidently raising its full-year guidance -- the writing was on the wall for this strong showing for the second quarter.

For Fools adept at reading tea leaves, even the relatively steady rise in shares of Ford (NYSE: F) through the first quarter may have presaged the strong near-term boost in automotive volumes that propelled CSX (NYSE: CSX) to a resounding quarterly success.

Fortunately, for Fools seeking to corroborate their macroeconomic hunches, timely data on freight volumes is available to investors through sources like the Association of American Railroads or Atlantic Systems' Railfax. I scour these tools weekly to spot trends in freight demand, and I encourage curious Fools to try them out.

What are the numbers saying?
Corroborating the whispers of deteriorating industrial demand circulating throughout the bellwether sectors, recent railroad freight data show a recent but noteworthy reversal of what had been a long-standing stabilization trend. Baseline traffic has quickly reverted down to near- prior-year levels, and so far in this third quarter consolidated traffic has only been 6.7% above prior-year volumes. Interestingly, Canadian National's own full-year guidance calls for carload percent growth in the mid-teens, which is significantly less than the 27% increase for the second quarter.

How steep the grade of this recent reversal may be, I can not say, but I trust that diligent Fools will keep their eyes on the data.