-522.56 (-3.26%) ** More… What If The Imploding Baltic Dry Index Does Reflect Global Trade After All
13 Replies to “It’s Probably Nothing”
It might be a good idea to take a couple thousand out of the bank and stuff it under the mattress, just in case its not probably nothing.
I’d never really looked closely at the plots of the Baltic Dry Index against time. That’s a logarithmic scale!!! The motions are huge!!
take it out of he bank, BUY GOLD, and stuff it under the mattress.
We may need to do that out here in Alberta. The NDP’s finance minister is pleased about Moody’s downgrading of the province’s credit rating: https://www.youtube.com/watch?v=J6z44vh8y1A
I’m reminded of what George Orwell wrote in “1984”: “Ignorance is strength.”
The ObaMaCONomy is grinding to a halt. Sounds like we need another $ 8 Trillion in “stimulus” ? More “shovel-ready” jobs ? More local government bailout money ?
Did John Galt just left the building?
Repositioning the troops.
Fear not investors.. or just run for the exits ?
Maybe just get out of the game, if they let you.
We’re trying to guesstimate what will be very pricey in due time; what everyday items will start costing much more, so planning to stock up on household essentials. We figure 5 yrs. This financial drop has no ‘stop’ gap this time as Q&E has been a massive waste, save for the very connected who made out like bandits.
From the Zerohedge graph it appears that bulk shipping is still increasing a few percent annually, albeit down from 10% or more a few years ago. Lower oil prices reduce operating costs. And the cost of money to buy/own ships is very low. Do the calculations and Maersk (just for an example) is trading down 50% from their high ten months ago.
This combination of cheap freight, cheap oil and free money should have the world economy roaring. Something is wrong.
Luckily, we have Justin Trudeau at our helm 🙂
@WalterF
“This combination of cheap freight, cheap oil and free money should have the world economy roaring. Something is wrong.”
Reasoning from a price change. Freight is cheap and oil is cheap and money is free precisely because the world economy is not roaring.
The BDI ceased to be a worthwhile indicator at about the same time as the economic collapse because the supply of vessels wasn’t as inelastic as believed. Guys like Mark Perry were heralding a rapid recovery despite all evidence to the contrary.
However, the BDI isn’t always a bad measure of activity. The index reaching this low is definitely a portent of problems. Another commenter said that low oil prices contribute to the decline, which is true, but low demand is a bigger problem.
I believe we are on the verge of another recession, and I only hope it hits within the next few months so Obama can own it.
It might be a good idea to take a couple thousand out of the bank and stuff it under the mattress, just in case its not probably nothing.
I’d never really looked closely at the plots of the Baltic Dry Index against time. That’s a logarithmic scale!!! The motions are huge!!
take it out of he bank, BUY GOLD, and stuff it under the mattress.
We may need to do that out here in Alberta. The NDP’s finance minister is pleased about Moody’s downgrading of the province’s credit rating:
https://www.youtube.com/watch?v=J6z44vh8y1A
I’m reminded of what George Orwell wrote in “1984”: “Ignorance is strength.”
The ObaMaCONomy is grinding to a halt. Sounds like we need another $ 8 Trillion in “stimulus” ? More “shovel-ready” jobs ? More local government bailout money ?
Did John Galt just left the building?
Repositioning the troops.
Fear not investors.. or just run for the exits ?
Maybe just get out of the game, if they let you.
We’re trying to guesstimate what will be very pricey in due time; what everyday items will start costing much more, so planning to stock up on household essentials. We figure 5 yrs. This financial drop has no ‘stop’ gap this time as Q&E has been a massive waste, save for the very connected who made out like bandits.
http://www.forbes.com/sites/timworstall/2016/01/20/to-explain-the-baltic-dry-index-plunge-its-supply-not-demand/#2715e4857a0b79a1961321c0
The guy at Forbes says not to worry,and mentions “having kittens” at Zero hedge.
http://uk.businessinsider.com/baltic-dry-index-falls-to-lowest-level-in-history-2016-1
Another guy,at Business Insider,says we should worry.BDI is down 84% from late 2013 August.
I guess I’ll just have to trust in government and MY Prime Minister to look after me,and us all.
(Sob)
From the Zerohedge graph it appears that bulk shipping is still increasing a few percent annually, albeit down from 10% or more a few years ago. Lower oil prices reduce operating costs. And the cost of money to buy/own ships is very low. Do the calculations and Maersk (just for an example) is trading down 50% from their high ten months ago.
This combination of cheap freight, cheap oil and free money should have the world economy roaring. Something is wrong.
Luckily, we have Justin Trudeau at our helm 🙂
@WalterF
“This combination of cheap freight, cheap oil and free money should have the world economy roaring. Something is wrong.”
Reasoning from a price change. Freight is cheap and oil is cheap and money is free precisely because the world economy is not roaring.
The BDI ceased to be a worthwhile indicator at about the same time as the economic collapse because the supply of vessels wasn’t as inelastic as believed. Guys like Mark Perry were heralding a rapid recovery despite all evidence to the contrary.
However, the BDI isn’t always a bad measure of activity. The index reaching this low is definitely a portent of problems. Another commenter said that low oil prices contribute to the decline, which is true, but low demand is a bigger problem.
I believe we are on the verge of another recession, and I only hope it hits within the next few months so Obama can own it.