Baltic Dry Index at record lows

CaptHenway

Good indication of bad times ahead.



http://www.telegraph.co.uk/fin...-in-living-memory.html

VanHalen

The size of modern cargo ships is astounding with the largest now handling up to 26,000,000 cu.ft. in one load. The equivalent of a cube 100 yards on each side.



Guess they got too big too fast?

Barndog

the news people tell me that the government says all is well.

derryb

Originally posted by: Barndog
the news people tell me that the government says all is well.

At least one of them is a member here.

OPA

How many of these large Capesize vessel does the US own, and how many are under US registry? Very few, if any, I believe. If so, what impact would that have on our economy? Obviously no impact on PM's.

JohnnyCache

My 2016 stock pick is DRYS.

Drys provides ocean transportation services for drybulk and petroleum cargoes, and offshore deepwater drilling services.

Headquarters is in Athens, Greece

If this doesn't give Wingsrule a run for his money (err silver eagle) nothing will.

It's all but sure to go bust.

renman95

Originally posted by: Barndog
the news people tell me that the government says all is well.

And that it's not 2008.

cohodk

Classic example of overbuilding.

derryb

classic example of easy credit facilitating overbuilding. Another fine example of easy money leading to malinvestment.

cohodk

Originally posted by: derryb
classic example of easy credit facilitating overbuilding. Another fine example of easy money leading to malinvestment.

Been like that for 2000 years. So what? I know facts get lost in this forum, but just in case someone out there wants to make their brain cells wiggle, in 2000 there were about 450 capesize ships, in 2008 about 800 and today about 1500. The average size of these ships has also increased by about 35%. Those who cite the BDI as a measure of economic activity are ignorant fools.

derryb

Originally posted by: cohodk
Those who cite the BDI as a measure of economic activity are ignorant fools.

Like Money Velocity is not a measure of economic activity?

cohodk

Originally posted by: derryb

Originally posted by: cohodk
Those who cite the BDI as a measure of economic activity are ignorant fools.

Like Money Velocity is not a measure of economic activity?

Actually that is not a relative comparison, but I do not fault you for trying.

derryb

Originally posted by: cohodk

Originally posted by: derryb

Originally posted by: cohodk
Those who cite the BDI as a measure of economic activity are ignorant fools.

Like Money Velocity is not a measure of economic activity?

Actually that is not a relative comparison, but I do not fault you for trying.

Other than FED press releases, just what does cohodk find to be a good measure of economic activity?

Baley

"economic activity" is like "weather" and "fashion" "industry" or "politics"... one big vague term for a lot of little independent, slightly related, and highly related systems



So there was a big boom in shipping, demand went up, prices went up, supply went up, and then demand went down, and there's now a bust? Wow, what a novel concept!



That's never happened in precious metals, tech stocks, housing, biotech stocks, railroads, telecommunications companies, or any other sector, has it?

derryb

Originally posted by: Baley
"economic activity" is like "weather" and "fashion" or "politics"... one big vague term for a lot of little independent, slightly related, and highly related systems

So there was a big boom in shipping, demand went up, prices went up, supply went up, and then demand went down, and there's now a bust? Wow, what a novel concept!

That's never happened in precious metals, tech stocks, housing, biotech stocks, railroads, telecommunications companies, or any other sector, has it?

Sounds like you also see a shipping demand chart as an indicator of economic activity. Makes you one of cohok's "ignorant fools" along with the rest of us. Welcome to the club.

Baley

Not much into name calling and labels. I read the article and understand it, and it makes perfect sense to me why there is a current glut in cargo shipping capacity and reduced demand.



It's the same with oil. Prices were up, the industry overbuilt and got more efficient, prices are now down. The overleveraged, overindebted, the poor businesspeople, and the inefficient and unlucky will go out of business.



Prices and the supply/demand characteristics of the sector will eventually find a new dynamic equilibrium. "Bad times ahead" for this industry? Sure. For everyone? absolutely not!



It's an ill wind indeed that blow no good somewhere. I'm sure if I was someone who shipped a lot of huge cargo long distances, or used a lot of petroleum products, I'd be pretty happy

cohodk

Originally posted by: derryb

Originally posted by: Baley
"economic activity" is like "weather" and "fashion" or "politics"... one big vague term for a lot of little independent, slightly related, and highly related systems

So there was a big boom in shipping, demand went up, prices went up, supply went up, and then demand went down, and there's now a bust? Wow, what a novel concept!

That's never happened in precious metals, tech stocks, housing, biotech stocks, railroads, telecommunications companies, or any other sector, has it?

Sounds like you also see a shipping demand chart as an indicator of economic activity. Makes you one of cohok's "ignorant fools" along with the rest of us. Welcome to the club.

It's not a shipping demand chart. It's a prices paid chart. If you oversaturate supply prices paid will collapse with does not represent demand. I know this is a field of study that you have already demonstrated vast incomprehension, but at least you could try.

cohodk

You guys are free to create any club you wish. That's not my responsibility or charge.

derryb

A price chart reflects changes in supply and demand. You are a fool to believe that shipping prices have crashed simply because of an over supply of ships or available space on ships. Less international shipping is a good indicator of global economic activity. Reduced imports and exports tell us a bunch.

cohodk

Originally posted by: derryb
A price chart reflects changes in supply and demand. You are a fool to believe that shipping prices have crashed simply because of an over supply of ships or available space on ships. Less international shipping is a good indicator of global economic activity. Reduced imports and exports tell us a bunch.

You need to learn the concept of relativity. Just because a price is lower does not mean the supply and demand equation is compromised. Has demand for computers increased or decreased? What has price done?





How about silver? You say demand has increased yet price is way down, what happened?

cohodk

In order to understand how this works you must first accept the fact that a price discovered today may not be the same price discovered tomorrow even if all factors remain constant. If you do not accept this as fact then you will always have difficulty in this matter.

derryb

Originally posted by: cohodk

Originally posted by: derryb
A price chart reflects changes in supply and demand. You are a fool to believe that shipping prices have crashed simply because of an over supply of ships or available space on ships. Less international shipping is a good indicator of global economic activity. Reduced imports and exports tell us a bunch.

You need to learn the concept of relativity. Just because a price is lower does not mean the supply and demand equation is compromised. Has demand for computers increased or decreased? What has price done?





How about silver? You say demand has increased yet price is way down, what happened?

computer supply has increased and price has reacted accordingly.





Demand for physical silver has increased, reflected in increased premiums. Demand for paper physical has decreased (primarily through shorting), reflected in lower futures prices.





you need to abandon your theory of relativity when it comes to markets and get back to the basics of supply and demand.



This is the "facts" when it comes to price, supply and demand:

derryb

Those who cite the BDI as a measure of economic activity are ignorant fools.

Welcome the newest club member, Deutsche Bank

cohodk

You shall receive no further attempts at understanding economics, market forces, or intermarket relationships from me. You are free to continue to be confused and dismayed at what you think you see. You are free to be taken advantage of by those who quite simply know more than you. You are free to blame "them" when events dont go your way. You are free to propagate misinformation without fear of rebuttal. You have all the power now derryb, use it wisely.

roadrunner

You need to learn the concept of relativity. Just because a price is lower does not mean the supply and demand equation is compromised. Has demand for computers increased or decreased? What has price done?



How about silver? You say demand has increased yet price is way down, what happened?

Relatively speaking, what happened was JPMorgan and $4 TRILL worth of otc commodity derivatives in 2015. That's what happened. I keep saying it, and you keep ignoring it. It's a rigged game well beyond supply vs. demand and typical consumer market forces. Paper supply and demand is FAR different than the physical commodity supply and demand. Paper markets have distorted reality for years in most every aspect of financial markets. If there was a semblance of fair markets and supply vs. demand, it left at the start of QE3. It's be a con's game ever since. And there's going to be heck to pay for having done that. Commodities and AUD, CAD, EUR, were only the first. Others are going to follow.

PerryHall

Am I the only one here who's never heard of the Baltic Dry Index? Very interesting and educational thread.

cohodk

Good indication of bad times ahead.

http://www.telegraph.co.uk/fin...-in-living-memory.html

Apparently it isnt. The index is up 5 fold since the OP. More wheat and chaff in this thread,

OPA

Thanks for regurgitating this 2 year old thread. As always, the same posters who predicted doom & gloom, are once again, WRONG.

ricko

People love to make predictions.... When they are right, they sing and dance and prance around as if they won the lotto... When wrong, they fade into the background wearing camouflage... Cheers, RickO

VanHalen

@OPA said:
Thanks for regurgitating this 2 year old thread. As always, the same posters who predicted doom & gloom, are once again, WRONG.

Amazing what throwing $100,000,000,000 a month ** in the economy will do?! And that's the US alone. Worldwide debt grows by over $500,000,000,000 **a month.

If nearly $10 trillion in debt/year continue to be tossed onto a fire that's already over 300% of current worldwide GDP God only knows how many billionaires we can create.

Kkathyl

I used to deal with sausage casing yes you read that correct. Yuk. We would have ships with over 1.3M on each and most of the ship names are from china. Cheaper to take product from US to China and back then pay labor here. Grill em up.

Can the switch from Dry box to Ref just be delayed because of the temps? Dry box season could just be delayed

jmski52

_Amazing what throwing $100,000,000,000 a month ** in the economy will do?! And that's the US alone. Worldwide debt grows by over $500,000,000,000 **a month.

If nearly $10 trillion in debt/year continue to be tossed onto a fire that's already over 300% of current worldwide GDP God only knows how many billionaires we can create._

I continually have to remind myself that the dollar is a debt instrument, and yet most people consider it to be "money". It used to be money. But now, it's no different than a T-Bill or a mortgage loan document, except that it's used in everyday transactions and available in smaller increments. Still, it's only a debt instrument that doesn't pay interest (big deal, not much interest gets paid these days anyway).

Bank deposits are now legally considered to be bank property that you've loaned to the bank, subject to whatever the bank chooses to do with it. How's that for a perverse twist of reality?

So, you deposit all of these little loan documents into the bank, and this allows the bank to issue loans @ a 10:1 ratio to other bank customers who are taking out a loan in order to gather up a bunch of these same little loan documents for their own purposes, whatever - and paying the bank interest to boot.

Damn, what a racket.

derryb

DBI is an indicator of current conditions, not the future. Look for trade wars, tariffs and other economic warfare to have a negative effect.