Author Topic: Collapse of global shipping - world economy in free fall?  (Read 6000 times)

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Offline Matthew

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Collapse of global shipping - world economy in free fall?
« on: January 19, 2016, 03:41:48 PM »
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  • Well, the only thing I can verify is that the Baltic Dry Index is down to a record low of 380 or somewhere around there.
    Usually it's in the thousands.

    This last couple weeks it's really been crashing. Maybe this is why?

    The government can't manipulate that number, either. It's a direct calculation of raw materials being shipped around the world. If no shipping is happening, it means factories aren't ordering raw materials. And why not? It can only be because people aren't buying stuff.

    Car lots are being stacked up with new cars to the moon. Eventually the car makers are going to run out of space and stop making them -- that means closing lots of factories and tons more layoffs. They're already giving car loans to anyone with a pulse (not a job, just a pulse!) A huge number of car loans are for 7 years and more. It used to be that car loans were 3 or 4 years. Now they're pushing 8 years!

    As a not-so-rich person who survives partly because he doesn't have a car payment, I'm here to tell you that's bad news. So even if they get lucky and get a reliable car they can keep for 8 years, they will never be without a payment (no chance to catch up or do "something else" with that Car Payment money, even for a couple of years!) 8 year car loans is a recipe for being "under water", or owing more than your car is worth, real fast.

    * The unemployment rate can be manipulated, and it is. They just don't count any unemployed people. Right now close to 100 million Americans are "not in the workforce". That number hasn't been seen since the 1970's.
    * The stock market can be manipulated. The Fed (which creates money out of thin air) can just buy a bunch of shares and BOOM the prices go up again.


    Unfortunately, most Americans only look at those two things in order to determine "how is the economy doing".
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    Offline Matthew

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    Collapse of global shipping - world economy in free fall?
    « Reply #1 on: January 19, 2016, 03:44:29 PM »
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  • The part of this report I *don't* understand or believe is why they'd refuse payment in US Dollars -- currently one of the strongest currencies out there.

    (I didn't say it should be, or that its fundamentals are strong -- only that, for whatever reason, they've managed to make the dollar very strong)

    That's why aluminum cans are 25 cents a pound, silver is less than $14 an ounce, and gold is $1093 an ounce. Oh, and oil is $29 a barrel.

    I think it's bizarro world, but the US dollar is insanely strong right now.
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    Offline Neil Obstat

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    Collapse of global shipping - world economy in free fall?
    « Reply #2 on: January 26, 2016, 01:46:18 AM »
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  • Quote from: Matthew

    Well, the only thing I can verify is that the Baltic Dry Index is down to a record low of 380 or somewhere around there.
    Usually it's in the thousands.

    This last couple weeks it's really been crashing. Maybe this is why?

    The government can't manipulate that number, either. It's a direct calculation of raw materials being shipped around the world. If no shipping is happening, it means factories aren't ordering raw materials. And why not? It can only be because people aren't buying stuff.


    For the past 5 days, the Baltic Dry Index has been at 354, down from 380 on 1-14.

    On 1-19, the day of Matthew's post above, it was at 369.

    I wish I could copy the graph but here is the source page:

    http://www.bloomberg.com/quote/BDIY:IND

    It looks like the graph has hit rock bottom or whatever.  If you choose the 5-year option, you can see this BDI is the lowest it's been since 2011.  

    Every year (for the past 5 years anyway) BDI has dropped to a local low at the end of January, and then within a month or two it has begun to rise again, but also, every year (for the past 5 years, anyway) BDI has been lower and lower.  

    Here is a quick list (BDI @ end of January):
    2011  1,137
    2012     647
    2013     750
    2014  1,091
    2015     513
    2016    (354?)  - We have to wait a few more days to be sure!

    .
    .--. .-.-.- ... .-.-.- ..-. --- .-. - .... . -.- .. -. --. -.. --- -- --..-- - .... . .--. --- .-- . .-. .- -. -.. -....- -....- .--- ..- ... - -.- .. -.. -.. .. -. --. .-.-.

    Offline Neil Obstat

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    Collapse of global shipping - world economy in free fall?
    « Reply #3 on: January 26, 2016, 01:59:25 AM »
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  • From the site I linked above:

    Quote

     Profile
    The Baltic Dry Index (replaces the Baltic Freight Index): A composite of the Baltic Capesize, Panamax, Handysize and Supramax indices. The index is designed as the successor to the Baltic Freight Index and was first published on January 4, 1985 at 1000 points. Last day of trading yr - Christmas Eve

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    Offline Stubborn

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    Collapse of global shipping - world economy in free fall?
    « Reply #4 on: January 26, 2016, 06:22:20 AM »
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  • The BDI is a good indicator of the global economy for the simple reason that everything, literally, is shipped. When people have money, demand is good, economy is good, shipping is up.

    It hit an all time high in 2008 when it got up to 11793, the latest chart I can find is showing that as of yesterday, it hit another all time low at 358.

    Here is a link for a monthly chart of BDI, someone has his analysis all over the chart showing low of 354 for yesterday.


     



     
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    Offline RomanCatholic1953

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    Collapse of global shipping - world economy in free fall?
    « Reply #5 on: January 29, 2016, 03:15:46 PM »
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  • Here is one of the websites of the Baltic Dry Index:

    http://www.dryships.com/pages/report.php

    Offline Neil Obstat

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    Collapse of global shipping - world economy in free fall?
    « Reply #6 on: January 31, 2016, 10:11:07 PM »
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  • .

    Quote from: RomanCatholic1953
    Here is one of the websites of the Baltic Dry Index:

    http://www.dryships.com/pages/report.php

    The Bloomberg site has more composite information (You can look at one function instead of three or more as you have do to on dryships):

    http://www.bloomberg.com/quote/BDIY:IND

    Select the 5-year display option and see a clear picture.

    Quote from: Neil Obstat
    Quote from: Matthew

    Well, the only thing I can verify is that the Baltic Dry Index is down to a record low of 380 or somewhere around there.
    Usually it's in the thousands.

    This last couple weeks it's really been crashing. Maybe this is why?

    The government can't manipulate that number, either. It's a direct calculation of raw materials being shipped around the world. If no shipping is happening, it means factories aren't ordering raw materials. And why not? It can only be because people aren't buying stuff.


    For the past 5 days, the Baltic Dry Index has been at 354, down from 380 on 1-14.

    On 1-19, the day of Matthew's post above, it was at 369.

    I wish I could copy the graph but here is the source page:

    http://www.bloomberg.com/quote/BDIY:IND

    It looks like the graph has hit rock bottom or whatever.  If you choose the 5-year option, you can see this BDI is the lowest it's been since 2011.  

    Every year (for the past 5 years anyway) BDI has dropped to a local low at the end of January, and then within a month or two it has begun to rise again, but also, every year (for the past 5 years, anyway) BDI has been lower and lower.  

    Here is a quick list (BDI @ end of January):
    2011  1,137
    2012     647
    2013     750
    2014  1,091
    2015     513
    2016    (354?)  - We have to wait a few more days to be sure!



    So --- it's now a few days later, and the Index has fallen further.
    It seemed to be at rock-bottom before, but that was an illusion.

    It has fallen from 354 to 317! (as of 1-29 which was Friday)

    .--. .-.-.- ... .-.-.- ..-. --- .-. - .... . -.- .. -. --. -.. --- -- --..-- - .... . .--. --- .-- . .-. .- -. -.. -....- -....- .--- ..- ... - -.- .. -.. -.. .. -. --. .-.-.

    Offline Neil Obstat

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    Collapse of global shipping - world economy in free fall?
    « Reply #7 on: January 31, 2016, 10:31:59 PM »
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  • To select the 5-year display option, click on "5Y" next to "TIME FRAME".
    .--. .-.-.- ... .-.-.- ..-. --- .-. - .... . -.- .. -. --. -.. --- -- --..-- - .... . .--. --- .-- . .-. .- -. -.. -....- -....- .--- ..- ... - -.- .. -.. -.. .. -. --. .-.-.


    Offline RomanCatholic1953

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    Collapse of global shipping - world economy in free fall?
    « Reply #8 on: February 04, 2016, 12:02:04 PM »
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  • According to the above link to the BDI it is now -5  298 as of today 2/4/16.

    Offline RomanCatholic1953

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    Collapse of global shipping - world economy in free fall?
    « Reply #9 on: February 04, 2016, 12:15:10 PM »
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  • Here is something that I found on the internet about the projections how
    strong the world  economy by each nation will be in 2025, 9 years from now.
    All I can see about every nation including the U.S. will be poorer when
    we arrive in 2025.

    Deagel.com


    http://www.deagel.com/country/forecast.aspx

    Offline RomanCatholic1953

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    Collapse of global shipping - world economy in free fall?
    « Reply #10 on: February 08, 2016, 06:57:37 PM »
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  • BDI -4 (293) for 2/8/16.  I heard that BDI has not been this low since the Great Depression of the1930's.


    Offline Mark 79

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    Collapse of global shipping - world economy in free fall?
    « Reply #11 on: February 09, 2016, 12:23:22 AM »
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  • Indeed, compare that to the 11,793 high of the index.

    Offline TheRealMcCoy

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    Collapse of global shipping - world economy in free fall?
    « Reply #12 on: February 09, 2016, 10:55:16 AM »
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  • Quote from: Matthew
    The part of this report I *don't* understand or believe is why they'd refuse payment in US Dollars -- currently one of the strongest currencies out there.

    (I didn't say it should be, or that its fundamentals are strong -- only that, for whatever reason, they've managed to make the dollar very strong)

    That's why aluminum cans are 25 cents a pound, silver is less than $14 an ounce, and gold is $1093 an ounce. Oh, and oil is $29 a barrel.

    I think it's bizarro world, but the US dollar is insanely strong right now.


    For many years I bought the "dollar devaluation" hook, line, and sinker and began buying precious metals.  I encouraged family to do the same.  But when Warren Buffet and George Soros began buying US dollars I rethought my strategy.  The only conclusion I've been able to draw from this is they are attempting to constrict the physical cash circulation which would cause a much worse economic crash than the stock market.  If you recall during the Great Depression we had a constriction of cash--nobody had any.  Credit was somewhat easier to come by but nobody had a dime to buy anything.  Prices were cheap but they had no cash.  That's why some farmers and the poor didn't really lose much (there are exceptions of course).

    Can a gold chain buy a loaf of bread?  I know such a thing goes on in Argentina but can we really expect that scenario to exist outside of urban areas?  I'm not sure anymore.  I now believe the best security for the economic tsunami coming our way is to own a home, reduce debt, and have a secure source of income.  I do think there are some industries that can survive like alcohol production, healthcare, and cyber security.  Oh, and government.


    Offline Neil Obstat

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    Collapse of global shipping - world economy in free fall?
    « Reply #13 on: February 09, 2016, 11:06:22 AM »
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  • Quote from: RomanCatholic1953
    BDI -4 (293) for 2/8/16.  I heard that BDI has not been this low since the Great Depression of the1930's.

    At the time of the Great Depression, nobody was using BDI because it did not exist as an index until about 30 years ago.  BDI is a composite indicator which is calculated using several other previously existing indices -- it is a statistical calculation.  

    Now, if those other various indices could be at least estimated for the time of 1930, then an estimate of the BDI for that year could be generated, but it would be in retrospect by 86 years and as such, perhaps subject to some degree of opinion.

    The Bloomberg site I linked above only allows you to view the BDI for the past 5 years.  It does not show what BDI was 6 years ago or 16 years or 66 years ago.
    .--. .-.-.- ... .-.-.- ..-. --- .-. - .... . -.- .. -. --. -.. --- -- --..-- - .... . .--. --- .-- . .-. .- -. -.. -....- -....- .--- ..- ... - -.- .. -.. -.. .. -. --. .-.-.

    Offline RomanCatholic1953

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    Collapse of global shipping - world economy in free fall?
    « Reply #14 on: February 10, 2016, 11:14:45 AM »
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  • According to the latest interview on the X22 report. The BDI is down 62%
    from last month. This has never happened before.
    According to a friend that lives in Long Beach, Ca. He took a boat trip
    outside the breakwater and saw many anchored cargo ships and they
    do not look like they are lined up for bunker fuel.

     

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