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Baltic Dry Massacre Enters 34th Straight Dry As BDIY Plunges 4.5% Overnight
The record slaughter of shippers continues as the BDIY posts the largest overnight drop of 4.5% in the most recent 34-consecutive day trounce in dry bulk shipping rates. Short term Capsize and Panamax charters for Pacific delivery have hit $29k and $19k, respectively, both approximately 30% lower than comparable Atlantic delivery rates as the Chinese transit corridor is now massively oversupplied. At this point it is not a question of if but when the bulk of shipping companies, especially levered ones, start going bankrupt and flood the seas with yet more anchored rusting dry bulk hulls.
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Great, more reason for dow to hit 11000 today
That's funny. At least it is to me. I needed a good laugh today too. Thanks.
I was laughing and crying at the same time...kinda creepy.
Paging James Altucher ....
+100
In order to buy a house, he had put himself at the hands of loan-sharks. The weight of compound interest is too much... He said he is desperate, and want to sell a kidney to repay debts owed.
"line was to sell their kidneys, but also left their contact details." Yesterday afternoon, members of the public Xia told the newspaper, he was browsing a forum to see the local Hefei to a sale of kidneys of information.'s survey, this users buy a house by a loan shark, now unable to pay, and would like to sell their kidneys for repayment.
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Source:
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China Shark Loan Ponzi Finance- Local Chinese Sell Their Kidneys to Repay Shark Loans
ashkenazi iq>chinese iq
Damn that shipping capacity debacle!
still question whether BDIY is a good proxy for SPX...
Well it hasn't been for the past 6 trading sessions, but the previous 6 (down) were + correlated. Then again go back 6+ more and nothing holds.
Think of this as a LEAP indicator :)
http://www.bloomberg.com/apps/quote?ticker=BDIY&exch=IND&x=15&y=11
right and if you compare spx there does not seem to much of a correlation over any time period?
Pull the charts independently and observe the correlated decline. Or If you wish so price BDI in terms of SPX value. The value of $BDI was always bigger than of $SPX [theoretical $ points] and when compared the decline in SPX does not really "show" itself to be correlated, but when you price $BDI in $SPX its much more "obvious".
cheers
When shipping supply (i.e. ships) was relatively constrained it was better - i.e. it was more demand driven. Now with empty supply floating and orders from a few years ago coming on line it obscures things a bit as the supply is moving too. One thing is for certain - demand is not outstripping supply to where they need to pull additional vessels from drydock. At a minimum that would produce sustainable flat pricing as demand steadily racheted up and supply was brought back online at a steady pace to keep price constant.
Basically, this kicks a sustained V shape recovery theory in the nutz.
So I said to the somali pirate 'Take my capesize, please!'
Thank you, I will be here all week.
Try the roast beast. It's to die for.
DRYS has already diluted the hell out of its shareholders, and they will be a penny stock soon as they have no other recourse but to issue shares to stay alive. I see them bankrupt within a year tops.
between mid 2008 and mid 2009 their shares outstanding went from something like 45MM to 220 MM - Merrill was doing another offering every other month
The CEO vowed to not take any more money out of the firm and to stop deluting the stock.
Drys is also way underpriced and one of the fasted growing drybulkers. And the IPO for the drilling rigs should be out arround september so it's very well possible it will pop to 11$
They have been promising DRYS shareholders the drilling rig IPO for over 3 yrs now and still have never once attempted to come through. The man running that company has no intention of giving away this IPO to shareholders as a gift. DRYS is in no way under-priced either. It will see penny land before it sees $5 again. It is THE FASTEST declining shipper. Quit pumping every long position you have, it only shows your desperation.
desperation? :)
I'm doing pretty well actually. My guess is that your getting your ass creamed with your shorts :)
And your junks on my posts confirm it
Who needs UFC?
My money is on thrashing creature with the big teeth (SuddenDebt) -- there is no way that Jr. Big Boy (JKRuff) is gonna take him...
Huh? CREITs like SPG have been paying dividends in stock.
What you describe for DRYS is the proven recipe in this market for the stock to go to 10000
It'll be interesting to see which loan covenants start defaulting first - my bet as always is DRYS - Georgie's ex-wives ain't gonna like THAT!
the biggest convenant is in 2012 to be paid. That's still a sea of time
Tyler, you've got to look at the bright side of things; Thierry Henry just signed with the NYC Red Bulls!
Are you serious?
Thierry Henry is REALLY at end of career!
Its a move up from playing for France
What is the difference between the BP oil spill and France's 2010 national football team?
One is a horrendous out-of-control disaster.
The other is an oil spill.
Next one to make the move states-side: Ronaldinho. Mark. My. Words. The MLS in 2010 is like the North American Soccer League in the 70s, minus the fros, drugs, and disco...
Pelé earned a lot of money at Cosmos... Now he's a rich businessman.
Talking about the NASL, simply the Best (the video may be a bit loud) - http://www.youtube.com/watch?v=U2HWUbFGHMU
Woow!!!
A Dutch defender would have kicked George's head and made the foul on the first dribble..
No,the correct answer is the oil spill is not gay.
LMAO
This good. Because once we get Cap and Trade the only viable ocean-going carriers will be sailing ships. Better squeeze the volume down quickly to a level which that technology can support.
Double post - sorry
What then will be the trigger event, the first fracture to make equity markets implode from all this mounting downside pressure?
The economy is imploding and stocks stay up. What makes you think this will change? It's much easier to levitate the market than the economy.
@Headbanger
Excellent question. Ask myself that everyday. Maybe the reason it sounds so random is that all the talk of TPTB are real and it's just when TPTB want it to be. I used to laugh at that, now it seems extremely rational.
Serious question. Is anyone else feeling a bit desensitized by ongoing anticipation?
Is it just me? Can I exhale?
Singapore GDP growth: First Quarter:45.9%, Second Quarter 26%.
Mortgage Rates : Under 2%. Property Prices: If ya have to ask....
Wow. Chinese selling body parts to speculate in property. West selling soul to speculate in tech stocks. Governments around the world spending most of their waking hours trying to come up with newer , more creative ways to pretend their banks are solvent. Wow.
Everyone needs a good dose of sobering up. Lots of coffee - and need to pass high school physics and calculus before you can sell body parts to speculate - would be my suggestion. Nothing will dry you out faster than having to actually study physics - or a good , complete , purging of the financial system- yeah that would also work.
"Nothing will dry you out faster than having (only one kidney)."
Benron: "Phuck physics, I'm studying Dadaism."
Nothing a good lobbyist can't fix.
More evidence green shoots are taking hold worldwide.
so. the markets should rally another 200 today?
Relax, smart money is loading up on shipping stocks! :)
And chinese solar stocks, too...
Hey Ari. Your island for sale also?
If only buying the stock could make the rates go up.
Clearly we have a different definition of "smart money".
Ari's best trade was buying Jackie O.
ex div
Can their hulls hold oil?
I'm short, so the market will be up today. Tomorrow the Baltic Dry Index will hit 0.
I live in Hong Kong and can see as many boats anchored off the south side of the island as there were in late 2008/early 2009. Friends in Singapore tell me the floatilla in Malaysian waters is also back to those levels. It goes without saying that the Chinese have "warm stacked" a lot of boats in the past 6 weeks.
Cant leave out the ship builders---many billions will be lost- future builds will/are evaporating quickly.
Imports through the Port of Los Angeles surged 32 percent in June Imports through the Port of Los Angeles surged 32 percent in June to reach the highest monthly level since August of 2008.
Imports last month totaled 371,888 TEUs, by far the highest number of the year. The port's marketing staff reported that peak-season vessel strings are returning to the trans-Pacific and ships are arriving full or close to capacity.
Carriers are also returning empty containers to Asia at a record pace to help relieve a severe shortage of equipment there. Empty containers handled at the port were up almost 53 percent compared to June 2009.
http://www.joc.com/maritime/la-imports-come-back-strong
Is that strange, to back haul empty containers? I mean, are we failing to export enough goods in containers that the empties need to be shipped back? What does that say about our exports? This isn't a strong area for me so help in understanding would be appreciated.
It means the U.S.A. is fucked. Proper fucked.
The BDI's crashing yet demand is high in ASIA for containers?Is that not strange?
Baltic Dry will be below 1400 soon. Not a good sign. Something big is happening.
Too many ships with no cargo. NO PROBLEM. Tie them up in CA and the illegals can have a free place to live. With free food and "anything goes" it will be a grounded version of the Carnival Lines! The new DISNEYLAND. Kumbiah!
Cargo ship being converted into all-terrain vehicle.
http://www.videobash.com/video_show/epic-boat-docking-failure-890
BDI is totally irrelavant. Don't believe me? Take this non-believing varlets:
BDI -"The global bulk fleet may expand 14 percent this year, as shipping lines move ahead with deliveries delayed during the credit crisis and global economic slump, according to Woori Investment & Securities Co. Bulk ships with a capacity of about 93.9 million deadweight tons will probably be delivered between June 1 and the end of the year, according to Clarkson. Fleet capacity stood at 486.8 million tons at the start of this month, the shipbroker said."
So there bwahaha!
Probably that dramatic fall in the BDY between June and September 2008 was irrelevant too...
There's no question that additional supply of ships is a part of the fall of the BDI - if that is your point. But that's a microcosm of the economy - too much supply chasing too little demand. Which equals deflation of prices, and does not allow companies to meet their debt obligations, or at the very least their return expectations. So, you bought a ship in 2008 for delivery in 2010, and borrowed 80% to get it done. Pro-formas were based upon x shipping rates. Now you have 50% or less of X rates, and the ship can't meet debt service payments. What happens? Does the bank take it back and sell it into the market - lowering ship prices? And then create an operator who can actually compete on that new price (while everyone else is still losing money) - further pressuring prices? Or does the bank extend and pretend which ties the money up for no additional loans - and we get a bunch of zombie loans. It can easily turn into a vicious cycle.
Paging Mr. Warren Buffet. Paging Mr. Warren Buffet. Your trainset is ready for you
Tyler, you must not have watched Fast Money last night!
I forget which Ph.D. economist on the show said it. But he said that we should "Throw the BDI out" because the fall is so dramatic that it just doesn't matter anymore. Then he said something about how much volume there still is being shipped.
Please don't ask why I had that show on...it was on as background noise as I was working on my computer but had no choice but to listen to that B.S.
What I thought was particularly interesting about the show last night was how much time they spent on INTC's GLOWING earnings, but barely a passing mention of YUM's stock fall. It seems over the last couple of weeks the MSM has been in full denial mode.
Of course, Jim Cramer has taken the double dip off the table and gave the green light to buy!
Extend and Pretend raised to the 10.
The more dramatic the fall the less relevant the measure is...Simple...Got it?
Here is the propaganda ministry problem in a nutshell.
Port of LA telling everyone they are seeing record numbers in shipping containers going through and people in Hong Kong and Malaysia see an increasing number of ships being "laid-up" or anchored with no cargo to transport.
Can the real slim shady please stand-up?
My handle on this is that the BDI is about rates being negotiated for imminent future shipments whereas ships sitting idly at anchor are the current snapshot.
Unless I missed something - the shipping indices are leading indicators of where things are headed.
Having said that equities have been bullish over the last week, and can - no doubt - remain irrational for longer than I can remain solvent!
One day the BDIY is going to go up 0.01%, and the market is going to rally 10% that same day based on "improving conditions in the global shipping market."
And btw, I'm still long EXM/DRYS
Anyone have data on how much of this drop is due to oversupply versus falling demand?
It is very difficult to dicern those numbers in the case of China. They do not divulge the exact numbers of the stategic stores they have, usages or future demand. It is a state secret. The Chinese government buys most of the raw materials used by it's manufacturers. If say an Australian miner were to get the real numbers they might try to get higher rates. In the case of iron ore, the last group of people who conspired to jack up iron ore rates will be in jail for a very long time.
The stupid media and politicians in the West cannot understand why the Chinese would be mad that they overpaid billions over the years due to bribes by commodity suppliers to Chinese officials who leaked secret information.
The Stock Market is on borrowed time...its April all over again.
One of the fat finger events?
In Bear Mkt we sell the rallies..short this Pig. Thats what it is. oink oink..
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