Baltic Dry Plunges By Over 8% Overnight, Most Since 2008

Tyler Durden's picture

It has been a while since we looked at the Baltic Dry Index, which when normalizing for the excess glut in dry container ship supply (such as right now - 5 years after all the excess supply in the industry - has long been normalized), continues to be one of the best concurrent indicators of global shipping and trade. We look at it today, moments ago it just posted an epic 8.2% plunge, crashing from 900 to 826, or the biggest drop since 2008! Of course, conisdering the collapse in global trade confirmed in past days by both Chinese and US data, this should not come as a surprise, although we are certain it will merely bring out the BDIY apologists who tell us that supply and demand here (like in every other Fed-supported market) are completely uncorrelated.


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VonManstein's picture

SPX JPYUSD spread suggests reversal very soon.

Stocks at record levels pricing in 1000 virigns and Gold and Silver are the only buys here

CPL's picture

Do you accept hand jives as collateral?

JPM Hater001's picture

They accept Funky hand jives only.

CPL's picture

Hand or blowing variety?

TruthInSunshine's picture

Bullish! I heard that The Bernank was going to expand asset purchases to commercial ships!



Global Shipbuilding Outlook – 45% of Shipyards Have No Orders

By Sanjeev Rana, Deutsche Bank 

Global Shipbuilding Downturn Continues

Global shipbuilding industry has been going through a downturn for the last four years. The downturn has been felt more in the commercial shipbuilding industry where demand tends to be driven by fixed asset investments and growth in global trade. Global commercial ship orders were down 48% YoY in the first nine months of 2012 and order backlog fell to half of the level in first half of 2008. At this point all lead sector indicators such as freight rates, ship prices, used ship transactions, and used ship prices suggest that commercial shipbuilding demand is unlikely to recover much in 2013 as the sector continues to suffer from oversupply, a weak financing market, and low freight rates...


Despite very low ship prices, shipowners expect prices to fall further due to competition among yards as 45% of global shipyards have no orders to work on post-2012.

GetZeeGold's picture



Just get the metal, dealing with just one virgin is a headache.....let alone a 1000 of them.

Stoploss's picture

First it's 72, now 1000?

WTF??  Will they leave any for the rest of us?

fonzannoon's picture

Fiscal Cliff Superstorm Sandy Republicans!

Quinvarius's picture

Hard to compete with Amazon's free super saver shipping.  Amazon can't even do it.

caShOnlY's picture

it appears the BLS has made a "seasonal revision" to the BDI.  It is now only down 4%.  It would seem they are telling us that a "recovery" has just been discovered.

tango's picture

BLS drops, markets rise - SOS

firstdivision's picture

Holiday sales will be spectacular.....

Shevva's picture

Already covered sales will be up 10% on last year, moneys free and easy. 

Lol your a tax payer at xmas, be lucky.

Vashta Nerada's picture

True, but both of them near me always seem to have long lines at the firearm checkout - much longer these days.

Miramanee's picture

I suspect there are years, perhaps decades, of "juice" left in the Central Bank arsenals to keep the world afloat economically. I don't see much long term import in such measures as the BDI. HOWEVER...the actions of Central Banks is creating both a perception and thus a reality of just how sick the world is. The citizens of the world have yet to see this thing as terminal. When they do....yikes.

mayhem_korner's picture



The "juice" isn't actually in the CB's in the brainwashed minds of the sheeple who continue to have blind faith in the CB arsenals.

kridkrid's picture

Very true. Which is why, at some point in the not too distant future, truth telling will be an act of terrorism. This place gets shut dwn.

Cdad's picture

Nuts!  Well, there goes my dream of becoming the captain of a container ship.  Is there any dream anywhere that Ben Bernanke HASN'T destroyed?

I'll have to go with plan B, and attempt to accumulate a controling interest in rusting hulks...later on today.

fonzannoon's picture

Tungsten for Tankers?

Dead Canary's picture

Do mega freighters make good pirate ships?

Ahoy me hearties.

Shevva's picture

Water world, the film that jumped the US's entertainment industry along with a shark.

GMadScientist's picture

I said, "Ahoy, me..."..."is this thing moving?"

crusty curmudgeon's picture


There's soon to be a new law of supply and demand:


- Demand flat:  Price up / Supply flat:  Price up

- Demand up:  Price up / Supply up:  Price up

- Demand down:  Price up / Supply down:  Price up

Caviar Emptor's picture

OMG ghosts of 2008! And on 12/12/12/! I gotta rehearse my Mayan incantations

JPM Hater001's picture

Use a banker to practice the sacrifice and save the virgin for the real day.

We have so few people who haven't been screwed they are rare.

insanelysane's picture

Walmart guy on tv today hinting that fiscal cliff has already done its damage to the Christmas shopping season.  Black Friday buying may have been through the roof but the look and tone of this guy tells me that when the final tally comes in, the market is going higher on QE ocho-infinity, cause the layoffs in January are going to be through the roof.

HelluvaEngineer's picture

If the damage is done then the situation can only improve. Bullish!

Seriously though, I was at a Wal-Mart and Target in a nice part of town last weekend and there weren't many people there and not much buying going on. Usually we wait for 45 mins in the checkout line at Wal-Mart.  Only a quarter of the lanes were open and they were 3 people deep.

Stonedog's picture

Let's see if it makes its 647 all time low in the near future... 

PaperBear's picture

It surged from under 1,000 back in the year 2002 to over 10,000 in 2007 and in 2012 it has gone back below 1,000 - what an EPIC BUBBLE.

kridkrid's picture

A bubble indeed. And the chart looks exactly like someone rolled a ball out of an open window from the 80th floor. After a couple of bounces, it starts rolling towards the gutter. And while this is a bit cliche, when products stop crossing borders, boots start.

centerline's picture

Another reasonable indicator of how large a credit bubble was blown... and how big a hole that has been created requiring deleveraging (or funny money filling).

buzzsaw99's picture

if bank bonuses were dependent upon the bdi it would be at record highs right now

Tsar Pointless's picture

And on right now...

Stocks Set for Higher Open as QE4 Awaited

Isn't that all we really need to know?

Caviar Emptor's picture

Holiday bonuses need to be juiced on WS

Stonedog's picture

QE4 will have the impact of a water pistol - QE (infinity) was the Fed's last bullet.  This is a bluff and if they pull the trigger everybody is going to know that the emperor has no clothes...

IPA's picture

Option 5 is all that's left?

I am curious to know what other measures they could take, aside from increaing the levels of previous QE'x