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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Wed, 12/12/2012 - 09:35 | 3055315 VonManstein
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

Wed, 12/12/2012 - 09:37 | 3055320 CPL
CPL's picture

Do you accept hand jives as collateral?

Wed, 12/12/2012 - 09:52 | 3055380 JPM Hater001
JPM Hater001's picture

They accept Funky hand jives only.

Wed, 12/12/2012 - 10:28 | 3055536 GMadScientist
GMadScientist's picture

You misspelled 'jobs'.

Wed, 12/12/2012 - 10:34 | 3055556 CPL
CPL's picture

Hand or blowing variety?

Wed, 12/12/2012 - 11:30 | 3055841 TruthInSunshine
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.

Wed, 12/12/2012 - 09:38 | 3055324 GetZeeGold
GetZeeGold's picture



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

Wed, 12/12/2012 - 09:48 | 3055363 Stoploss
Stoploss's picture

First it's 72, now 1000?

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

Wed, 12/12/2012 - 09:48 | 3055368 GetZeeGold
GetZeeGold's picture



Inflation dude.

Wed, 12/12/2012 - 10:06 | 3055438 astoriajoe
astoriajoe's picture

I've got to get me one of those new 3-d printers that everyone is making such a fuss over...

Wed, 12/12/2012 - 11:00 | 3055708 MachoMan
MachoMan's picture

Save a lot of time and effort and just go to the bar at last call...  the real thing is better... 

Wed, 12/12/2012 - 09:58 | 3055397 Pool Shark
Wed, 12/12/2012 - 10:03 | 3055424 SmallerGovNow2
SmallerGovNow2's picture


Wed, 12/12/2012 - 10:08 | 3055437 WhiteNight123129
WhiteNight123129's picture

Nay, Hedonics adjustment.

Wed, 12/12/2012 - 11:12 | 3055755 JPM Hater001
JPM Hater001's picture

First it's 72, now 1000?



Wed, 12/12/2012 - 12:10 | 3056001 ZeroAvatar
ZeroAvatar's picture

Dude, they'll get to face 1000 VIRGINIANS!

Wed, 12/12/2012 - 09:38 | 3055319 fonzannoon
fonzannoon's picture

Fiscal Cliff Superstorm Sandy Republicans!

Wed, 12/12/2012 - 09:39 | 3055323 Quinvarius
Quinvarius's picture

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

Wed, 12/12/2012 - 09:38 | 3055325 caShOnlY
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.

Wed, 12/12/2012 - 10:43 | 3055613 tango
tango's picture

BLS drops, markets rise - SOS

Wed, 12/12/2012 - 09:38 | 3055328 firstdivision
firstdivision's picture

Holiday sales will be spectacular.....

Wed, 12/12/2012 - 10:01 | 3055416 Shevva
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.

Wed, 12/12/2012 - 10:05 | 3055431 Vashta Nerada
Vashta Nerada's picture Cabela's

Wed, 12/12/2012 - 10:18 | 3055495 otto skorzeny
otto skorzeny's picture

way overpriced

Wed, 12/12/2012 - 10:23 | 3055513 Vashta Nerada
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.

Wed, 12/12/2012 - 09:38 | 3055329 Miramanee
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.

Wed, 12/12/2012 - 09:51 | 3055378 mayhem_korner
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.

Wed, 12/12/2012 - 10:04 | 3055429 kridkrid
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.

Wed, 12/12/2012 - 09:39 | 3055330 Cdad
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.

Wed, 12/12/2012 - 09:41 | 3055339 fonzannoon
fonzannoon's picture

Tungsten for Tankers?

Wed, 12/12/2012 - 09:57 | 3055400 Dead Canary
Dead Canary's picture

Do mega freighters make good pirate ships?

Ahoy me hearties.

Wed, 12/12/2012 - 10:02 | 3055422 Shevva
Shevva's picture

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

Wed, 12/12/2012 - 10:30 | 3055544 GMadScientist
GMadScientist's picture

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

Wed, 12/12/2012 - 09:45 | 3055331 crusty curmudgeon
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

Wed, 12/12/2012 - 09:41 | 3055337 Caviar Emptor
Caviar Emptor's picture

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

Wed, 12/12/2012 - 10:17 | 3055375 fonzannoon
fonzannoon's picture

Relax Caviar, these guys hammered out everything over dinner.

Hah, I got junked and this acticle became the featured article. Eat me.

Wed, 12/12/2012 - 09:54 | 3055386 JPM Hater001
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.

Wed, 12/12/2012 - 09:40 | 3055338 insanelysane
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.

Wed, 12/12/2012 - 10:03 | 3055418 HelluvaEngineer
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.

Wed, 12/12/2012 - 09:40 | 3055340 Stonedog
Stonedog's picture

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

Wed, 12/12/2012 - 09:41 | 3055341 PaperBear
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.

Wed, 12/12/2012 - 09:57 | 3055399 kridkrid
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.

Wed, 12/12/2012 - 10:00 | 3055408 centerline
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).

Wed, 12/12/2012 - 09:41 | 3055343 buzzsaw99
buzzsaw99's picture

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

Wed, 12/12/2012 - 09:43 | 3055344 Tsar Pointless
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?

Wed, 12/12/2012 - 09:44 | 3055350 Caviar Emptor
Caviar Emptor's picture

Holiday bonuses need to be juiced on WS

Wed, 12/12/2012 - 09:44 | 3055353 Stonedog
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...

Wed, 12/12/2012 - 09:49 | 3055369 IPA
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

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