World Trade Slumps By Most Since Financial Crisis

Tyler Durden's picture

As goes the world, so goes America (according to 30 years of historical data), and so when world trade volumes drop over 2% (the biggest drop since 2009) in the last six months to the weakest since June 2014, the "US recession imminent" canary in the coalmine is drawing her last breath...



As Wolf Street's Wolf Richter adds, this isn’t stagnation or sluggish growth. This is the steepest and longest decline in world trade since the Financial Crisis. Unless a miracle happened in June, and miracles are becoming exceedingly scarce in this sector, world trade will have experienced its first back-to-back quarterly contraction since 2009.

Both of the measures above track import and export volumes. As volumes have been skidding, new shipping capacity has been bursting on the scene in what has become a brutal fight for market share [read… Container Carriers Wage Price War to Form Global Shipping Oligopoly].

Hence pricing per unit, in US dollars, has plunged 14% since May 2014, and nearly 20% since the peak in March 2011. For the months of March, April, and May, the unit price index has hit levels not seen since mid-2009.


World trade isn’t down for just one month, or just one region. It wasn’t bad weather or an election somewhere or whatever. The swoon has now lasted five months. In addition, the CPB decorated its report with sharp downward revisions of the prior months. And it isn’t limited to just one region. The report explains:

The decline was widespread, import and export volumes decreasing in most regions and countries, both advanced and emerging. Import and export growth turned heavily negative in Japan. Among emerging economies, Central and Eastern Europe was one of the worst performers.

Given these trends, the crummy performance of our heavily internationalized revenue-challenged corporate heroes is starting to make sense: it’s tough out there.

But not just in the rest of the world. At first we thought it might have been a blip, a short-term thing. Read… Americans’ Economic Confidence Gets Whacked

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davidalan1's picture

shocker....does Obama know about this?

Mike in GA's picture

Can someone explain why the BDI is way back up off its lows?

wholy1's picture

1)  data being rigged

2)  China has to something with all the Treasuries being dumped

kliguy38's picture

WHo one believes any of the "stats".......garbage in garbage out

The Darwin Mode's picture

"Who one believes any of the "stats"... --kliguy38

Except many of us in the alt media world love to quote the Baltic Dry Index when it's getting crushed. To see it soaring over the past six weeks is very peculiar, and seems to contradict what's going on with commodities.

New_Meat's picture

Intel folk look for the anomalies,

Manthong's picture

well heck, I am contrary to  just about everything  that normal folks think...

put me on the list  :-)

Keyser's picture

It's a game of whack-a-mole... Whenever the alt media begins to reference historic indicators that drive investor sentiment, TPTB begin to manipulate the statistics... How many ways are they doing this? Well, how about employment numbers, inflation, VIX, national debt, and on and on and on...

Manthong's picture

Whack a mole”…I have not done that for many years.

.. but I have a pretty good memory and sense of proportion.

It seems to me like the little rats were popping up from 76 mm holes.

I know  a firing solution for that.


kchrisc's picture

I quit paying attention to the BDI long ago. The thing always looks like a epilepsy sufferer having a seizure and a heart attack at the same time. The thing doesn't so much "random walk" but perform random gymnastics.

I think that the BDI's problem probably lies in the way its data is collected. I don't see how anyone could use it, or take it seriously.

Liberty is  a demand. Tyranny is submission..

OldPhart's picture

I think you nailed it, there.  I've watched it for a couple years since ZH called my attention to it and I've yet to make any rational sense out of it's numbers.  I don't think it's a seizure and heart attack, I attribute the spikes to orgasms.

Sitting idle for months, any warm breath of movement would, at the least, pop a chubby (too old for an offical hardon), and any money sprinkled in would be viagra and a full release from several months (minus dust).

jcdenton's picture

It's Iran .. Preparing to share their oil ..  They have a lot to share ..  Also they want our (the West) cars ..  Not GM though .. Ford, Toyota, Benz, etc ..

cheech_wizard's picture

I tend to go a step further. Look at the price of bunker fuel over the last month, becuase as we all know, thse cargo container ships don't run on unicorn farts.

Over the last two months, bunker fuel prices have been dropping like a rock. Track that against your Baltic Dry Index.

As noted in the article:

"With lower fuel costs containerships, oil tankers and bulk carriers are speeding up to cut total voyaging costs - sacrificing more fuel consumption for shorter journey times and faster turnarounds.”

This might explain the recent pop in the Baltic Dry Index.

I probably need to chart the two against each other.

erk's picture

If you read how the BDI is calculated, you will see that it should drop with decreasing price of bunker fuel, not rise as some people here are suggesting.


Nexus789's picture

The BDI index will also reflect the structural changes taking place  in the shipping market.

kaiserhoff's picture

Sure Mike.  Glad to help.

Putin is laying in a supply of beer, sacks, cheerleader costumes, and condoms for football season.

Aren't we all?

johngaltfla's picture


Replace the word "imminent" with "ongoing and deepening" and then you have a factual headline.

Billy the Poet's picture

"Imminent" in the sense that things are getting so bad that even the manipulated government economic data can no longer hide the fact that things are headed south.

opt out's picture

imminent = chicken little click bait

lunaticfringe's picture

I think you guys will appreciate this link- Who's blowtorching American jobs? 8 mins, altho it makes it's point in 6.

CheapBastard's picture

It's imminent!


There's a Mad Rush to Buy Earthquake Survival Kits in Seattle

johngaltfla's picture

FI, wake up. Read the JoC. 30% of all shipping capacity is at anchor or being shredded by poor people in India or Indonesia.

When capacity is reduced, price goes up.


New_Meat's picture

price cures price

but there is this pesky time-lag in the interim

OldPhart's picture

BTW, loved your story of the collapse.  Keep clicking back on your site for any updates.  Starting to think about writing my own just for shits and giggles.  Would you mind if your's is referenced or linked if I ever spend more than a couple hours from Zero Hedge?  I have an itch to start writing again for some fucking reason.  I reallo don't want to, but am starting to feel that I have to.  (This shit is driving me nucking futs!  Having an FBI agent on your porch REALLY has a tendancy to shut your mouth, and I was pretty mouthy on facebook and newsvine before finding Zero Hedge.  But my wife loaned me my balls and I'm starting to want to use them again.)


Mike in GA's picture

No, not mine, but thanks for the link.  It is a good article. Very interesting that Chinese corn imports are up so much from prior years. Pretty smart move on their part if accurate, plus it ties in well with Jim Rogers oft-stated commodities thesis that as countries grow wealthier their increased meat intake drives up demand for grain as livestock feed.

AbbeBrel's picture

Not sure if the corn imports from Ukraine by China will have a long term effect on the BDIY. Seems imports from Bulgaria are also up by 23X. Good FT article on this Silk Road pivot by China:

PrimalScream's picture

about the BDI ... you need to look at the long-term chart.  BDI is at generational lows. The relative up's and down's are minor.  Probably more related to ships being pulled OUT of the line-up for duty.  The BDI is toast.

nope-1004's picture

Everything from Wall Street is "since the financial crisis".


Wish some truth would be told at some point, that the "recovery" since 2008 has been a smoke & mirrors recovery with cooked books, fake employment stats, FASB accounting changes marking asset values to fantasy, and back door bailouts of the financial institutions because they are 100% insolvent.

We have not had a recovery since 2008.  In fact, one could argue that the housing bubble that started in 2002 up to 2008 was also a band aid attempt at creating a fictitious recovery by stoking asset values, hyperinflating housing, and further debasing savings at the expense of the productive population.  The FED is sucking the life out of anyone not chasing bubbles, unicorns, and rain bows.

The financial system is a crooked lie and WE ARE IN A PROLONGED DEPRESSION.

Let's call a spade a spade.

Tinky's picture

Under the circumstances, I'd prefer to call the spade a fucking shovel.

Billy the Poet's picture

Your can't say "spade" anymore. You have to say, "the s-word."

New_Meat's picture

"yes Sister, I do understand that men often call a spade a spade, but ..."

Deathstar's picture

So, I guess we have a worthless shovel in the blackhouse.

willwork4food's picture

We have not had a recovery since 2008.

I would argue that we have not had a recover since 1960 during the early Camelot years. Reagan? Loved him, but he just spiked the shit out of the US debt.

Hasn't been the same since Nixon took us all off the gold standard in '71.

jcdenton's picture

Agree that real wages have been declining since '71 ..  The Depression began for me in the summer of '02 ..  No real recovery since .. There were attempts or "gasps" in '04 and '11 ..  The present proves now that we have been in trouble since '00 ..  Thanks to Greenspan .. Only blame Reagan because he was forced to choose Greenspan, with pretty much a gun to his head in the hands of GHWB ..

willwork4food's picture

I don't know how old you are jc, but I was in grade school in 71. The times after were bleak, dark and not fun. I remember talk about the long lines at the gas pumps (didn't drive so it didn't effect me much), but EVERYONE was struggling. Even back then I was aware that we were lucky our dad was a school teacher. After graduation the times in the late 70's under Carter were pretty tough. I was on my own, experienced it, got minimum wage jobs to afford rent, slowly worked up to $5hr as an apprentice in 79. When Reagan took the helm things started to kick ass. I didn't care what he did, how he did it, but it worked miracles in my life at the time. Of course now we all know HOW he did it...and how the others did it..and how it will end.

New_Meat's picture

u b rememberin' long gas lines in '71?


willwork4food's picture

No, I dont remember them and didn't care. I was 13.

jcdenton's picture

I was born in '59. I do remember the lines. My dad is a retired pastor, so back then he was never getting great pay until later in the 80s. Interesting  huh ..   I joined the USMC in '80 .. Reagan was my CinC. The real miracle when we all see it, will be Reagan's secret agent Lee Wanta ..  Standby, it's all about to come online .. (post collapse that is) .. That was Reagan's vision and his real legacy. The history books are about to rewritten ..


* The Wanta Plan was ready to go online in the mid 90s. Instead, they put him in jail, at about the same time they murdered Vince Foster. Had it happened even before '00, we probably would not be talking collapse in this thread. But we are talking the same perps that did JFK and 9/11 ..

Manthong's picture

Hey, NBFD.. but by the time you went into the USMC, I had finished two tours of Naval air two years prior...

OK so that having being said.. we have all been used.

And the kids today with the monster packs sweating their asses off looking like Robo-Cop on Steroids in the desert where we do not want to be.... I just  don’t know what to say.

Thank you for your service.. I am confident it was honorable.

But here is a cool anecdote for you…

Back when they had Navy boot camp in San Diego.. we had some weaklings that felt the need bug out and go over the fence ---    into Pendleton.

Oh boy.. were they in for a surprise .


Oh, and one more thing ...  the reason I got out back then was Carter was the CINC..

but WTF, he was way better the F in C now.


and Oh WTF while I am on a roll..

just about all of the flag officers Obummer has now would not make Jefferson's list for out -house cleaners..


oh..oh.. oh.. stop me before I hurt myself  :-)

Vlad.. when the nukes start flying,  save a nuke and please spare Chicago..

it will destroy itself.

good thing I am just some little schmuck commenter and not a journalist..

otherwise I would be an

"Unprivileged Beligerent".

Bush 43 wiped out the 4th Amendment.

I cannot believe I was so uniformed as to actually vote for the Yale club a-hole.

the Clown in Chief today is wiping out the 1st.

..we are all Soviets now.


Manthong's picture

loosing my breath ......    speachless.. I wrote the other stuff before reading this.

Manthong's picture

GHWB.. can you believe they actually named a carrier after that schmuck?

Better news was that pres peanut got a sub that we don't see much of...

Suggestion.. find a garbage scow to  commemorate Schrub 43.


I'm dying here.. a banana boat for you know who..  :-D

Ward no. 6's picture

not really a depression

perhaps a recession

i dunno

majority of ppl are not making enuf money

that is a big problem

overmedicatedundersexed's picture

ward 6 says:"majority of ppl are not making enuf money

that is a big problem"

well not exactly...major criminals at the top are draining the ponds of comes down to organized crime at the top here in the west..see j corzine if you don't understand.

OldPhart's picture

Our 'economic recovery'TM is the smallest dead cat bounce in history as we plunge into the 100 year depression created by the combination of world reserve currency, unparalleled world debt, gazillions of printed money, manipulated market prices, a parastitic government of oligarchs and a neo-feudalism of society soon after the absolute annihilation by countries fed up with Whorington, DC control.

Our country is going to die, sooner rather than later, and it's going to be a death by violence.  External and internal.  (Porch monkeys, white and black, will eradicate most of the population in a frenzy of looting.)

There is no other possibility.  We have morons for leaders, morons as electors, and we're gong to get the exact government we deserve, and will pay the price for.

The dumbass in the administration and the other 504 or so so-called leaders (and the couple thousand below them) are going to kill off 95% of us on idiotic policies.  The rest of the world will kill off the remaining 3 to 4%

I suggest you start having your kids learn chinese and russian.  If they live, they might have jobs picking strawberries in California, Mexico or Argentina.

J Jason Djfmam's picture


The body hit the floor, dead.

It has been strung up like a puppet.

The puppetmaster has been moving the body around like it's alive.

The strings are showing signs of imminent breakage.

One string breaks putting that much more load on the other strings.

Only a matter of time.

This time it will be a rotten decayed corpse hitting the floor.