"It Hasn't Been This Bad Since The Viking Age": Dry Bulk CEO Warns Of Bankruptcy Tsunami, Counterparty Risk

Tyler Durden's picture

In the past three months we have repeatedly shown that, despite the recent modest rebound off the all time lows, the bottom is about to fall out of the dry bulk shipping market in articles such as these:

Overnight, the CEO of Dry bulk shipper Golden Ocean Group, Herman Billung spoke before an industry conference in Oslo, and made it clear that our worst-case expectations may prove to be optimistic.

Photo: Golden Ocean Group

He said that Dry Bulk shippers should expect little respite for another two years, adding that an enormous oversupply of vessels isn’t sustainable: "It's a fair assumption to make that only half of the orderbook in 2016 will be delivered."

He warned that "in the coming months there will be a lot of bankruptcies, counterparty risk will be on everybody's lips."

Useful tip: any time a CEO is warning about counterparty risk, it's probably a good idea to listen.

Just to emphasize his point to the local audience he said that "The market has never been this bad before in modern history. We haven't seen a market this bad since the Viking age. This is not sustainable for anybody and will lead to dramatic changes."

Yes, it's that bad.

And what's worse, is that once Billung is proven to be right and the dry bulk bankruptcy tsunami is unleashed sweeping away hundreds of ships with it, the next question will be just which  (mostly European) banks, have the greatest "secured" loan exposure to the dry bulk industry, a sector where we fully expect recoveries on secured loans to be in the pennies on the dollar.

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Father Thyme's picture
Father Thyme (not verified) Mar 3, 2016 8:13 PM

single pennies on the dollar

As planned.

OrangeJews's picture
OrangeJews (not verified) Father Thyme Mar 3, 2016 8:29 PM

Maybe I'll buy one of those dry tanks and furnish it like a house.  I wonder if it will fit on Lake Mead?

GeorgeWKush's picture

What is so wrong about the Viking age?

The Alarmist's picture

Uh, wasn't the Viking age like the golden age of maritime transport or something???

Totentänzerlied's picture

No.  A single modern dry bulk carrier ship has greater gross tonnage than the entire merchant marine fleet of Europe combined until the late colonial period or even later. Further, each one a greater gross tonnage than the entire high-medieval (let alone Viking era) fleet transported in multiple years.

Fifty or so, fully laden, are transporting more cargo than moved by European maritime trade in the two centuries of the "Viking Age."

DownWithYogaPants's picture

Viking V Rapefugees. 

I think even being a middling salesman I could sell a truckload of tickets to that.

Inzidious's picture

Dam. Actually, that would be awesome!

Antifaschistische's picture

How many Syrian, Egyptian, Libyan obama.refugee's can you fit in a dry bulk container ship?  Seems like a easy solution to a big problem.

Sages wife's picture

Obamagees. Ghost cities in China. Hmmm.

steelhead23's picture

Yeah, Kim is way pissed about these unwanted intrusions on his sovereignty. http://evangelicalfocus.com/lifetech/889/Balloons__in__the__sky__bring__...

BlindMonkey's picture

War...what is it good for?... (about 700 up on the S&P)

redd_green's picture

Uh, I think that's "nucular".    You should go to tha libary.

Diplodicus Rex's picture

Redd_green, it looks like a couple of your followers don't understand political satire. Here's a little help for them:



yogibear's picture

"N. Korea Orders Nuclear Weapons ready for Immediate Use"
Better get your Samsung LCD televisions while their being manufactured.

Old Bag Lady's picture

How perfect, a dry tanker for a dry lake.


Dave Whiteman's picture

Made from dry water.  Dry water is much friendlier to the environmentalists.  When dry water freezes it makes dry ice.

BarkingCat's picture

maybe it will fit but how would you get it there??? 

you would need one hell of a trailer!!!

HRH of Aquitaine's picture
HRH of Aquitaine (not verified) Father Thyme Mar 3, 2016 9:08 PM

Wow. And this guy is a CEO? Yes it probably is a good time to pay attention.


Financialization ROCKS.

Normalcy Bias's picture

WWIII is going to fix this problem.

TradingIsLifeBrah's picture
TradingIsLifeBrah (not verified) Normalcy Bias Mar 3, 2016 9:26 PM

They will need those tankers to ship back the bodies... :(

Tinky's picture

So many dykes, so few fingers...

algol_dog's picture

Rachel Maddow agrees with you -

Miffed Microbiologist's picture

Wow, got some disturbing imagery there!


Croesus's picture

Seems like everywhere we look, it's nothing but disturbing imagery... 


Ace006's picture

Muchos unemployed comedians in this thread.

monad's picture

The one that broke me was the Chinese man who jumped overboard into the oil spill to save his friend who fell in.

Metaphor. Once, oorah. Now, Fuck you Rodham. Pig.

Buckaroo Banzai's picture

Hillary Clinton is the gal for this job, she has fingered more than a few dykes, and gotten pretty good at it I hear. My understanding is, her calendar will be wide open right around November 9th of this year.

stormsailor's picture

fingering dykes?  is that a new fetish?

stormsailor's picture

duh, i get it now, like a whistleblower.

Chuck Walla's picture

Who wants tacos!?!?

All you can eat bar at the 'Y'.


Hulk's picture

As a member of "Bikes on Dykes", I resemble that remark !!!

Abbie Normal's picture

Bikes on Dykes -- the newest term for a speed bump.

Ignorance is bliss's picture

Seems like a multi sector crash is on the horizon. oil, Miners, Banks, municipalities, pensions, retail, and now ships...who knows what other productive assets are ready to go bust as the dominos fall. Wonder what it's all going to look like the day after the SHTF.

Fester's picture


Wealth doesn't disappear, it transfers.

Keep stacking

WonderDawg's picture

Margin debt disappears, in the same way it appears, like magic.

BuddyEffed's picture

You forgot Walmart, PIIGS, Venezuela, Brazil, sports leagues, Vegas, etc.

shantyman's picture

Let me see...Who would have the highest counter party risk......whose fingers are ALWAYS caught in the blender when it turns on....Hmmmmm...I know Deutsche Banko!!!!!!!!!!!! 

Mentaliusanything's picture

But The Stockmarket... forward looking and all that razzle dazzle.

Surely NOT.

adr's picture

Don't worry, trillion dollar Apple, Facebook, Google, Amazon, and Netflix will save us all.

thisguyoverhere's picture

Damn, so thats what happened to the fresh exotic fruit supply.

I was wondering . . .

When the pain becomes unbearable, will go long transports.

What comes down must come up.

rahtidmon's picture
rahtidmon (not verified) thisguyoverhere Mar 3, 2016 8:29 PM

In days of old, when men were bold, they wiped their ass with dry grass, and went off quite contented.