The Most Revolutionary Act

Diverse Ramblings of an American Refugee

Dr Stuart Jeanne Bramhall

Dr Stuart Jeanne Bramhall
Location
New Plymouth, New Zealand
Birthday
December 02
Bio
Retired psychiatrist, activist and author of 2 young adult novels - Battle for Tomorrow and A Rebel Comes of Age - and a free ebook 21st Century Revolution. My 2010 memoir The Most Revolutionary Act: Memoir of an American Refugee describes the circumstances that led me to leave the US in 2002. More information about my books (and me) at www.stuartjeannebramhall.com

MY RECENT POSTS

DECEMBER 18, 2012 7:27PM

Is Global Trade on the Verge of Collapse

Rate: 1 Flag
photo credit Zero Hedge

photo credit Zero Hedge

Man the Lifeboats – She’s Going Down!

Picking up on a December 12th post by Tyler Durden at  Zero Hedge, Mac Slavo at Blacklisted News warns that a 8.2% overnight drop in the Baltic Dry Index (from 900 to 826the biggest drop since 2008) suggests that global shipping and trade are in deep trouble.

How Come They Don’t Teach This Stuff in School?

The Baltic Dry Index (BDI), issued by the London-based Baltic Exchange, was established in 1985 as a measure of the global shipping rates of dry bulk goods. As Durden and others argue, the BDI is an excellent measure of the demand for these goods. When countries are importing and exporting like mad, demand for container space increases and global shipping companies increase their prices. When global trade declines, they reduce them. According to Durden, Slavo and other reputable market watchers, big swings in the BDI are very predictive. A 95% drop in the BDI preceded the Wall Street crash in 2008.

The BDI (and global trade) recovered somewhat with the stimulus measures Obama enacted. Then in January 2012 it precipitously dropped again – by 65% in one month (from above 1600 to 726).

As you can see from the Zero Hedge chart above the BDI recovered a bit in subsequent months, but never to the levels it enjoyed in 2009 and 2010 (which were drastically lower than 2007 and 2008 levels).

Hellenic Shipping News expressed similar concerns about the December 12th BDI drop. They correlate the price decline with a 3.6 percent drop in US exports (in October). This was the biggest percentage drop since 2009.

According to the latest Dry Ships Inc report posted at their website, the BDI has continued to drop. On Friday December 14th it was 794.

As Durden states in a January 2012 post about the BDI, “Despite the astonishing amount of manipulation that goes into our fiscal system by major banks, there are still a few fundamental rules to economics that never change. The bottom line? Demand around the world is derailing, hinting at a broad spectrum disintegration of public buying power.Where demand goes, so goes the economy.”

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Comments

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Another nail in the coffin of predatory Supply Side American style greed capitalism.

Little by little it unravels. Squirm as they might they'll not stop the inevitable crunch.

What then will people say as the private militias, full of gun nut NRA types, become the survivors?

Hot times is'a comin', fer sure, fer sure!
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