Shipping rates hit zero as trade sinks | Hacker News Reader

Shipping rates hit zero as trade sinks

telegraph.co.uk

17 pointschaostheory16 comments

I was already looking in to this couple of weeks ago. BDI was up till December and it just hit the bottom in January.

BDI is a nice indicator of economy because 1) it's not speculative(you don't buy shipping without products), 2) it's not elastic(it takes years to build another ship and it's not easy or cheap to take ships of circulation).

Good article on the BDI: http://www.wikinvest.com/stock/Baltic_Dry_Index_-_BDI_(BALDR...

these bits and pieces of financial news (eg. 'An MIT Blackjack team perspective on the economy' on HN today) make it difficult to get the whole picture of how serious an economic contraction we're going to see in the next few years. It also is difficult (for myself at least) to understand what this means for the average guy on the street. Are we talking Depression era job/food lines? Something worse?

If anyone could actually predict that... the would keep it to themselves and make a fortune. Of course, no one really can, so we get lots of hand waving, theories and speculation, some of which are more reasoned and intelligent than others. We also get lots of people trying to Prove a Point about their particular political/economic views.

Forget predicting the future, there is plenty of data on the present. Here are some nice graphs:

http://www.minneapolisfed.org/publications_papers/studies/re...

Thanks for the v. useful link (and like your website :)

Most disasters can be predicted at some point before they strike, by at least some subset of observers.

Your comment implies that in the case of a disastrous implosion of the global economy, the window of predictability would be so narrow that there would be no point in trying to anticipate it; and that while we wait to see what's going to happen, there's no use listening to the ongoing chatter of "hand waving, theories and speculation".

But is that really true?

I think it behooves us to keep evaluating information as it streams in. (Attempting to discount the speculators and "people trying to Prove a Point, as always.)

"Most disasters can be predicted at some point before they strike, by at least some subset of observers."

The lucky ones?

The ones lucky enough to interpret their data stream correctly.

Sure. But saying that some people can predict something, does not mean that it is 'predictable'.

I think what you're getting at is that there's a distinction between predicting well, vs. just guessing, and having your guess turn out to be correct.

This is true. In the case of repeatable events, over time, the former will do better than chance and the latter will do as well as chance.

I'm talking about the former, not the latter.

You should read "The Black Swan" - the book has flaws, but he does make a convincing case for people being simply unable to predict certain things. They make up stories afterwards, but those stories aren't able to predict the next big, unexpected thing.

Ugh, I can see my writing has been very unclear in this thread.

Anyway thanks for the recommendation.

"The World Bank caused shockwaves with a warning last month that global trade may decline this year for the first time since the Second World War. This appears increasingly certain with each new batch of data.

"Mr de Trenck predicts Asian trade to the US will fall 7pc this year. To Europe he estimates a drop of 9pc -- possibly 12pc. Trade flows grow 8pc in an average year."

Shipping journal Lloyd's List said brokers in Singapore are now waiving fees for containers travelling from South China, charging only for the minimal "bunker" costs. Container fees from North Asia have dropped $200, taking them below operating cost.

Industry sources said they have never seen rates fall so low. "This is a whole new ball game," said one trader.

Perhaps trade could be encouraged to healthy levels by subsidizing importation.

I wonder how many of those who demonize trade realize that high volumes of trade are associated with good economic times and low volumes of trade are associated with the opposite.

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