Wednesday, October 22, 2008

Update on Trade Slowdown

The Bailout still hasn't thawed the credit markets as international shipping continues to slow down because letters of credit from banks are not being honored by sellers. Livemint.com reported:
"Dry bulk shipping has been on a roll and what we are seeing is completely unprecedented,” said Anjali Kumar, spokesperson for Great Eastern Shipping Co. Ltd, the country’s biggest private shipping firm. “Fortunately, the tanker sector is doing well and is helping us cope with the situation.”
The Baltic Dry Index, a benchmark for shipping bulk commodities, on 17 October tumbled nearly 7% from 1,615 points to 1,506, its lowest since November 2002. The index has plunged 53.2% since the end of September, and 86% since 20 May, when it had hit a high of 11,893 points....

“Traders who hire ships on spot basis are facing difficulties to secure letters of credit from banks,” said an executive at Chowgule Steamships Ltd, who did not want to be named. Letters of credit assure a shipper of payment for a cargo after it is loaded on a ship, but before the buyer receives it.
The squeeze on trade credit is also restricting commodities shipments. Around 90% of the world’s $14 trillion (Rs683 trillion) trade is handled via trade credit, the SCI official said.
“You don’t know the credit worthiness of the guy hiring the ship
... The best and the biggest of names are defaulting,” said an executive at Apeejay Shipping Ltd, who too did not want to be named
......" http://www.livemint.com/2008/10/21005334/Shipowners-see-business-slowin.html

Meanwhile, The Economist picks up the story as it gains more steam in the mainstream media:
"Since the early summer the prices of various kinds of steel have fallen by 20-70%, iron ore is down by a third and the key rate for bulk shipping of commodities such as iron ore, coal and grain is down by more than four-fifths. There is even talk of grain cargoes piling up in ports in the Americas. Their buyers’ letters of credit have not been honoured, because of a lack of confidence in the banks that underwrite them. At least one Australian producer has had the same problem with iron-ore shipments. And shipowners are struggling to finance new vessels they have ordered....." The Economist

Steel Guru reported the same as well:
"The Baltic Dry Index stood at 1506 as the week ended a massive fall from the 11,893 points at which it stood as recently as May 2008. The problem is not just the market's view on forward demand for commodities, although that is a large part of it. Rather, it's the global credit crunch. Reports from London indicate that ship owners are having trouble getting banks to sign off on letters of credit for the cargoes..." Steelguru.com

It is clear the global credit crunch is affecting international trade as there are more reports every day on shipping falling off due to sellers not honoring trade credit and letters of credit. This is the real economy. While the money honey gets mad about the Dow, this might be where the real story is as it affects the everyday lives of Americans much more quickly and directly than does a thousand point drop in the Dow.

Earlier posts:
http://kingfish1935.blogspot.com/2008/10/bloomberg-letters-of-credit-frozen.html
http://kingfish1935.blogspot.com/2008/10/time-to-wake-up.html
http://kingfish1935.blogspot.com/2008/10/more-news-about-grain-piling-up-in.html
http://kingfish1935.blogspot.com/2008/10/international-trade-shutting-down.html

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Trollfest '09

Trollfest '07 was such a success that Jackson Jambalaya will once again host Trollfest '09. Catch this great event which will leave NE Jackson & Fondren in flames. Othor Cain and his band, The Black Power Structure headline the night while Sonjay Poontang returns for an encore performance. Former Frank Melton bodyguard Marcus Wright makes his premier appearance at Trollfest singing "I'm a Sweet Transvestite" from "The Rocky Horror Picture Show." Kamikaze will sing his new hit, “How I sold out to da Man.” Robbie Bell again performs: “Mamas, don't let your babies grow up to be Bells” and “Any friend of Ed Peters is a friend of mine”. After the show, Ms. Bell will autograph copies of her mug shot photos. In a salute to “Dancing with the Stars”, Ms. Bell and Hinds County District Attorney Robert Smith will dance the Wango Tango.

Wrestling returns, except this time it will be a Battle Royal with Othor Cain, Ben Allen, Kim Wade, Haley Fisackerly, Alan Lange, and “Big Cat” Donna Ladd all in the ring at the same time. The Battle Royal will be in a steel cage, no time limit, no referee, and the losers must leave town. Marshand Crisler will be the honorary referee (as it gives him a title without actually having to do anything).


Meet KIM Waaaaaade at the Entergy Tent. For five pesos, Kim will sell you a chance to win a deed to a crack house on Ridgeway Street stuffed in the Howard Industries pinata. Don't worry if the pinata is beaten to shreds, as Mr. Wade has Jose, Emmanuel, and Carlos, all illegal immigrants, available as replacements for the it. Upon leaving the Entergy tent, fig leaves will be available in case Entergy literally takes everything you have as part of its Trollfest ticket price adjustment charge.

Donna Ladd of The Jackson Free Press will give several classes on learning how to write. Smearing, writing without factchecking, and reporting only one side of a story will be covered. A donation to pay their taxes will be accepted and she will be signing copies of their former federal tax liens. Ms. Ladd will give a dramatic reading of her two award-winning essays (They received The Jackson Free Press "Best Of" awards.) "Why everything is always about me" and "Why I cover murders better than anyone else in Jackson".

In the spirit of helping those who are less fortunate, Trollfest '09 adopts a cause for which a portion of the proceeds and donations will be donated: Keeping Frank Melton in his home. The “Keep Frank Melton From Being Homeless” booth will sell chances for five dollars to pin the tail on the jackass. John Reeves has graciously volunteered to be the jackass for this honorable excursion into saving Frank's ass. What's an ass between two friends after all? If Mr. Reeves is unable to um, perform, Speaker Billy McCoy has also volunteered as when the word “jackass” was mentioned he immediately ran as fast as he could to sign up.


In order to help clean up the legal profession, Adam Kilgore of the Mississippi Bar will be giving away free, round-trip plane tickets to the North Pole where they keep their bar complaint forms (which are NOT available online). If you don't want to go to the North Pole, you can enjoy Brant Brantley's (of the Mississippi Commission on Judicial Performance) free guided tours of the quicksand field over by High Street where all complaints against judges disappear. If for some reason you are unable to control yourself, never fear; Judge Houston Patton will operate his jail where no lawyers are needed or allowed as you just sit there for minutes... hours.... months...years until he decides he is tired of you sitting in his jail. Do not think Judge Patton is a bad judge however as he plans to serve free Mad Dog 20/20 to all inmates.

Trollfest '09 is a pet-friendly event as well. Feel free to bring your dog with you and do not worry if your pet gets hungry, as employees of the Jackson Zoo will be on hand to provide some of their animals as food when it gets to be feeding time for your little loved one.

Relax at the Fox News Tent. Since there are only three blonde reporters in Jackson (being blonde is a requirement for working at Fox News), Megan and Kathryn from WAPT and Wendy from WLBT will be on loan to Fox. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both and a torn-up Obama yard sign will entitle you to free drinks served by Megan, Wendy, and Kathryn. Get your tickets now. Since this is an event for trolls, no ID is required. Just bring the hate. Bring the family, Trollfest '09 is for EVERYONE!!!

This is definitely a Beaver production.


Note: Security provided by INS.

Trollfest '07

Jackson Jambalaya is the home of Trollfest '07. Catch this great event which promises to leave NE Jackson & Fondren in flames. Sonjay Poontang and his band headline the night with a special steel cage, no time limit "loser must leave town" bout between Alan Lange and "Big Cat"Donna Ladd following afterwards. Kamikaze will perform his new song F*** Bush, he's still a _____. Did I mention there was no referee? Dr. Heddy Matthias and Lori Gregory will face off in the undercard dueling with dangling participles and other um, devices. Robbie Bell will perform Her two latest songs: My Best Friends are in the Media and Mama's, Don't Let Your Babies Grow up to be George Bell. Sid Salter of The Clarion-Ledger will host "Pin the Tail on the Trial Lawyer", sponsored by State Farm.

There will be a hugging booth where in exchange for your young son, Frank Melton will give you a loooong hug. Trollfest will have a dunking booth where Muhammed the terrorist will curse you to Allah as you try to hit a target that will drop him into a vat of pig grease. However, in the true spirit of Separate But Equal, Don Imus and someone from NE Jackson will also sit in the dunking booth for an equal amount of time. Tom Head will give a reading for two hours on why he can't figure out who the hell he is. Cliff Cargill will give lessons with his .80 caliber desert eagle, using Frank Melton photos as targets. Tackleberry will be on hand for an autograph session. KIM Waaaaaade will be passing out free titles and deeds to crackhouses formerly owned by The Wood Street Players.

If you get tired come relax at the Fox News Tent. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both will entitle you to free drinks.Get your tickets now. Since this is an event for trolls, no ID is required, just bring the hate. Bring the family, Trollfest '07 is for EVERYONE!!!

This is definitely a Beaver production.

Note: Security provided by INS
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