What’s this index’s track record in predicting those?
Posted on 01/30/2015 7:57:56 AM PST by SeekAndFind
The Baltic Dry Index just hit a 28-year low. The index drew attention for mapping the financial crisis, going through the floor as the global economy tanked in 2008, but it just slumped to an even lower level. The index measures shipping costs for dry bulk commodities (minerals and metals like coal and iron, as well as grain and other food).
It plunged by more than 90% in just a few months in 2008 as the global crisis unrolled. Then, it was an impressive bellwether for the global situation.
Shipping costs were previously so expensive because demand was strong and enormous cargo ships can't be built overnight. As the demand disappeared, the Baltic Dry dived.
It has now dropped by more than 50% in less than three months.
(Excerpt) Read more at businessinsider.com ...
Two comments on that thought:
1) Yeah, I'll beleive it when I see it.
2) When has a Washington "reform" ever turned out good for the citizens? The Beast will never willingly give up control.
Yes, and after the alarmist headline the body of the article explains why this drop doesn’t mean what the last drop meant.
What’s happening with BRI is to be expected and part of the cross currents of the new normal (for now) price of oil.
What to watch for now is how quickly the lowered active rig count translates into lower oil production. And will the Saudis increase production if needed to keep the price under $50?
It seems to me there’s been a total disconnect of the stock market from economic reality for a very long time, namely due to essentially unlimited Fed money printing, and as long as the money printing continues unabated, the stock market is likely to stay propped up no matter what happens, at least until the merry-go-round comes to a screeching halt and the whole shebang collapses because the money becomes worthless.
The number of years it will take for that to happen is unknown because the U.S. is by far the richest nation in history to debase its currency, and mostly all we have for examples are poor, non-productive countries and countries with limited populations, limited wealth, and limited production from the past.
Good point. This has gone on a lot longer than I expected. It's like we have a zombie economy.
Back in the 90s I honestly believed we'd have sunk well before now. I missed the entire run up of the markets the last four years. Frustrating because I really needed the money at my age. Now, I'd be insane to gamble that this will go on another 2 years. But it could. Insanity.
Now that is a scary chart.
I believe they will unless they become too alarmed about political chaos in the region. They are ruthless.
America has always done poorly with middle easterners and orientals because our leaders are ignorant about how they think and refuse to learn. Egocentric.
Nah. They’ll just do the same thing the Federal Reserve is doing here: their central bank will buy government bonds at low interest and use those “assets” to shore up the domestic banking system. The central bank will allow the bonds to be rolled over at low interest in perpetuity, with the principal never having to be paid back.
I hope you are right. I am a bit too jaded on the subject to hope very much, though.
No, but there are major ‘swoonogenic’ problems in the global economy that could make ‘suffocating’ look like the good times.
I've never heard the term 'Industrial Farming'.
What is it, and with over 90% of American farm production coming from family farms, how does it apply to the US?
Most of the family farms are industrial farms now. They use huge machinery and tons of chemicals to farm a single crop usually. Farms used to be setup with a system where you had many different crops and livestock and you had a system that supported itself. The animals would graze and eat fodder grown in the fields and then their manure reinvigorated the field. Then the farmer would let that field set for a year and he would harvest hay from it moving the livestock to another field. And a year or two after farming hay he would plant a crop in it and the new hay field would be where the livestock was last year. Then the old field where the farmer had planted crops a couple of years or more ago would have returned to grass after they sit awhile and they become the future grazing fields.
Our whole farming system was changed with the advent of the gas powered tractor and chemical fertilizers we dropped the old way of farming and single crop farms started to become the norm and it steamrolled in the 70s. BTW industrial farming was one of the causes of the Dust Bowl back in the thirties.
Now we have created a synthetic cycle in the farming system where we grow mostly corn and soybeans and then the corn goes to feed livestock even though most aren't geared to digest corn. This causes all sorts of unintended consequences like large outbreaks of very resistant e-coli. Because the digestive system of livestock is not geared to properly digest corn. It would be akin to humans eating nothing but cheese everyday you would get nice and fat but be very unhealthy and thus the same happens to the livestock so they add all sorts of antibiotics to try and keep the cows getting sick and this causes very resistant e-coli outbreaks because the e-coli love to grow in the stomachs of livestock who eat nothing but corn products.
Does that help to clear up the matter?
As some who farmed for many, many years, and has relative who ranch and farm, and still is in close touch with the business of farming, I stopped there, as that statement isn't even within the shadow of the truth.
You can come back from a swoon. A suffocation will leave you dead.
Like who is failing to rotate... that sounds so ignorant of the fellow. And I’m not even a farmer
Rush was talking about this very thing, on his show, this morning. And how this factor is what makes capitalism *unfair* (he was responding to the leftist meme about how unfair capitalism is).
I see so you are saying most American farmers don't use large machinery and chemicals and farm mostly a single crop?
We have visited a dairy farm every spring for the last few years because the local FFA and other groups showcase what a functioning dairy farm is like. One year they were using cotton husks in the feed to help digestion. The next year cotton husks were too expensive so they added other products to the feed to help. It is such a science.
Where as beef cattle are fed a corn based feed that has a huge amount of antibiotics included to get them fat in a really short time to increase the sale price. I got to see a large cattle feedlot up close. Thousands of cows are in a very small field with no grass just wading around in fecal matter and mud. The smell was almost to the point of making one gag and we were far away from where the water runoff from the feedlot was. The guys that work there said no one goes near it because even they can't take the stench.
On a traditional farm cows would never have been that concentrated to overload the field with fecal matter. But industrial farming methods don't use the natural cycle of using livestock to fertilize the fields because it is much slower.
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