Skip to comments.The BDI May Have Collapsed, But Check Out The Shipping Rebound Everybody's Missing
Posted on 07/07/2010 10:23:22 AM PDT by blam
The BDI May Have Collapsed, But Check Out The Shipping Rebound Everybody's Missing
Vincent Fernando, CFA
Jul. 7, 2010, 1:07 PM
The recent plunge of the Baltic Dry Index has by now been relatively well documented. Thing is, the Baltic Dry measures shipping rates for just one facet of the economy -- primarily dry bulk commodities demand from developing nations (mostly China) against global dry bulk ship supply.
What many have missed, however, has been the surging rates for container shipping, which primarily measure demand for products from developed nations (mostly the U.S. and Europe) against global container ship supply.
On this front, the data shows a continued rebound, which oddly began just around when markets renewed their bearishness vs. Europe and the U.S.:
Just a near-term lagging blip about to collapse? Market participants don't think so:
Braemer Shipping Services July 5th:
Lines are prepared to pay a slight premium at this stage to secure suitable tonnage longer term and therewith hedging themselves against potentially further rising rates... In general, it is apparent that the confidence in the market is returning, highlighted by ever more new faces appearing on the scene looking at capitalising on the opportunities available.
Note that the above index doesn't apply to bulk shipping companies such as DryShips (DRYS) or Diana (DSX), but rather to container shipping companies such as Neptune Orient (NOL SP) in Singapore or Seaspan (SSW, though seaspan will have long-term contracts).
(Excerpt) Read more at businessinsider.com ...
Could be the Christmas booty in the system on it’s way to consumers who already have everything and no money or space to put anything else.
"Doug Kass Tweeted the other day that the thought the market had seen the bottom. Today he appears on TechTicker to explain his views a bit further. The gist: he's not a permabear or a permabull, but he does think sentiment has swung way too far to the negative side, and that it's time to buy."
Well, they gotta have something to suffice as housing units on those re-education camps
tin foil hat mode off
Of course markets will go up-eventually.
Sounds good....Kass has a decent record...about time for him to show up on Kudlow.
The market has seen the bottom of this weekly cycle, based on the VIX being past its recent peak and stochastics being oversold.
The shorts will now buy back their positions, and allow the market to psych itself into thinking that maybe the double dip won’t happen. The VIX will bottom out, stochastics will become overbought, and then the next leg down begins.
I am now firmly convinced that the market is 100% rigged by a few powerful players. The “news” is cast in a positive light on the way up, and a “negative” light on the way down, all to accentuate the market fluctuations. Goldman Sachs and JP Morgan are the ringleaders, with months and months of 100% winning trades. This is not possible unless the timing of the turns is dictated.
The only way to trade is to use technicals, and until the whole system gets flushed out, you just use the 200 day moving average as the ceiling, and sell short. We’ll be lucky if we even break the 50 day moving average. Oh, and don’t forget to set tight stops, especially near oversold or over bought conditions.
Being in manufacturing and serving a number of industries, I can feel the pulse of the economy.
There has been a recent pickup and customers tell me it’s Porkulus money entering the system. For example, we work on huge pumps for municipal water systems. They are using stimulus money to buy pumps that they could not afford before.
The Mal-Administration is trying to pump up the economy before November, and I’ll bet the State Controlled Media will help them hide the fact that Porkulus is behind any good economic news.
I've been expecting pre-election pumping.