I'm sniffing around commodities, looking for a BOUNCE. Nothing more.
From 12 000 to 2 000 is simply amazing. Demand did NOT fall off that fast.
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Baltic Dry Index: Smashed, Global Demand
Tuesday, October 14, 2008
Baltic Dry Index: Amazing Plunge
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10 comments:
Ben
Among the extraneous items affecting the BDI at its peak was insufficient capacity at Chinese ports. Stories had it that waits to unload were up to a month long. The story wasn't strictly demand vs. capacity.
Hedge funds did get called that fast however. We have to wait for complete equity capitulation to see where the market in commodities truly stands.
Wonder if the banks balking at honoring Letters of Credit could have any influence? Seems to me it would....
"Wonder if the banks balking at honoring Letters of Credit could have any influence? Seems to me it would...."
My thoughts as well unscripted.
Ben - Is this not what the data suggests?
You know, people would accord you the degree of seriousness you deserve if you stopped with the stuff like "bulltards". That's just childish, and truly not befitting the quality of your analysis.
Index just now getting back to where it was in early 2006.
Talk about a bubble.
What's a good vehicle for buying this thing Ben? DRYS? NAT?
Bulltards is perfect. Keep it!
1) Agree with Sev, keep Bulltards.
2) I'm not sure you're reading the BDI drop correctly. By definition of the BDI, demand DID, in fact, fall that far, that fast. BDI is not an index of Dry Bulk Shippers, it is purely Dry Bulk Shipping rates. Thus, it is, by definition, demand, rather than a proxy for it (as would be the equities of such dry bulk shippers as DRYS, TOPS and others like FRO for non dry bulk shipping). The rates are what they are.
That said, a commodities equity bounce could very well be in the cards, though I don't think a bounce in commodities itself will play out very extensively . . . of course, you're the pro, not me.
-Mike J
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