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I get that this is an interesting datapoint in the global economy, but how is this at all related to Hackernews?

theandrewbailey 11y ago
This is mildly concerning to me: I work in ecommerce! This apparently means that less raw materials are flowing around than ever, and, eventually, fewer goods will be produced and sold.
- RyanZAG 11y ago
  Not exactly - three years ago the shipping demand hit an all time high. Large container companies began building new never-before-seen super cargo ships which can carry an enormous amount of cargo. These ships rolled out of the production line earlier this year and have had a very heavy impact on shipping. The slowdown in the Chinese economy compounded this, as China is one of the largest users of shipping. As the Chinese economy picks up and global trade values continue to rise with growing populations, this effect should decrease and you should see shipping prices rise. Compounding this is that smaller shipping companies are being merged into larger ones as the low prices make their business unsustainable. So you can also expect this index to spike rapidly in the future as consolidation occurs.
rrggrr 11y ago
Most HN partipants rely on brick and mortar businesses, directly or indirectly, as first or second order revenue sources. The Baltic Dry Index is telling us that an unprecedented slowdown in global trade is occuring, the impact of which will be felt by tech firms building and selling logistics solutions, payment platforms, inventory systems, accounting applications, financial modeling software and so much more. The VC community is paying close attention to the global economy, which will impact their willingness to invest. I enjoy reading about undocumented Python regular expression libraries as much as the next guy, but a deflationary spiral spinning unabated is going to impact all our lives far more and very soon.
- jacquesm 11y ago
  It's not unprecedented, the previous time this happened a global crisis was about to get underway. This is what makes (or rather, maybe made) this particular index so interesting, the fact that it doesn't lag but gave a warning ahead of time. Of course once that happens everybody will adjust their models so this won't repeat. But the previous recorded drop in this particular shipping index was a harbinger of some pretty bad news.
  - toomuchtodo 11y ago
    What was the lag time between the last time happened and financial crisis began?
    - jacquesm 11y ago
      95% drop or so between May and Dec 2008.
      - toomuchtodo 11y ago
        Thank you!
  - rrggrr 11y ago
    The duration of this decline is unprecedented. In 2008 indicators bounced back in months. This decline started in late 2013 early 2014 and appears to be increasing in intensity.
- blobbers 11y ago
  The BDI has been in the toilet for along time. I'm merely pointing out that this is supposed to be hackernews, not zerohedge.

This is mildly concerning to me: I work in ecommerce! This apparently means that less raw materials are flowing around than ever, and, eventually, fewer goods will be produced and sold.

RyanZAG 11y ago
Not exactly - three years ago the shipping demand hit an all time high. Large container companies began building new never-before-seen super cargo ships which can carry an enormous amount of cargo. These ships rolled out of the production line earlier this year and have had a very heavy impact on shipping. The slowdown in the Chinese economy compounded this, as China is one of the largest users of shipping. As the Chinese economy picks up and global trade values continue to rise with growing populations, this effect should decrease and you should see shipping prices rise. Compounding this is that smaller shipping companies are being merged into larger ones as the low prices make their business unsustainable. So you can also expect this index to spike rapidly in the future as consolidation occurs.

rrggrr 11y ago

Most HN partipants rely on brick and mortar businesses, directly or indirectly, as first or second order revenue sources. The Baltic Dry Index is telling us that an unprecedented slowdown in global trade is occuring, the impact of which will be felt by tech firms building and selling logistics solutions, payment platforms, inventory systems, accounting applications, financial modeling software and so much more. The VC community is paying close attention to the global economy, which will impact their willingness to invest. I enjoy reading about undocumented Python regular expression libraries as much as the next guy, but a deflationary spiral spinning unabated is going to impact all our lives far more and very soon.

jacquesm 11y ago
It's not unprecedented, the previous time this happened a global crisis was about to get underway. This is what makes (or rather, maybe made) this particular index so interesting, the fact that it doesn't lag but gave a warning ahead of time. Of course once that happens everybody will adjust their models so this won't repeat. But the previous recorded drop in this particular shipping index was a harbinger of some pretty bad news.
- toomuchtodo 11y ago
  What was the lag time between the last time happened and financial crisis began?
  - jacquesm 11y ago
    95% drop or so between May and Dec 2008.
    - toomuchtodo 11y ago
      Thank you!
- rrggrr 11y ago
  The duration of this decline is unprecedented. In 2008 indicators bounced back in months. This decline started in late 2013 early 2014 and appears to be increasing in intensity.
blobbers 11y ago
The BDI has been in the toilet for along time. I'm merely pointing out that this is supposed to be hackernews, not zerohedge.