Shipbuilding in Japan, Korea, China Collapses in Death Spiral of Orders

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“Worse than the one following the Global Financial Crisis.”

New orders received by Chinese shipyards – now infamous for undercutting competitors and sinking into bankruptcy – have plunged 58.5% so far this year through October, compared to last year, according to shipping industry data provider BIMCO, cited by the Nikkei. At South Korean shipyards, which include the three largest in the world, orders have plunged 84.2%; at Japanese shipyards, 90%.

They all focused on large dry-bulk vessels, tankers, and containerships. But this year, orders for tankers globally plunged 80% and for container ships 84%.

Global trade, which collapsed during the Financial Crisis but then recovered in a V-shaped manner, was expected to continue soaring. Instead, it has languished over the past few years. Carriers that transport these goods in dry-bulk vessels, tankers, and container ships, face rampant overcapacity and crushed shipping rates. Smaller ones have sunk. In August, Hanjin, the sixth largest carrier and a formerly too-big-to-fail company in South Korea, was allowed to fail. And they all stopped ordering ships.

However, orders at European shipyards have jumped 45% through the first eight months this year. On the global scale, they’re small players, accounting for only 9.3% of the order book. But they focus on the smaller thriving market for cruise ships, ferries, and tugs.

Globally, orders for ships plunged 77% so far this year through October. But 2015 had already been down 13% from 2014. And 2014 had been down 26% from 2013, the first good year since before the Financial Crisis. In 2007, orders had peaked at 92 million compensated gross tons (CGT). So far this year, orders are down to 10 million CGT.

At this rate, 2016 will be the worst year in BIMCO’s data series going back to 1996. Even back then, orders amounted to 18 million CGT.

No industry can survive for long when orders collapse at these rates. But next year might be worse, according to Peter Sand, BIMCO’s chief shipping analyst. For the Asian shipbuilders concentrated in the container, dry-bulk or offshore segments, “there is a possibility for postponements and cancellations.” Outright cancellations are bad enough. But “postponements can add a further headache to the shipyards’ liquidity, as the final payments in these cases may be delayed.”




Among the collapsed shipbuilders is South Korea’s STX Offshore & Shipbuilding, which filed for court protection in May. No country is more dependent on shipbuilding than South Korea: it accounted for 7.1% of manufacturing jobs in 2015.

Korea’s Big Three – Hyundai Heavy Industries, Daewoo Shipbuilding & Marine Engineering, and Samsung Heavy Industries – have been dumping noncore assets and shedding employees as part of prior creditor-led restructuring plans. Even that wasn’t enough. At the end of October, the government announced a bailout plan: it would order 250 vessels through 2020, valued at $9.6 billion, but they’ll be smaller ships and boats, not the big, former money-makers that these shipyards really need.

That may not be enough either. On November 15, Hyundai Heavy announced it would sell its non-shipbuilding businesses, including utilities, construction equipment manufacturing, and robotics, to get out from under its suffocating load of debt. Samsung Heavy said it would lay off 30% to 40% of its 14,000 employees by 2018. Daewoo Shipbuilding said it would lay off 20% of its employees by 2020.

In China, bankruptcies are piling up. In April and May:  Zhong Chuan Heavy Industry, Zhong Chuan Heavy Industry Equipment, Zhoushan Xuhua Metal Material, Zhenjiang Shipbuilding (subsidiary of Sinopacific Shipbuilding Group), and Yangzhou Dayang Shipbuilding. Plus, in February, state-owned Sainty Marine; in December 2015, state-owned Wuzhou Shipyard; and earlier in 2015, privately owned Mingde Heavy Industries.

But many of these failed shipbuilders, propped up by state-owned lenders, continue to exist and get orders by undercutting prices and producing below production costs. They’re called zombies.

In October, Guo Dacheng, chairman of the China Association of the National Shipbuilding Industry, said that these zombies should be quickly weeded out, according to the Nikkei; they were damaging the entire industry.

To say alive, other shipbuilders are diversifying away from dry-bulk carriers and container ships; they’re now trying to muscle in on European shipyards by building ferries and cruise ships. If they do this successfully, they’ll create the next glut and collapse.

It won’t be easy. Japan’s big shipbuilders are already trying to diversify into cruise ships, but that hasn’t worked out very well yet. The Nikkei:

After a pause of around a decade, Mitsubishi Heavy Industries restarted building large passenger ships in 2013, a more lucrative segment than container ships. However, the company indicated in October that its Nagasaki Shipyard & Machinery Works unit had lost more than 250 billion yen ($2.25 billion) on an order from a U.S. cruise line for two vessels amid repeated design changes and costs from importing European equipment.

As a consequence, Mitsubishi said in October that it will only accept orders from hereon for smaller passenger vessels while seeking more orders for LNG carriers.

So now, the big Japanese shipbuilders are trying to stay alive by consolidating. Imabari Shipbuilding (5th largest in the world), Oshima Shipbuilding, and Namura Shipbuilding all specialize in dry-bulk carriers. Now they’re in discussions with Mitsubishi Heavy about putting their resources together and get into cruise ships. Combined, they’d make the second largest shipbuilder in the world, if they all survive long enough to get out of this slump.

It could take a while. “The industry won’t recover until 2021,” explained Yoshikazu Nakaya, a shipping analyst with Mizuho Bank. He called the fiasco “worse than the one following the Global Financial Crisis.”

The US is the largest destination for global goods. But the next brake shoe is about to drop. The “Car Recession” is now expected to spread to 2017. Read…  Strongest Pillar of Shaky US Economy has Cracked




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  54 comments for “Shipbuilding in Japan, Korea, China Collapses in Death Spiral of Orders

  1. November 24, 2016 at 9:46 pm

    Marx was right – – OVRPRODUCTION

    I remember reading his theories – as a young pup – in college

    This link, the second section on crises, tells it straightforwardly :

    https://www.marxists.org/history/etol/newspape/socialistvoice/marx19.html

    One could imagine that ZIRP and NIRP are the provocateurs here ?

    Then we have what von Mises said about the collapse of a boom brought on by credit expansion :

    http://www.quotesonfinance.com/quote/48/Ludwig-von-Mises-The-final-collapse

    “There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved. ”

    This is all due to the FED, IMO

    As a confirmed atheist, I have no need for concepts of sin and evil. HOWEVER, the FED is EVIL and must be eradicated. Forgive my sin of abandoning my ( lack of ) beliefs and calling the FED “Evil” .

    SnowieGeorgie

    • d
      November 25, 2016 at 1:56 am

      The over production, and overcapacity in, shipbuilding and shipping in china, Is a deliberate, state funded, act, of global financial warfare.

      Marx never mentions deliberate state funded over production in his theories, or the true reasons for them.

      He who controls the ships, controls the trade.

      china intendeds to control, the ships, and the making of them as well.

      A group of chines officials have been danceing on tables in private club’s since the brake up of hanjin was announced.

      Their only sorrow is that they have destroyed a major Korean company, before all the Japanese majors.

    • meofios
      November 25, 2016 at 8:59 am

      capitalist crisis is overproduction, communist crisis is shortages: not enough toilet paper, bread lines. which do you prefer?

      • Petunia
        November 25, 2016 at 1:13 pm

        “Communists stand in line for bread, capitalist stand in line for iphones.”
        — Read it somewhere recently. “Chaos Monkeys”, I think.

        • Álvaro
          November 26, 2016 at 7:28 am

          A lot of capitalists also stand in line for bread.

      • Graham
        November 28, 2016 at 11:00 am

        We haven’t had capitalism for over 100 years, there’s no ‘Central’ (as in Central Bank) in the word or definition of Capitalism.

        We have a corporate Oligarchy that has no risk (no tax but taxpayer funded bailouts) and a patent system to bend the market onto it’s knees as the main weapon against competition.

    • November 25, 2016 at 10:29 am

      Ha – Never assign to malice what can best be ascribed to stupidity.

      The Fed aren’t evil, that is a nonsense concept. The Fed are a bunch of incompetent and frail of character numpties.

      Your appeal to religious rhetoric won’t wash around here George.

      • November 25, 2016 at 12:03 pm

        I was being sarcastic and ironic and absurd.

        Needed to post /sarc, and I will next time. Sigh .

        SnowieGeorgie

        • Petunia
          November 25, 2016 at 1:08 pm

          I still FORGIVE you.

          BTW, economics was one of my majors and they never taught Marx because he was a communist. Most economists in America are unfamiliar with his work, because he was a communist. /notsarc

    • Maximus Minimus
      November 25, 2016 at 12:23 pm

      And the constant expansion of credit is due to an unanchored currency. The stupidity of the Greenspan/Bernanke FED was to have inflation as the only target. Add to it the Clintonesque free trade uber alles, which depressed prices and wages, and there is a potent cocktail for disaster. Now, the economy needs a constant expansion of credit to prevent implosion. A reset is needed, but it is hard to imagine it would be smooth.
      As someone said here, don’t blame everything on malice when evidence points to stupidity.

      • Winston
        November 25, 2016 at 12:45 pm

        “As someone said here, don’t blame everything on malice when evidence points to stupidity.”

        Hanlon’s Razor – “Never attribute to malice that which is adequately explained by stupidity.”
        Occam’s Razor – “Simpler explanations are generally better than more complex ones.”

        So, is this:

        A) A giant conspiracy
        B) Stupidity via “theory induced blindness.”

        “In his book, ‘Thinking Fast and Slow’, Princeton University Nobel Laureate, Daniel Kahneman, introduces us to the principle of Theory Induced Blindness – the adherence to a vulnerable belief, even though a counterexample may exist, about how something works that prevents you from seeing how it REALLY works. So once you have accepted a theory, it is extraordinarily difficult to notice its flaws, trusting instead the community of experts who have already accepted it.”

        “The mystery is how a conception that is vulnerable to such obvious counterexamples survived for so long. I can explain it only by a weakness of the scholarly mind that I have often observed in myself. I call it theory-induced blindness: Once you have accepted a theory, it is extraordinarily difficult to notice its flaws. As the psychologist Daniel Gilbert has observed, disbelieving is hard work.” – Daniel Kahneman who shared the 2002 Nobel Memorial Prize in Economic Sciences with Vernon L. Smith.

        I’ll take “B” for the win, Alex.

        • Petunia
          November 25, 2016 at 1:20 pm

          You left out

          C) “all of the above — see Climate Change/Gobal Warming for proof”

        • robt
          November 25, 2016 at 3:09 pm

          ‘Economics’ is really about trying to keep the peasants from revolting.

        • November 26, 2016 at 4:25 am

          Quote from your post above : “I call it theory-induced blindness: Once you have accepted a theory, it is extraordinarily difficult to notice its flaws.”

          Reminded me instantly of our wonderful American Literary Genius : “It is easier to fool a person than to convince that person they have been fooled” . attributed to Mark Twain

          http://www.goodreads.com/quotes/584507-it-s-easier-to-fool-people-than-to-convince-them-that

          Well, for me, the older I get, the easier ( relatively speaking ) it has become for me to adjust, or to abandon the cherished beliefs of my youth.

          No point in enumerating my prior false beliefs – – here – – or now.

          SnowieGeorgie

      • Graham
        November 28, 2016 at 11:03 am

        “The constant expansion of credit is due to..”

        The interest rate on debt money.
        We only rent our currency, and have to borrow more to pay the interest. This creates a mathematical expansion of credit our of the box.

        This is then played out as a debt spiral that can be hedged into ‘growth’ or inflation, but the debt spiral is always there.

        All of the worlds ills can be rapidly traced back to Central Banking, which makes communism (etc.) look tame.

    • Frederick
      November 26, 2016 at 1:06 pm

      Parasitical and greedy if thats your definition of evil then yes they are

  2. Petunia
    November 24, 2016 at 9:52 pm

    To All You Climate Change Asserters, You Know Who You Are:

    If the seas are rising and we are all bound to die any day now, how come nobody is investing in ships? It seems like that would be a good idea, assuming you believe that stuff.

    • Edward E
      November 24, 2016 at 10:02 pm

      Actually, it’s going to get bitter cold around 2020 and then warming will begin rocket off with even more of a vengeance around 2023 to really hot 2034. Likely the end of the seesawing. But bridge girders look a lot better with those expensive Xmas ornaments.

      • Edward E
        November 25, 2016 at 9:52 am

        Oh, Petunia, I didn’t intend to insult nobody. By bridge girders ref I was thinking about all the folks that will be living there after the DJT populism doom tour and global governance system gets ramped up.
        Maybe she’s just out for the Black Friday = Broke Saturday frenzy?

        Climatologist Cliff Harris and Meteorologist Randy Mann are who I follow, they have been far and away the most accurate in the last couple of decades of looking into the climate.

    • nick kelly
      November 24, 2016 at 11:00 pm

      Although a sea level rise of 5 feet would make the shores of many coastal cities uninhabitable at a cost of trillions- it would be simpler to head to higher ground than build Noah’s Arks.

      • nhz
        November 25, 2016 at 4:24 am

        Basically agree …

        but the Netherlands and many other major economic areas near sea level cannot even stand 2-3 feet of sea level rise, flooding would get too frequent and no dikes will help because the water will just flow under the dikes. Moving to higher ground means abandoning over half of the country (with by far the biggest chunk of the major infrastructure). I don’t think anyone knows what that would cost. Cheapest solution: rent some ships, evacuate the whole population (maybe to some of the refugee countries, that will be nearly empty by then because they all moved to Netherlands for a life-long paid vacation?).

        It’s a very real problem here but fortunately for politicians, they only have to look ahead 4 years or less. They worry far more about keeping mortgages above water than keeping the country above water. Incidentally, we currently have a TV series that deals with what would happen with a storm surge; politicians and citizens are now far more clueless than during the latest storm surge in 1953 with over 1800 dead and the damage will be far bigger the next time.

        • night-train
          November 25, 2016 at 5:01 am

          A number of coastal cities in the US are already addressing increased flooding and have commissioned studies for future measures. The US Navy doesn’t have the luxury of time for the politicians to get on board. Their facilities are already being impacted, so they began taking measures a couple of years ago. Of course, they have run into trouble with the GOP Congress, which doesn’t want to recognize rising sea levels. We plan to just deny reality. Though, I am not sure how that stops sea level rise. And you have to wonder who is going to pay for all the infrastructure that is going to be needed to deal with the sea level rise that isn’t happening.

        • nhz
          November 25, 2016 at 6:30 am

          @night-trains:
          From what I hear Dutch companies are very active in the US lately developing and building anti-flooding measures. But I think the US coastal areas often have similar problem as in Netherlands: building dikes, storm gates etc. will only help for so long, when sea level rises more than a few feet the water will be simply going under the dikes unless you are lucky with the geology. Forget all the propaganda about floating homes, floating roads, homes on stilts etc.: we have most of that here as ‘experimental’ solutions, but it is at best a niche solution for certain locations.

          One can only hope that the recent projections will not come true; for Netherlands there are now credible estimates of up to 2 meter sea level rise by 2100. Of course it’s even worse for countries at sea level that don’t have the money like Bangladesh.

        • d
          November 25, 2016 at 7:01 am

          “Of course it’s even worse for countries at sea level that don’t have the money like Bangladesh.”

          Land dosent have to go under for there to be big problems, due to past sea level rise.

          Mekong delta.

          Sugar cane, a huge industry, it was.

          Now unusable, even as cattle feed, as it tastes salty. So even cattle wont eat it.

          The water table is changing, as the sea has risen. Yesterday. last year, not next decade, or century.

          This has to start effecting the Mekong Delta rice crops soon. Those rice crop’s feed, or partly feed, over 250 million people in Asia.

          With out the delta rice crops, Vietnam looses its self sufficiency in rice.

          Historically lack of self sufficiency in rice has started wars in Asia BIG ONES.

          Especially as the chinese damming of the upper Mekong, has exacerbated the salinity issues in the delta.

          The chinese get electricity, and the Vietnamese and Cambodians have to import rice or starve. Don’t see that situation lasting .

    • Recyvuym
      November 25, 2016 at 12:57 am

      … what.

    • Tom Kauser
      November 25, 2016 at 1:07 am

      Got Baal?

      • Kent
        November 25, 2016 at 8:28 am

        Fun fact: the ancient Jews worshipped YHWH son of the god El of Isra”el” fame. Baal, literally Ba El was another son of El. Ba El literally mean “son of God”.

    • Kent
      November 25, 2016 at 8:38 am

      Petunia,

      The experience of heat is our bodies reaction to being in the presence of infra-red radiation. We experience it in the shade because the molecules around us release it in their interactions with us and each other. The atmospheres ability to absorb infrared radiation is functionally based upon the number of atoms in each molecule in the atmosphere. Most of the atmosphere is made up of 1 or 2 atom molecules like Nitrogen and Oxygen O2. Carbon Dioxide, Methane and water vapor all have three or more atoms. Therefore they have the capacity to hold more heat. That is just physics. Not something that is debated.

      And we are not all going to die tomorrow. If we are no longer able to grow crops in the abundant areas that we do so today, due to climate change, then many, many people may die at some point in the future. Except for the rich. That’s why you want to be rich.

      • hidflect
        November 26, 2016 at 1:16 am

        haha. This read like it was written by artificial intelligence.

    • Edward E
      November 26, 2016 at 7:34 am

      Ho hum, another day, another denier having hard landings…

      http://www.beautiful-yucatan-peninsula.com/image-files/spider-monkey-jumping.jpg

    • DanR
      November 26, 2016 at 9:41 am

      I think it is more cost effective to invest in property a bit inland or at higher elevation. Northern and eastern parts of the U.S. look better too. Ships are high maintenance and there seems to be too many around right now anyway.

  3. Dan Romig
    November 24, 2016 at 10:00 pm

    As Thanksgiving day closes out, I feel for all the people who’re losing their jobs in the shipbuilding industry.

    Typically, global trade works better in a smooth linear manner rather than a V-shaped one. Econ 101, if I recall, taught supply/demand equilibrium, eh?

  4. TedEdFred
    November 24, 2016 at 10:05 pm

    Ive said it before and Ill say it again….when you have legalized price fixing vis a vis the container shipping industry and you can’t make a profit there is a fundamental problem with the model and the management of the industry. These shipbuilders are obviously joined at the hip with these poorly run businesses and as the article points out many of these companies (just like container shipping) have and will continue to be bailed out by state subsidies. The natural selection process must be allowed to take place and let these non profitable players go bankrupt and let the chips fall. Also, the good Lord willing, we will see some of the manufacturing (be it robotic or not) return to our own country. I say its high time these companies get what they deserve……bankruptcy and a bit of the pain that we all go here in the USA.

  5. chris Hauser
    November 24, 2016 at 10:26 pm

    there are too many ships, and not enough finance, that’s why.

    great time to start a canal in nicaragua.

    whatever happened to the monroe doctrine?

    • IanCad
      November 25, 2016 at 4:46 am

      China’s stealing it.

    • MC
      November 25, 2016 at 9:29 am

      Ah, you mean the channel that has been priced at US $40 billion and whose inauguration has been set for 2019? I didn’t know Hong Kong financial groups were in the business of writing science fiction.

  6. nick kelly
    November 24, 2016 at 10:43 pm

    As I said in an earlier comment- given the tensions in the South China Sea- with China claiming territorial waters claimed by half a dozen other countries, military ships may be an answer for idle yards
    Of course ideally this would not be necessary, but….

    Nor does a flag- bearer have to fight- but even a patrol boat carries torpedoes.
    You need speed of course, and a PT boat armed only with machine guns has a useful fishing grounds, anti- smuggling, and police function, as well as showing the flag: “look, we’re here!”

    Moving up to the big dollar items are larger vessels, frigates and destroyers.
    There is an Aussie TV show about their coast guard or navy that is set aboard a very sweet looking vessel that I can only describe as a very big PT boat or a small destroyer.
    Take a very long look at licensing an existing design instead of from scratch. Design and that dread horde ‘consultants’ can eat up 20 % of the budget before a piece of steel is cut.

    Speaking of Aus and tensions- Aus has just ordered a fleet of submarines with French cooperation.
    A South Korean yard would be best to team up with an experienced defense contractor.

    • Lee
      November 25, 2016 at 12:46 am

      Well maybe…………

      Those subs may or may not be here until what was it 2050…………..

      Another Oz government joke.

  7. Frederick
    November 25, 2016 at 12:07 am

    Wont the “New Silk Road” project be bearish for shipbuilding as the countries od Asia and Europe ship more products by rail?

    • nick kelly
      November 25, 2016 at 1:00 pm

      By ship is far cheaper and can carry bigger loads.
      It would take many trains to move the load of a single large tanker or container ship.

      • Kent
        November 25, 2016 at 3:05 pm

        Yes, but the United States Navy becomes less of a concern.

      • Frederick
        November 26, 2016 at 1:11 pm

        Thats true but the trains will run on electricity instead of oil which can be reneweable and the time it takes is reduced by two thirds Also the pirating issue goes away and hence much lower insurance costs

  8. d
    November 25, 2016 at 12:24 am

    The chinese are going to keep it like this and keep piling on the state funded pressure until they are the only major shipbuilders and shippers in Asian.

    The only possible relief is an implosion of the chinese political and financial system, or war.

  9. nhz
    November 25, 2016 at 4:36 am

    My former neighbor worked for over 15 years as a manager for the construction of these ships all over the world, mainly in SE Asia. I was surprised how long his very well-paid job continued, despite years of stories about overcapacity and collapsing freight prices. Lately he has been looking for similar work in the offshore industry, and probably is thinking about retiring early ;-)

    As to the small European shipyards: I’m pretty sure all that growth is either fully government subsidized – like building warships – or ships for the 0.01%. My country is one of the top yacht builders and we have a major wharf nearby, that formerly build huge warships. They are now building the yachts for the international elite, some of them bigger than the average warship and priced at (way) over 1 million per meter length. Business for them clearly is booming, not a good sign if you ask me; basically the same one can see with trophy cars and trophy real estate.

    Fwiw, the business in small yachts (below $ 100K or so) doesn’t look healthy here, but the number of ships costing way over $ 1 million that visit our harbor has been rising strongly over the last 10 years. These are mostly from Netherlands and Belgium, clearly the 0.1% or so there is doing extremely well there too (or more willing to show off their wealth). The $100M+ super yachts are mostly for international buyers; I guess most of them head for the US or the Gulf area when finished.

    • MC
      November 25, 2016 at 7:34 am

      I suspect that growth is subsidized in other fashion: the largest cruise ship builder in Europe is Fincantieri of Italy, owned by the Italian government (71.6%), which also co-owns (with the French government) Les Chantiers de l’Atlantique of France, after STX was forced to sell all its European operations to raise cash which didn’t stop it from seeking court protection earlier this year.

      Much is said, and rightly so, about the highly suspect practices of Chinese shipbuilders but these two shipbuilders have long operated at cost or at loss just to keep the factory doors open. The bidding war for the RMS Queen Mary II back in the days was just the most public display of such dubious practices.

      It may interest you to know the Yantai CMC Raffles in China designed and operates the most impressive gantry crane in the world, the Taisun.
      While the crane itself is wholly of Chinese design, the hoist system was designed and built by Dutch crane specialist Huisman Equipment B.V.
      Leaving everything aside that crane is a true engineering masterpiece. If my grandfather was still alive he wouldn’t leave no stone unturned to go and see it in person.

      • nhz
        November 25, 2016 at 9:37 am

        I think such practices have been going on in many countries for a very long time.

        Building large ships involves lots of money and potential prestige which makes it attractive to politicians and all kind of other dubious personalities. In my country over the last century or so the building of warships was often an “unemployment project”. What does the Dutch navy need those huge warships for nowadays, except escorting thousands of refugees from African shores to Europe or nagging Russia??

  10. Ed
    November 25, 2016 at 11:51 am

    China has developed an economy to just build stuff to keep billions of people busy. Markets are clearly not a factor in their decision making in much of this.

  11. OutLookingIn
    November 25, 2016 at 12:07 pm

    Just not Asia to suffer shipping losses.

    Bremer Landesbank has been totally taken over by NordLB Bank, which is now Germanys second largest shipping lender.
    Their combined shipping loan book is now 40% distressed with non-performing loans. Losses will be in the billions of euros.

    http://www.zerohedge.com/news/2016-11-24/germanys-second-largest-shipping-lender-40-our-shipping-loan-book-non-performing

    • MC
      November 26, 2016 at 2:32 am

      Nothing to worry about: the German taxpayer stands at the ready to bail them out.
      They’ve already done that time and time again and the pattern is such that the much feared “bail-in” rule does not apply: as Landesbanken and most Sparkassen are wholly or majority owned by local governments, once toxic assets reach a certain weight they are transferred on the owners’ books.
      Pretty much every Lander from Bavaria to Schleswig-Holstein has hundreds of millions of NPL’s and other dubious financial assets on books. And while the City of Bremen has been taking things to the next level, there are dozens of cities, big and small, across Germany whose balance sheets are weighed down by assets unloaded from the local bank.

      Now: this is nothing compared to Deutsche Bank’s opaque mass of purely financial liabilities and Italy’s dormant volcano of degraded, housing-derived and backed loans, but as ironically many members of the Merkel Cabinet (including the chancellor herself) have said “Our strength is not infinite”. And it isn’t.

  12. Edward E
    November 25, 2016 at 12:22 pm

    The Harpex index has stopped going down for now. Our truckers are running really hard. Rail has even picked up a bit. Looks like there would have to be at least a little bounce coming for carriers.

    • Frederick
      November 26, 2016 at 1:13 pm

      Have you taken a look at the Dryships stock price recently Not a pretty picture of confidence thats for sure

      • Edward E
        November 27, 2016 at 1:28 pm

        There’s some confusion about Trump card and his war on trade rhetoric. He’ll probably actually boost trade and predator agreements under different names. His brother at the church of the ‘Stripper Bandits’ is smelling money.
        https://ourfuture.org/20161121/why-we-need-to-worry-about-wilbur

      • Edward E
        November 27, 2016 at 1:40 pm

        Then there’s the plans for worldwide infrastructure spending, that’s great for shipping. The prices for copper, nickel, lead and zinc are going up in anticipation.

        Unfortunately for us over here, his infrastructure plans are likely a privatization scam.

  13. Chicken
    November 27, 2016 at 1:03 am

    And we’re supposed to believe here’s another giant mess that was a result of stupidity, not deceit? I wish people would wake the heck up.

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