Strong indicator of vanishing international trade

This very short article explains it in layman's terms. The Baltic Dry Index, a measure of how much freight is moving in cargo chips has gone negative. That means that shipping companies will pay shippers to move freight through their ships. The reasons is that cargo ships (just like refineries) are very expensive and complex, and if they are not used or maintained they deteriorate quickly.

This is an amazing commentary on what is happening to globalized trade... it's vanishing. -- MCR

Shipping Rates Go... Negative

Zero Hedge,

6 Febraury, 2012

Following the endless collapse in the Baltic Dry, it was only a matter of time before the shipping industry one-upped the Chairsatan, and was the first to introduce, dum dum dum, negative rates

That's right: you are now paid to hire a ship. Via Bloomberg:

• GLENCORE HIRES SHIP AT MINUS $2,000 A DAY, GMI SAYS

• GMI TO CONTRIBUTE $2,000 A DAY TO GLENCORE'S FUEL COSTS

• GLOBAL MARITIME'S U.K. MD STEVE RODLEY CONFIRMS DEAL BY PHONE

Why is this happening? 

Perhaps because ships have to be kept seaworthy and in motion or else they become scrappage in as little time as 3 months. 

Think sharks. Needless to say, this will play havoc with shipping company (and affiliated entities') liquidity, as the biggest default wave in the history of the industry is about to be unleashed and tens if not hundreds of billions of European secured loans are about to be "impaired."