Rising Yen, Collapsing SIV's, Tankers & Hives
Collapsing Super SIV?... Deutsche Bank AG, Credit Suisse Group and other members of the Institute of International Finance...
stopped short of endorsing an $80 billion plan supported by the U.S. Treasury to revive the commercial paper market.
Stephen Green, chairman of HSBC Holdings:
"If it comes to fruition, we'll clearly have to think about whether to participate. It's too early to tell whether it's helping restore confidence."
Alan Greenspan, an adviser to Deutsche Bank: "It's not clear to me that the benefits exceed the risks."
Market Collapse?? The Nikkei is down 2.5% early this morning, the yen went to a six week high from 114.53 to 113.41 vs US Dollar.
The yen also went to a 3 week high vs Euro and 4 week high vs New Zealand & Australian dollar.
A clear sign the carry traders are unwinding in mass as investors sell riskier assets bought with loans in Japan.
We could see BLACK MONDAY, depends on how it plays out by COB and what Europe does. Oh boy....
at least PG is still up there, watch it cuz when it starts sinking, then everything will tank.
Collapsing Oil Tankers?... Bloombergs coverage points out that the oil tankers may, but not the dry bulk shippers...
The record increase in oil prices and the unprecedented number of new tankers transporting crude is a stock market crash waiting to happen.
The size of the oil tanker fleet expanded 3.8% this year, overwhelming the 1.7% increase in crude oil demand.
Tankers are being built at the fastest rate ever. The fleet will increase by as much as 32% during the next five years.
Shares of Frontline are heading for an 11% decline, according to Henrik With, the DnB Nor Markets analyst whose advice on Frontline gave clients a 91% gain in the past year.
Teekay may decline 26%, he forecasts. Among all analysts tracked by Bloomberg, at least 70% say the two stocks aren't worth buying.
DnB Nor Markets' With:
"Asset values will fall and dividend payments must be cut. Too much fleet capacity coming on stream will put pressure on earnings from 2008 to 2010."
According to Citigroup, falling freight rates and record fuel costs have given shipowners their longest string of losses in five years.
Shipowners are spending more on fuel and debt payments than they collect in rent. Some 50 supertankers have failed to find cargoes in the past month.
On the other hand, China's economy is growing at almost 12% a year and India's by 9.3%, spurring demand for oil, steel, iron ore and coal.
Frontline CEO Bjoern Sjaastad said oil carriers will be sold and converted to haul bulk commodities, easing the ship surplus.
Thirty of the largest tankers may be sold and converted into carriers for grain, coal and iron ore, markets where freight rates are at a record high.
Also, the speed of demolitions on older ships "will go a lot faster than many people think," bolstering freight rates.
Omar Nokta, at Dahlman Rose: "For the next 15 months, there isn't going to be substantial additions to the fleet, you'll have depletions going to dry bulk.
If you have the demand push, then they'll be able to absorb the vessels. Demand would keep a natural floor."
Collapsing Colonies continued... excellent coverage on Bloomberg of the USDA's efforts in the CCD (Colony Collapse Disorder) crisis...
Jim Cane a USDA researcher:
"If honeybees disappeared tomorrow we'd be in a world of hurt. Further colony collapse would bankrupt a lot of farmers and make a big hole in some state budgets."
The syndrome, in which bees abandon their hives and die, has been found in at least 35 states, a Canadian province and parts of Europe, Asia and South America.
The collapse hurt a quarter of U.S. beekeepers, wiping out 45% of their bees on average.
Crop pollination may reach a crisis in the next several years, leading to higher food prices.
33% of all global food production requires pollinators as there are no technlogical substitutes.
The Agriculture Department estimated in June that colony collapse may cause as much as $75 billion in losses to the agriculture industry and U.S. economy.
stopped short of endorsing an $80 billion plan supported by the U.S. Treasury to revive the commercial paper market.
Stephen Green, chairman of HSBC Holdings:
"If it comes to fruition, we'll clearly have to think about whether to participate. It's too early to tell whether it's helping restore confidence."
Alan Greenspan, an adviser to Deutsche Bank: "It's not clear to me that the benefits exceed the risks."
Market Collapse?? The Nikkei is down 2.5% early this morning, the yen went to a six week high from 114.53 to 113.41 vs US Dollar.
The yen also went to a 3 week high vs Euro and 4 week high vs New Zealand & Australian dollar.
A clear sign the carry traders are unwinding in mass as investors sell riskier assets bought with loans in Japan.
We could see BLACK MONDAY, depends on how it plays out by COB and what Europe does. Oh boy....
at least PG is still up there, watch it cuz when it starts sinking, then everything will tank.
Collapsing Oil Tankers?... Bloombergs coverage points out that the oil tankers may, but not the dry bulk shippers...
The record increase in oil prices and the unprecedented number of new tankers transporting crude is a stock market crash waiting to happen.
The size of the oil tanker fleet expanded 3.8% this year, overwhelming the 1.7% increase in crude oil demand.
Tankers are being built at the fastest rate ever. The fleet will increase by as much as 32% during the next five years.
Shares of Frontline are heading for an 11% decline, according to Henrik With, the DnB Nor Markets analyst whose advice on Frontline gave clients a 91% gain in the past year.
Teekay may decline 26%, he forecasts. Among all analysts tracked by Bloomberg, at least 70% say the two stocks aren't worth buying.
DnB Nor Markets' With:
"Asset values will fall and dividend payments must be cut. Too much fleet capacity coming on stream will put pressure on earnings from 2008 to 2010."
According to Citigroup, falling freight rates and record fuel costs have given shipowners their longest string of losses in five years.
Shipowners are spending more on fuel and debt payments than they collect in rent. Some 50 supertankers have failed to find cargoes in the past month.
On the other hand, China's economy is growing at almost 12% a year and India's by 9.3%, spurring demand for oil, steel, iron ore and coal.
Frontline CEO Bjoern Sjaastad said oil carriers will be sold and converted to haul bulk commodities, easing the ship surplus.
Thirty of the largest tankers may be sold and converted into carriers for grain, coal and iron ore, markets where freight rates are at a record high.
Also, the speed of demolitions on older ships "will go a lot faster than many people think," bolstering freight rates.
Omar Nokta, at Dahlman Rose: "For the next 15 months, there isn't going to be substantial additions to the fleet, you'll have depletions going to dry bulk.
If you have the demand push, then they'll be able to absorb the vessels. Demand would keep a natural floor."
Collapsing Colonies continued... excellent coverage on Bloomberg of the USDA's efforts in the CCD (Colony Collapse Disorder) crisis...
Jim Cane a USDA researcher:
"If honeybees disappeared tomorrow we'd be in a world of hurt. Further colony collapse would bankrupt a lot of farmers and make a big hole in some state budgets."
The syndrome, in which bees abandon their hives and die, has been found in at least 35 states, a Canadian province and parts of Europe, Asia and South America.
The collapse hurt a quarter of U.S. beekeepers, wiping out 45% of their bees on average.
Crop pollination may reach a crisis in the next several years, leading to higher food prices.
33% of all global food production requires pollinators as there are no technlogical substitutes.
The Agriculture Department estimated in June that colony collapse may cause as much as $75 billion in losses to the agriculture industry and U.S. economy.
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