Forget everyone who's been talking about when the recovery'll start; we're just about to take the big dive....
Wonks everywhere have been panicking about the Baltic Dry Index, which represents the amount of good being shipped in containers over the seas. As this article mentions, global orders are down precipitously (Volvo's YoY truck orders are down 99.6% from 41,970 to 155!). With no-one buying goods, who needs employees? Retail's gonna get creamed; demand for short-term commercial loans will skyrocket to cover the fact that no-one's buying, and demand for retail loans will plummet. Visa(V) has already taken it in the proverbial shorts (pun intended), but all those banks who've been using the projected proceeds from usurious lending rates will find themselves in deem kim-chee.
Pension funds are also in big trouble:1,2,3,4,5,6, and CalPERS, for locals.
Like I said, hang onto your hats, 'cuz it's gonna be scary.
Friday, October 31, 2008
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