“Freight rates for dry-bulk and container ships, carriers of most of the world’s raw materials and finished goods, have plunged over the last six months in the latest sign the global economy is slowing significantly.
“The Baltic Dry Index, measure of ship transport costs for materials like iron ore and coal, has fallen by 47 percent since mid-2018, when a trade dispute between the United States and China resulted in the world’s two biggest economies slapping import tariffs on each other’s goods.
“Dry-bulk commodities are taken as a leading economic indicator, because they are used in core industrial sectors like steelmaking and power generation, and analysts say the recent declines in activity point to a serious economic slowdown.”
“”The global economy and dry-bulk shipping market are showing us very real signs of distress,” said Jeffrey Landsberg, managing director of commodity consultancy Commodore Research.”
https://www.euronews.com/2019/01/25/global-shipping-rates-slump-in-latest-sign-of-economic-slowdown
“Britain is preparing for Brexit in little over two months against a backdrop of faltering domestic growth and a global economic slowdown, which threatens to compound the consequences of a no-deal exit, according to Guardian analysis of economic news over the past month.
“UK plc has begun to enact emergency plans for crashing out of the EU, with Westminster gridlocked since Theresa May suffered the worst government defeat of any British PM in the democratic era over her withdrawal plan.”
“Spending by UK households has surged to a 13-year high as increases in transport and housing costs and higher food bills took their toll, according to the latest official snapshot of family spending…
“The data prompted concern among some commentators that some families could be left financially vulnerable.”
https://www.theguardian.com/business/2019/jan/24/spending-by-uk-households-rises-to-13-year-high
“The European Central Bank has sounded the alarm over the euro-zone economy, warning a slowdown it thought would be temporary was showing signs of becoming long-lasting because of global trade tensions, Brexit and financial market volatility.
“The shift in outlook, which policymakers said had clearly “moved to the downside”, comes just six weeks after the ECB removed the most important element of its crisis-era stimulus, halting new purchases of bonds as part of its €2.6 trillion quantitative easing programme.”
“As China’s car industry loses its shine, automakers are starting to buckle up for the downward slope with Hyundai Motor Co. announcing it’s letting workers go and is reviewing production plans in the world’s biggest market.
“Beijing Hyundai Motor Co., the joint venture between Hyundai and BAIC Motor Corp., is accepting voluntary retirements from employees and reviewing “production optimization” to enhance plant efficiency around the Chinese New Year holidays, Hyundai said in a text message Friday.”
“Rising interest rates and the latest round of property curbs have put the brakes on mortgage demand at Singapore’s banks, potentially further dragging down the city’s housing market…
“The credit slowdown threatens to further accelerate the decline in residential prices… Housing values may drop as much as 3 per cent this year, and new home sales might plunge 20 per cent, according to Mr Derek Tan, a real estate analyst at DBS Group Holdings.”
https://www.straitstimes.com/business/property/singapore-seeing-unprecedented-mortgage-slowdown
“President Donald Trump’s political plight gets worse with every day that passes in history’s longest government shutdown. Yet at a moment when a conventional president would fold a bad hand and spare the federal workers victimized by the debacle, Trump is digging ever deeper.
“And the most foreboding sign emerging from Capitol Hill on the 35th day of the impasse is that no one — not his Republican allies or Democratic foes — has any idea how he plans to extricate the nation from the darkening crisis.”
https://edition.cnn.com/2019/01/25/politics/donald-trump-wall-shutdown-congress/index.html
“…two weeks after being sworn in, the anointed successor of the late socialist firebrand Hugo Chavez is facing the biggest challenge to his turbulent political career.
“A relative newcomer, opposition leader Juan Guaido, this week declared himself Venezuela’s acting president on a day of massive anti-government protests.”
https://edition.cnn.com/2019/01/24/americas/venezuela-crisis-maduro-guaido-explained/index.html
“The Crisis in Zimbabwe Coalition on Thursday warned of “greater chances of escalation of social unrest and instability” if the volatility in that country was not adequately addressed.
“Addressing journalists in Johannesburg, the coalition’s regional coordinator – Blessing Vava – said while there was a national outcry over the deteriorating economic situation in Zimbabwe, there was also an apparent attempt by the state to silence dissenting voices through arbitrary arrests, beatings, abductions and threatening civil society leaders and unionists.”
https://www.iol.co.za/news/africa/zimbabwes-crisis-could-further-degenerate-civil-society-18954522
“Central banks are fast losing their chance to tighten before the next downturn in the cycle, though it’s still unclear what the Federal Reserve’s “patience” means for interest-rate hikes this year. Ray Dalio’s leading a crowd calling for a rethink on policy tightening amid all the weak growth signs.”
“Investors in the kinds of corporate debt that former Fed Chair Janet Yellen warned about a month ago have never been more exposed, according to Moody’s Investors Service.
“Covenant quality, or the protections lenders get, reached a historic low in the third quarter, the most recent period for which data are available, according to an indicator the ratings agency uses.”
https://www.cnbc.com/2019/01/24/investor-protection-for-leveraged-loans-never-lower-moodys-says.html
Read the previous ‘Economy’ thread here and visit my Patreon page here.
