{"id":30123,"date":"2015-03-11T11:06:17","date_gmt":"2015-03-11T15:06:17","guid":{"rendered":"http:\/\/www.technologyinvestor.com\/?p=30123"},"modified":"2015-03-11T11:06:17","modified_gmt":"2015-03-11T15:06:17","slug":"what-we-know-some-charts-hanging-in","status":"publish","type":"post","link":"https:\/\/www.technologyinvestor.com\/?p=30123","title":{"rendered":"What we know. Some charts. Hanging in."},"content":{"rendered":"<p style=\"text-align: left;\">From the Economist:<\/p>\n<p style=\"text-align: left; padding-left: 30px;\">There is no doubt that world trade is slowing down. China\u2019s\u00a0rip-roaring economy, the destination for well over half the world\u2019s\u00a0ship-borne iron ore and 25% of coal, has cooled. It grew by 7.4% last\u00a0year compared to well over 10% when running at full tilt.<\/p>\n<p style=\"text-align: left;\"><a href=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/RunningAground.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-30125\" src=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/RunningAground.jpg\" alt=\"RunningAground\" width=\"366\" height=\"356\" srcset=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/RunningAground.jpg 366w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/RunningAground-300x291.jpg 300w\" sizes=\"auto, (max-width: 366px) 100vw, 366px\" \/><\/a> <a href=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/Sunk.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-30126\" src=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/Sunk.jpg\" alt=\"Sunk\" width=\"364\" height=\"366\" srcset=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/Sunk.jpg 364w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/Sunk-150x150.jpg 150w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/Sunk-298x300.jpg 298w\" sizes=\"auto, (max-width: 364px) 100vw, 364px\" \/><\/a><\/p>\n<p style=\"text-align: left;\">Europe&#8217;s economy is slow, reflected in its Euro. The Euro seems headed for parity with the dollar. (It&#8217;s been there before.)<\/p>\n<p style=\"text-align: left;\"><a href=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/ONeEuro.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-30127\" src=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/ONeEuro.jpg\" alt=\"ONeEuro\" width=\"603\" height=\"393\" srcset=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/ONeEuro.jpg 603w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/ONeEuro-300x195.jpg 300w\" sizes=\"auto, (max-width: 603px) 100vw, 603px\" \/><\/a><\/p>\n<p style=\"text-align: left;\">Meantime oil stays weak. Click on the different time frames. Fascinating stuff.<\/p>\n<p style=\"text-align: left;\"><script src=\"https:\/\/www.oil-price.net\/TABLE2\/gen.php?lang=en\">\/\/ <![CDATA[\n\n\n\/\/ ]]><\/script><\/p>\n<p style=\"text-align: left;\">The market is flat, apparently confused. Here&#8217;s this year:<\/p>\n<p style=\"text-align: left;\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-30130\" src=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/SPthis-Year.jpg\" alt=\"S&amp;Pthis Year\" width=\"652\" height=\"347\" srcset=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/SPthis-Year.jpg 652w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/SPthis-Year-300x159.jpg 300w\" sizes=\"auto, (max-width: 652px) 100vw, 652px\" \/><\/p>\n<p style=\"text-align: left;\">A pause after a huge six-year run. (The bottom in this chart was March 2009.)<\/p>\n<p style=\"text-align: left;\"><a href=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/SPOverTenYears.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-30129\" src=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/SPOverTenYears.jpg\" alt=\"S&amp;POverTenYears\" width=\"646\" height=\"355\" srcset=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/SPOverTenYears.jpg 646w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/SPOverTenYears-300x164.jpg 300w\" sizes=\"auto, (max-width: 646px) 100vw, 646px\" \/><\/a><\/p>\n<p style=\"text-align: left;\">There is talk of our Fed raising interest rates soon, though overseas they&#8217;re coming down.<\/p>\n<p style=\"text-align: left;\">Apple stock reacted badly to new Apple products. (Not good for me, since I have a heavy Apple position.)<\/p>\n<p style=\"text-align: left;\"><a href=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/AppleThisYearAgain.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-30131\" src=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/AppleThisYearAgain.jpg\" alt=\"AppleThisYearAgain\" width=\"641\" height=\"342\" srcset=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/AppleThisYearAgain.jpg 641w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/AppleThisYearAgain-300x160.jpg 300w\" sizes=\"auto, (max-width: 641px) 100vw, 641px\" \/><\/a><\/p>\n<p style=\"text-align: left;\">The world is not collapsing. It seems to be pausing. The Economist writes:<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">But although\u00a0the world economy is quite weak it is far away from the apocalypse\u00a0that the index apparently foretells. The reason that the BDI (Baltic Dry Index &#8212; see above) has taken such a precipitous dive is that it is a measure both of\u00a0demand for shipping and of the supply of vessels. Sliding charter\u00a0rates are more a reflection of the eternal optimism of shipowners\u00a0than a calamitous foundering of the world economy. &#8230;<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">The current malaise is much more a result of the overall supply of\u00a0ships than a harbinger of doom for the world economy. In the run up to\u00a0the financial crisis, as the world economy boomed and rates hit new\u00a0heights, shipowners ordered a huge tonnage of bulk carriers. These\u00a0hit the waves during the post-crisis slump that was already weighing\u00a0heavily on demand for ships, which pushed charter rates lower still.\u00a0Just as scrapping and a slimming of the order book was eroding the\u00a0oversupply of ships, an uptick in Chinese coal imports in 2013\u00a0prompted another rash of orders. Ship owners reckoned that China\u2019s\u00a0appetite for coal would keep growing. But the country\u2019s policy of\u00a0weaning itself off dirty energy has contributed to a rapid decline in imports,\u00a0leaving another glut of new vessels and rock-bottom rates for their\u00a0owners.<\/p>\n<p style=\"text-align: left;\">Downturn in oil, now under $50,\u00a0 has hurt oil companies:<\/p>\n<p style=\"text-align: left;\"><a href=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/RIGOneYear.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-30132\" src=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/RIGOneYear.jpg\" alt=\"RIGOneYear\" width=\"645\" height=\"353\" srcset=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/RIGOneYear.jpg 645w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/RIGOneYear-300x164.jpg 300w\" sizes=\"auto, (max-width: 645px) 100vw, 645px\" \/><\/a><\/p>\n<p style=\"text-align: left;\"><a href=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/HALONeYear2.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-30134\" src=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/HALONeYear2.jpg\" alt=\"HALONeYear2\" width=\"638\" height=\"360\" srcset=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/HALONeYear2.jpg 638w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/HALONeYear2-300x169.jpg 300w\" sizes=\"auto, (max-width: 638px) 100vw, 638px\" \/><\/a><\/p>\n<p style=\"text-align: left;\">It&#8217;s good to keep away from obvious disasters. Oil has been one.<\/p>\n<p style=\"text-align: left;\">The Economist writes:<\/p>\n<div class=\"main-content\">\n<p style=\"padding-left: 30px; text-align: left;\">THE latest non-farm payrolls &#8212; 295,000 jobs were added in February, while the unemployment rate fell to 5.5% &#8212; will reassure investors about the health of the US economy, while simultaneously provoking concerns about the likely date of the first Federal Reserve rate increase.<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">But what about the global economy? There are four things that might give investors pause. The first is the direction of central bank policy. The Fed might be thinking of pushing up rates but many more central banks have been cutting; India and Poland were the latest to join the trend. That doesn&#8217;t suggest confidence in a global recovery. The second is bond yields. Euro zone 10-year yields are now on a par with their Japanese equivalents at 0.38%; the US has the highest yields in the G7 at 2.2%. Of course, one can argue that these yields have been manipulated by central banks, although both the Fed and the Bank of England reduced or stopped QE a while ago. The third and fourth measures are commodity prices and the Baltic Dry index, a measure of shipping rates (see chart, which is on a log scale). Both dipped in 2008-2009 and recently but the Baltic Dry&#8217;s decline is much more precipitous; it recently hit a 30-year low.<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">One would expect there to be some kind of link between the two. After all, commodities are exactly the kind of product &#8211; bulky, imperishable &#8211; that companies are going to send by ship. And these indices are, of course, driven by the balance of supply and demand. Commodity markets operate with a lag &#8211; it takes time to develop new oil fields and dig new mines &#8211; so the risk is that the price may have dropped by the time the extra supply comes on stream. Shipping operates with an extra lag since shipowners respond to higher commodity demand. <span style=\"color: #000000;\">New ship orders more than trebled between 2012 and 2013. <\/span>But it may not be just supply that is to blame; the WTO has been cutting its forecasts for world trade growth.<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">The head of Maersk, the shipping group, recently talked of <a href=\"http:\/\/www.ft.com\/cms\/s\/0\/c1a51f64-be8e-11e4-a341-00144feab7de.html#axzz3TcDXUPmZ\">slower global trade growth<\/a>, adding that<\/p>\n<blockquote style=\"padding-left: 30px;\">\n<p style=\"padding-left: 30px;\">The economies in Europe are still very sluggish. Brazil, Russia and China: those three economies used to drive a lot of growth, and right now we are not really seeing that to the same extent. The only real bright spot is the US, and even the US is good but not great<\/p>\n<\/blockquote>\n<p style=\"padding-left: 30px; text-align: left;\">One should be pretty cautious about overinterpreting the Baltic Dry&#8217;s movements; its sheer volatility over the long term suggests it can hardly be an exact forecaster of the economy. In some respects, its fall may even be good news, as <a href=\"http:\/\/www.forbes.com\/sites\/timworstall\/2015\/02\/05\/why-you-shouldnt-worry-about-the-baltic-dry-index-hitting-a-29-year-low\/\">some commenters point out<\/a>. However the index&#8217;s slump hardly suggests a boom either. And another bellwether is <span style=\"color: #000000;\">Korean exports<\/span> which fell 3.4% year on year in February (although seasonal factors played their part).<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">The big question is whether lower oil prices and interest rate cuts will eventually act to give the economy a second wind, or whether both developments are merely a symbol of incipient weakness. The equity markets clearly favour the benign interpretation, and indeed one can partly explain rate-cutting and low bond yields with respect to the effect of falling commodity prices on inflation. As always, we need more data; first quarter GDP numbers from the emerging markets (out next month) will be the next test.<\/p>\n<p style=\"text-align: left;\">VectorVest this morning gave the market a &#8220;<strong>confirmed down signal.<\/strong>&#8221; They are often right.<\/p>\n<p style=\"text-align: left;\">For me, I&#8217;m hanging in.<\/p>\n<p style=\"text-align: left;\">The irony is that some of my private investments have suddenly paid off, a little. I guess that&#8217;s what diversification&#8217;s attraction is meant to be.<\/p>\n<p style=\"text-align: left;\"><span style=\"color: #0000ff;\"><strong>Favorite two latest New Yorker cartoons.<\/strong><\/span><\/p>\n<p style=\"text-align: left;\"><a href=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/chickenandbacon.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-30136\" src=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/chickenandbacon.jpg\" alt=\"chickenandbacon\" width=\"523\" height=\"519\" srcset=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/chickenandbacon.jpg 523w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/chickenandbacon-150x150.jpg 150w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/chickenandbacon-300x297.jpg 300w\" sizes=\"auto, (max-width: 523px) 100vw, 523px\" \/><\/a><\/p>\n<p style=\"text-align: left;\"><a href=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/Notechnology.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-30137\" src=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/Notechnology.jpg\" alt=\"Notechnology\" width=\"403\" height=\"499\" srcset=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/Notechnology.jpg 403w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2015\/03\/Notechnology-242x300.jpg 242w\" sizes=\"auto, (max-width: 403px) 100vw, 403px\" \/><\/a><\/p>\n<p style=\"text-align: left;\"><a href=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2013\/07\/HarryNewton.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-21218\" src=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2013\/07\/HarryNewton.jpg\" alt=\"HarryNewton\" width=\"200\" height=\"199\" srcset=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2013\/07\/HarryNewton.jpg 200w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2013\/07\/HarryNewton-150x150.jpg 150w\" sizes=\"auto, (max-width: 200px) 100vw, 200px\" \/><\/a><br \/>\nHarry Newton who is eyeing even more dental work. Lesson: Get your dentist to do a full mouth x-ray every two years. Then have him eye incipient problems. There&#8217;s stuff that can be fixed before it gets to my level of disaster. All day tomorrow in his chair. Now, that&#8217;s something to look forward to.<\/p>\n<p><script>\/\/ <![CDATA[\n(function(i,s,o,g,r,a,m){i['GoogleAnalyticsObject']=r;i[r]=i[r]||function(){\n  (i[r].q=i[r].q||[]).push(arguments)},i[r].l=1*new Date();a=s.createElement(o),\n  m=s.getElementsByTagName(o)[0];a.async=1;a.src=g;m.parentNode.insertBefore(a,m)\n  })(window,document,'script','\/\/www.google-analytics.com\/analytics.js','ga');\n\n  ga('create', 'UA-45200733-1', 'technologyinvestor.com');\n  ga('send', 'pageview');\n\/\/ ]]><\/script><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>From the Economist: There is no doubt that world trade is slowing down. China\u2019s\u00a0rip-roaring economy, the destination for well over half the world\u2019s\u00a0ship-borne iron ore and 25% of coal, has cooled. It grew by 7.4% last\u00a0year compared to well over 10% when running at full tilt. Europe&#8217;s economy is slow, reflected in its Euro. The [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-30123","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/posts\/30123","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=30123"}],"version-history":[{"count":0,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/posts\/30123\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=30123"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=30123"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=30123"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}