A “Perfect Storm Is Coming” Deutsche Warns As Baltic Dry Falls To New Record Low
- A “Perfect Storm Is Coming” Deutsche Warns As Baltic Dry Falls To New Record Low
by Tyler Durden, www.zerohedge.com
Following disappointing China PMI data and a collapse in US ISM Manufacturing imports data, the fact that The Baltic Dry Index has collapsed to fresh record lows will hardly be a surprise to many. However,as Deutsche Bank warns, a “perfect storm” is brewing in the dry bulk industry, as year-end improvements in rates failed to materialize, which indicates a looming surge in bankruptcies.
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At 468, The Baltic Dry Index is now at a new record low…
And US Manufacturing imports suggest things are getting worse, not better…
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Which leads Deutsche Bank to warn of…A Perfect Storm Brewing:
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The improvement in dry bulk rates we expected into year-end has not materialized. And based on conversations we’ve had with several industry contacts, we believe a number of dry bulk companies are contemplating asset sales to raise liquidity, lower daily cash burn, and reduce capital commitments. The glut of “for sale” tonnage has negative implications for asset and equity values.
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