Baltic Dry Index = 0 ships at sea?!

[GRG55]

Re: Baltic Dry Index = 0 ships at sea?!

Mike, I've been following this and the problem is not the U.S (directly).
The Word Trade Federation is protecting companies who can't sell their food when customers know where it comes from.

The recent WTF ruling against the U.S. was started by beef companies in Mexico and Canada.
People in the US prefer beef from the U.S., and those two nations filed a complaint that was enforced.

The theory is that when product labels show honest and important information, and that info discourage sales from some places, then the honest truth must be removed from the labels.
Now the customer can't know the truth, and so some people will accidentally purchase a product they would rather avoid.

Apparently that is now considered good fair trade policy - hiding information that people use to make purchasing decisions.

P.S.
Am I the only person that finds it hilarious that the acronym for the World Trade Federation is "WTF"?

First, as I understand it's the World Trade Organisation (WTO), not WTF.

Second, this was nothing more than another example of a thinly disguised protectionist move for US producers. The USA Department of Commerce is the closest thing to legalized thuggery.

If Canada had insisted on exactly the same country of origin labelling of all the food that is imported from the USA (and it's a LOT), the US government would have been screaming holy terror and sending the Marines.

The USA is part of a trade agreement zone. Abide by the rules. If you don't like the rules then negotiate to change them. But until they are agreed to be changed abide by the rules that were agreed by all parties when the agreements were struck.

The USA is the first to complain when contract law is broken by others. And the first to try to break it itself, because it thinks it has the heft and size to steamroll everyone else. I am not an anti-American. Quite the opposite, as anyone who has been around this forum for a while will know, but this, and its unilateral declarations of war followed by dropping bombs on foreign civilians, are the two consistent behaviours that I find abhorrent about the U.S. of Eh.

Edit added: Just a clarification. What Canada did was specifically ask the WTO to exempt it under its international trade obligations and allow it to put tariffs on the imports of USA produced fruits, vegetables, grains, prepared foods, liquor, wine and a number of other items. It was only the threat these USA products would be priced out of its closest export market that caused it to reconsider.

[touchring]

Re: Baltic Dry Index = 0 ships at sea?!

Funny. As a Canadian I live by the same rule re:Chinese food, but I also have a rule#2: Where possible, avoid eating any food from the USA. The amount of hormones and pesticides and crap you guys allow your corporations to put into some of your foods is frightnening, to say nothing of the moral compass of the giant Monsanto. Lastly, I also keep in mind the carbon impact of buying local vs importing from California (or South America for that matter).

+1

I avoid food made in China & Japan (ties with China due to Fukushimaya), and then followed by Taiwan & USA.

If you look at the ingredients of processed foods and stuff like cereals made by big corporations, a lot of them are sourced from China. They don't list the source of ingredients but if it's from a big corporation, you can bet that it's from the cheapest source and purchased in bulk.

My top choice is organic NZ produce, followed by Australia, Korea and then the food producing EU countries like Greece, Spain, Italy.

[GRG55]

Re: Baltic Dry Index = 0 ships at sea?!

Bingo!

Massive credit fuelled capital mis-allocation on a scale so grand that now it has finally exhausted it is influencing the entire global supply chain (supply to China as well as what China supplies to the ROW such as steel), and endangering entire nations that became overdependent on China for both market and funding (the "B" in BRICS comes immediately to mind).

For at least a half-decade it was obvious to anyone watching without swallowing the propaganda Kool-Aid that China's economic model was simply unsustainable...

...The nation that is going to most benefit from China's insanity is the nation China was allegedly going to "crush". The people I speak to that are the most down on the USA economic prospects are Americans themselves. Clearly the rest of the world doesn't agree given what they are prepared to bid for the USA's currency and the USA's companies.

A Towering Chinese Debt Mountain Looms Over Markets

January 14, 2016 — 5:24 PM MST

Lost in all the Chinese stock and currency market gyrations, policy missteps and mixed data is this economic reality: The government is constrained by a credit bubble that has ballooned to $28 trillion in an economy growing at its slowest pace in 25 years...

...China has appeared to backtrack on pledges to make its management of the yuan more market driven and there’s uncertainty over the government’s willingness to remove stock price supports imposed during a $5 trillion sell-off last summer...

...Against that backdrop, Chinese officialdom faces the high-wire act of trying to keep the economy growing rapidly enough to repay past obligations, without resorting to a fresh pick-up in debt to fund more stimulus. It was China’s reliance on credit-fueled growth in the wake of the 2008 global financial crisis that resulted in one of the biggest debt expansions in recent history, and today’s hangover.

"China is nowhere close to reining in its debt problems," said Charlene Chu, the former Fitch Ratings Ltd. analyst known for her warnings over China’s debt risks and now a partner of Autonomous Research Asia Ltd. "It is one of the key factors weighing on GDP growth and one of the reasons why foreign investors are so concerned about China’s trajectory."...

...The meddling has proved largely ineffective and often counterproductive: Leaders had to abandon a newly imposed stock circuit-breaker system introduced on Jan. 4 after price plunges cut short trading sessions twice last week. Even as regulators tried to calm sentiment, the People’s Bank of China surprised traders as it weakened the yuan the most since August by cutting the currency’s daily reference rate against the dollar.

Meantime, the central bank has been spending hundreds of billions to offset massive capital outflows and support the yuan. Its stockpile of foreign exchange reserves plunged by $513 billion in 2015 to $3.33 trillion...

...When authorities last year lifted a ceiling on bank deposits to allow freer pricing, they followed up with guidance to banks not to use too much of their new-found freedom, showing the tension between reform and control...

...The Communist Party is unlikely to relinquish its control over economic matters any time soon, said Chen Zhiwu, who sits on the International Advisory Board of the China Securities Regulatory Commission (CSRC), the nation’s stock market regulator. "It’s that misunderstanding that goes to the heart of China’s dilemma," the Yale University academic said...

...There’s also been no real progress in chipping away at the debt burden, supercharged by spending on infrastructure and housing, that delivered average economic growth of 10 percent over the past 30 years. Government, corporate, and household borrowing totaled $28 trillion as of mid-2014, or about 282 percent of the country’s GDP at the time, according to McKinsey & Co. ..

The Chinese Are Converting Their Cash to U.S. Dollars

January 14, 2016 — 2:00 PM MST

...The risk for the central bank is that households’ currency stashes may join outflows of capital that threaten to destabilize the economy as businesses and individuals bet against the yuan, which is forecast to further devalue this year.

More than $840 billion exited China in the first 11 months of last year in an unprecedented exodus, according to a Bloomberg gauge...

...The “game changer” will be if China suffers broad-based capital outflows, including from households, rather than tactical moves such as companies reducing their dollar liabilities, said Jean-Charles Sambor, Asia-Pacific regional director at the Institute of International Finance. “This would be a significant problem for China and the rest of the world."...

...Analysts at JPMorgan Chase & Co. said in a report that outflows have the potential to become “practically boundless” as they broaden, citing examples such as larger foreign direct investment by China and foreign investors exiting Chinese equities and bonds. More than $110 billion left China in November, the most recent month for which data is available...

...Households are sitting on $85.2 billion of foreign currency, according to the most recent data, which runs to November last year. The amount increased by $13 billion over the first 11 months of 2015, similar to the total increase for the previous five years combined...



Years in the making:

Remember all those reports about how many power plants China was going to build? Was power supply planning in China based on how much is needed to grow the economy? Or were the drivers similar to what has given rise to empty shopping malls, apartment buildings and even entire empty cities?

"...China has swapped out a debt-fueled foreign demand binge for debt-fueled local government spending spree...after which it will be very hard to generate demand..."

[thriftyandboringinohio]

Re: Baltic Dry Index = 0 ships at sea?!

First, as I understand it's the World Trade Organisation (WTO), not WTF.

Second, this was nothing more than another example of a thinly disguised protectionist move for US producers. The USA Department of Commerce is the closest thing to legalized thuggery.

If Canada had insisted on exactly the same country of origin labelling of all the food that is imported from the USA (and it's a LOT), the US government would have been screaming holy terror and sending the Marines.

The USA is part of a trade agreement zone. Abide by the rules. If you don't like the rules then negotiate to change them. But until they are agreed to be changed abide by the rules that were agreed by all parties when the agreements were struck.

The USA is the first to complain when contract law is broken by others. And the first to try to break it itself, because it thinks it has the heft and size to steamroll everyone else. I am not an anti-American. Quite the opposite, as anyone who has been around this forum for a while will know, but this, and its unilateral declarations of war followed by dropping bombs on foreign civilians, are the two consistent behaviours that I find abhorrent about the U.S. of Eh.

Edit added: Just a clarification. What Canada did was specifically ask the WTO to exempt it under its international trade obligations and allow it to put tariffs on the imports of USA produced fruits, vegetables, grains, prepared foods, liquor, wine and a number of other items. It was only the threat these USA products would be priced out of its closest export market that caused it to reconsider.

Thanks GRG55, your explanation is far more cogent than mine, and I did get the name of the WTO wrong and then use it for a wisecrack.

Your point is well-taken that the U.S. is as dirty as any other.

Your details show how the process works, where a company uses the hammer of huge and broad tariffs, enforced by trade agreements, to compel some nation to change its laws or regulations so it's people will buy more of the stuff they would rather avoid. The most obviously egregious examples are the big tobacco companies suing to dismantle strong anti-smoking regulations in Uruguay, Australia, and Europe.
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[Southernguy]

Re: Baltic Dry Index = 0 ships at sea?!

+1

I avoid food made in China & Japan (ties with China due to Fukushimaya), and then followed by Taiwan & USA.

If you look at the ingredients of processed foods and stuff like cereals made by big corporations, a lot of them are sourced from China. They don't list the source of ingredients but if it's from a big corporation, you can bet that it's from the cheapest source and purchased in bulk.

My top choice is organic NZ produce, followed by Australia, Korea and then the food producing EU countries like Greece, Spain, Italy.

I think you could add uruguayan beef, olive oil and wine to the mix....if you happen to come across some.
As for beef I am a (small) producer myself. No antibiotics or hormones, and as far as I am aware that behaviour is widely adopted. We do supply animals with antiparasitic drugs on a regular basis but respect waiting time specifications. I think being into major and heavily controlled markets (EU, Israel, etc.) is a guarantee that rules are obeyed.