BDI Baltic Dry Index Weekly Chart

The Baltic Dry Index, BDI, is navigating choppy waters. It is amazing to see the BDI languish at 695. The BDI is an excellent measure of the health of the global economy. The Baltic is a conglomeration of prices to ship dry goods such as iron ore, steel, cement, coal, powders, tires, recycling materials, grains, etc..., compiled daily.

Raw materials are the key building blocks of a strong global economy. If steel, platinum and palladium demand weaken, the auto sector is likely weakening. Ditto if the rubber and tire industries are slowing. This means less autos and machinery are being sold. Less resins and powders indicates low demand for plastics. Less lumber indicates a slowing housing industry. Less cement means construction projects are slow.

In a healthy economy, the raw materials shipments are increasing and prices climbing higher. Look at that big-time peak in the data, a double-top, or M top, exactly peaking at the October 2007 stock market high and then the second peak is the summer of 2008 just before the stock market began crashing in earnest.

Baltic Dry Index prices remain soft in a multi-decade lower trend indicating that the global economy is not as strong as many tout. Global economies are contracting. The slow demand in raw materials hints that the world muddles through a slow, stagnant, lackluster economy. The shame of it all is that this is what we have after one-decade of obscene Keynesian spending by global central bankers that only served to make the wealthy elite class more filthy rich. Sadly, the faux free markets and crony capitalism financial system are on full display daily. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.