Jul 24

World Trade Slumps By Most Since Financial Crisis (ZeroHedge, July 23, 2015):

As goes the world, so goes America (according to 30 years of historical data), and so when world trade volumes drop over 2% (the biggest drop since 2009) in the last six months to the weakest since June 2014, the “US recession imminent” canary in the coalmine is drawing her last breath

World Trade Volume

As Wolf Street’s Wolf Richter adds, this isn’t stagnation or sluggish growth. This is the steepest and longest decline in world trade since the Financial Crisis. Unless a miracle happened in June, and miracles are becoming exceedingly scarce in this sector, world trade will have experienced its first back-to-back quarterly contraction since 2009.

Both of the measures above track import and export volumes. As volumes have been skidding, new shipping capacity has been bursting on the scene in what has become a brutal fight for market share [read… Container Carriers Wage Price War to Form Global Shipping Oligopoly].

Hence pricing per unit, in US dollars, has plunged 14% since May 2014, and nearly 20% since the peak in March 2011. For the months of March, April, and May, the unit price index has hit levels not seen since mid-2009.

World-Trade-Monitor-Unit-Price

World trade isn’t down for just one month, or just one region. It wasn’t bad weather or an election somewhere or whatever. The swoon has now lasted five months. In addition, the CPB decorated its report with sharp downward revisions of the prior months. And it isn’t limited to just one region. The report explains:

The decline was widespread, import and export volumes decreasing in most regions and countries, both advanced and emerging. Import and export growth turned heavily negative in Japan. Among emerging economies, Central and Eastern Europe was one of the worst performers.

Given these trends, the crummy performance of our heavily internationalized revenue-challenged corporate heroes is starting to make sense: it’s tough out there.

But not just in the rest of the world. At first we thought it might have been a blip, a short-term thing. Read… Americans’ Economic Confidence Gets Whacked

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3 Responses to “World Trade Slumps By Most Since Financial Crisis”

  1. squodgy Says:

    I think that by now, even the dumbest amongst us realises things are not right.
    Buying patterns are changing, sometimes for the better where totally unnecessary items on the shopping list are rubbed off, with purchasing power going to basic essentials.

    The likes of P&G, Nestle, Mars and Hershey, will be feeling the pinch, but I feel once the idiots amongst us are wiped out by the GMO, and fast food industry, those who woke up and adjusted will have the edge over the residue.

    The next phase will be a boom in simple things like slow cookers, where really good food is cooked for you while you’re at work.

  2. Marilyn Gjerdrum Says:

    We were remarking the other day how so many wonderful shops I used to love no longer exist………people cannot afford them any longer.

    Economics are the ultimate truth and reality……….they cannot be denied forever. The longer they wait, the worse the pain………….Rather like ignoring cancer……it doesn’t offer long term benefits.

  3. squodgy Says:

    A year later and it’s still falling, but “nobody seems to notice, nobody seems to care” and the media remains silent.

    http://wolfstreet.com/2016/08/24/world-trade-falls-second-quarter-in-a-row/

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