Wednesday, July 1, 2009
This index of shipping costs for bulk commodities has moved up solidly for the past seven months. Many people dismiss it as an indicator of global growth, however, arguing that the ships are being monopolized by Chinese demand for things like iron ore, and all they are doing is stockpiling the stuff. I prefer to think that the Chinese have a reason for buying commodities, and that it has to do with the fact that their economy is growing at multiples of most other economies in the world. What's good for China is good for the world; the more they produce the more they must consume.
Posted by Scott Grannis at 8:44 AM