The economy has been creaking for a while, but when the history books are written they’ll hone in on September 2008. Besides all the market deterioration and the financial collapse, September was when the real economy started to suffer bad. On several earnings calls this quarter, companies have pointed to the last few weeks in September as when things turned sour.
Here’s more macro evidence. Shipping volume out of two West Coast ports, LA and Long Beach, fell hard in September. This chart, courtesy of Calculated Risk, just looks at the volume of shipping containers leaving and entering the ports:
Here are some numbers for Long Beach:
Not that any of this should be a surprise. We’ve talked about the collapse of the Baltic Dry Index (a measure of shipping rates) a few times, so this is basically another way of viewing the same phenomenon.
Out of curiosity, we were poking around to see if there were any way enterprising investors could speculate on the BDI, like if you thought it might produce a surprise spike back up. Check out Imarex, which has developed a market for BDI futures. We suspect they made sense a few months ago, in better times. If only we’d known about the recent development of this market, we might’ve had an early sign of the top.