Lay-Up / Scrapping – In Defense of Rational Capitulation

There are enough tough decisions in shipping to make the gambler’s quandary look tame by comparison. The gambler’s choices are painful, but they are stark. He has at hand all information that is ever going to be available and the odds don’t change tomorrow. The ship owner, by comparison, lives in a dimly lighted casino where his cost of doing business is not really the lowest cost at which he will do business – and everyone knows it. The odds move much faster than his ships. Even when he manages to preserve or grow his assets, the fleet is always a wasting asset. If, during a prolonged poor run of luck the owner takes the draconian step of scrapping his ships, he may be permanently barred from the casino or at minimum, gaining re-entrance can take years.

To dwell on the perils to making money in shipping would be self-serving. It is the business our readers and we are in by choice, and most leave via retirement, not defection. Bored faces on the world’s commuter trains are mute testimony that there is no free lunch anywhere. So the question we set out to answer is not whether shipping has more shoals and reefs along the course to success than other industries, but whether the industry itself makes life more difficult for itself than it need be.

This is only an excerpt of Lay-Up / Scrapping – In Defense of Rational Capitulation

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