“Gimme Shelter”

These lyrics from the Rolling Stones may in fact be a fore­warning of a storm brewing closer to home. At least for the moment, the shipping industry has been sheltered from the worldwide storm created by the credit crisis and the drying up of liquidity in the bank and public markets that began last August and culminated with the recent fire sale of Bear Stearns. Nonetheless, it is hard to fathom how shipping has apparently escaped this turmoil.A simple explanation, according to industry pundits, may be that charter rates and asset values are at historic highs and, instead of the normal cyclical nature of the business, we have entered into a period of super cycles driven by a commodity boom, which, in turn, is the result of the insa­tiable demand for commodities in China and India among others. With risk thus pushed out, an ever-increasing demand seemingly overwhelms any oversupply risk, lend­ing and investment become easier.

This is only an excerpt of “Gimme Shelter”

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