More than 200 container ships with combined capacities of more than 800,000 TEUs are now laid up. “Idled”, is the word industry officials like to use. “Wasted” is closer to the truth.
What proved to be excess “capacity” had been ordered by shipping line officials in spite of the fact that, for a number of years, leaner times were being forecast by respected economists. Euphoria, however, not logic, has been the order of the day.
Understandably, that excess capacity is being laid up because those vessels are not needed. There’s nothing to ship on them. Asian factories are being shut down and workers are being laid off by the millions, and so production is declining and fewer products are therefore available for shipping.
Asian factories are being shut down and workers are being laid off – and therefore fewer goods are being shipped – because fewer goods are being ordered. And all this because the kingpins in the whole economic scheme of things, U.S. consumers, are ordering (demanding) less and less goods.
U.S. consumers are demanding fewer goods because so many of them are unemployed. It’s like watching a setup of dominos collapsing. And it all starts with the U.S. shopper. The unemployed U.S. shopper.
But our leaders don’t seem to recognize this flow of events. They’re hung up on the idea that if billions of bailout dollars (taxpayer’s dollars) can be turned over to the banking system and to other providers of credit, then credit will be extended once again to shoppers who will then march out to retail establishments and charge, charge, charge.
The fact that these potential shoppers have no way to repay the money they’d be borrowing doesn’t seem to register with our financial geniuses. Nor has it occurred to them that the scheme (scam?) they’re promoting is the very idea that got us into this depression mess.
With typical abandon and with their heads in the sand, however, our elected representatives and their expert advisers intend to fuel the inferno. If they’d remove their blindfolds and take a look at the figures released last week by the U.S. Department of Labor they’d come to their senses. Maybe.
The February 5th MarketWatch issued this report:
“First-time claims for state unemployment benefits surged in the latest week to the highest level in over 26 years, the Labor Department reported Thursday. The number of initial claims in the week ending January 31 increased 35,000 to 626,000.”
Those are “first-time claims”. “Initial claims”. It means that 626,000 more Americans lost their jobs that week. Are these the folks to whom banks and lending institutions will be extending credit? Even though their paychecks have been terminated? [How do you spell “scam”?]