Tag Archives: Suez Canal

A Rising Dollar Sinks All Boats, by Tom Luongo

When somebody borrows dollars, they’re essentially short the dollar (they would like to pay back with dollars that are worth less in other currencies). Given the huge amount of dollar-denominated debt out there, the world is short dollars, which is a problem if it’s value against other currencies goes up. From Tom Luongo at tomluongo.me:

Every day I open up my web browser to see yet another example of the basic functions of society breaking down.  Last week it was the vaporization of Archegos capital. I told you what I thought of this in a post that I hope, got people thinking.

Previous to Archegos, over the past two months we’ve seen the electrical grid collapse in Texas, hedge funds blown up over a meme stock.  Bitcoin is screaming that the national fiat currencies are all hyperinflating at the same time.

In the case of the recently solved Suez Canal incident, it doesn’t matter if it was incompetence or malicious behavior which caused the Ever Given to stick in the mud, in a world this fragile the smallest mistake can have outsized consequences.

The few days the canal was blocked caused an enormous pile up and re-routing of basic supplies and fundamentally important goods to Europe and North America that, to me, is a harbinger of where we are headed.

An overly complex world is an inherently fragile one.  Global trade is dependent on a handful of chokepoints remaining clear, like the Suez or the Straits of Malacca.  Jam up one of them and watch our everyday life we take for granted collapse.

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Suez Canal Megaship “Partially Refloated” Ahead Of US Navy Assessment, by Tyler Durden

Here’s a comprehensive, up-to-date account of the ship that’s blocking the Suez Canal. From Tyler Durden at zerohedge.com:

Here’s today’s overview of the continued logjam at the Suez Canal:

  • Ever Given Partially Refloated At Stern
  • At Least 20 Vessels Carrying Livestock Stuck At Canal
  • IKEA Warns Containers Filled With Goods Blocked By Suez Crisis
  • Vessels Already Diverting Course from Suez Canal To Cape Of Good Hope
  • US Navy Arrives Saturday To Assess Ever Given
  • 300 Vessels Waiting To Traverse Canal
  • Tanker Rates For Suezmax Vessels climb to $17k Per Day
  • Suez Blockage Results In Rising Container Prices From China To Europe
  • Tugboats And Dredging Ships Were Unsuccessful In Refloating Ever Given
  • Bloomberg Report Process To Refloat Ever Given Could Take Until Next Wednesday
  • Shoei Kisen, The Japanese Owner Of Ever Given, Aims To Dislodge Vessel From Canal Bank By Saturday
  • Suez Canal Authority (SCA) To Cooperate With US To Refloat Ever Given

* * *

Update (1654): So just how stuck is Ever Given?

The Suez Canal’s engineering documents show a cross-sectional diagram of the channel where the container ship is stuck.

An overlay of the container ship and the channel’s cross-sectional piece suggests the vessel is more stuck than what meets the eye via ground-based footage and satellite imagery.

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