Dry Bulk Shipping Rates Crash the Most in 30 Years. Market Freakout?

Dry bulk shipping rates have been absolutely gutted since the start of the new year, and dry bulk shipper shares are crashing as a result. Should investors keep their hopes up for a rebound?

Jan 29, 2014 at 8:38PM

The Baltic Dry Index is now down 48% since the start of the new year. While a rate drop-off in the new year is typical because the Chinese New Year decreases demand in the world's largest economy, what is uncommon here is the magnitude of this drop. An article from Zerohedge points out that this is the biggest drop in 30 years for this part of the year, though even after the drop, rates are still 50% higher than they were at this point last year.

In this video, Motley Fool industrials analyst Blake Bos looks at how this is affecting dry bulk shipping companies, such as DryShips (NASDAQ:DRYS) and Genco Shipping (NYSE:GNK). With the enormous amount of debt that companies in this industry typically carry, many investors are worried that the companies won't be able to remain in business with rates at these levels, and the stocks look to be selling off as a result.

Blake also mentions that shipping rates do tend to rebound going into the summer, so for these shipping companies, it's vital that the rebound is a strong one. Various pundits are calling for a shipping-rates rebound in 2014, though Blake is less optimistic and still sees a lot of rough seas ahead for these companies.

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Blake Bos and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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