Business

Ships and the Global Economy

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The ocean shipping industry is, and always has been, a major enabler of global trade. Air freight is very important, as are communications technologies such as the Internet…however, there exists a vast array of products and commodities for which the only economically-viable means of transportation is the ship. Hence, anything that affects the ocean shipping industry has the potential to influence the shape of the global economy.

The International Martime Organization has approved new rules which will ban ships from using their traditional fuel (very heavy oil, known as bunker fuel) in most parts of the world. The rules are stated in terms of sulphur oxide targets, which will phase in over time. Specially-treated bunker fuel may meet the initial targets in some areas, but only distillates are likely to meet the long-term targets. This implies an eventual potential fuel cost increase for shipping operators of fifty per cent. More at the WSJ.

Increased shipping costs will, at the margin, encourage domestic and regional production of goods at the expense of imports. The strength of this effect will of course depend on the nature of the particular products–shipping costs as a percent of overall value are much higher for washing machines, for example, than for flat-screen TVs.

The new regulations are probably good news for this company. But even if their technology is very successful, overall costs per ocean freight ton-mile will still likely be going up as a result of the new regulations.

A commenter at the WSJ link asks some interesting questions:

What is difficult to discover is just how many people will be adversely affected by increased shipping costs. How will it affect sub-Saharan economies? Will it cause more problems for the shortest lived poorest people on the planet? will it reduce their life expectancy still further? There are reports that indicate the importance of low shipping costs to these economies but unfortunately no one seems to have measured the cost in lives of the current high fuel costs nor what it will be when the new measures kick in.

Keeping Austin Weird

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George Will looks at Austin’s campaign to keep itself weird. A useful contrast between the two flagship schools and the communities that house them might be interesting – community participation, generosity, attitude toward the “other.” Of course, analyzing levels of religious commitment, political philosophy, and applied citizenship in such minor commitments as voting and jury duty and larger ones such as enlistment would also be interesting. Last night, we watched Michael Apted’s Amazing Grace. He chooses to focus on the application of Wilberforce’s beliefs in the practical realm of politics, but the undercurrent (as certainly was true) was that the driving force that impelled him was his belief in the universal rights of man, his belief in a God and the God-given nature of those rights. But, of course, he was someone who was interested not just in believing but in acting. There is nothing more beautiful nor more useful than the practical application of the great beliefs.

Packing my boxes to move, I kept writing Austin, Nebraska – but once there, well, it felt like home for me as for so many others. Soon, Willy was setting up the first of the Dripping Springs concerts and I was reading manuscripts by the great twentieth century writers in one of the best two or three libraries in the world. Fromholz described himself as a rumor in his time and people claimed he’d run for governor (I don’t think very seriously, but who knew then). It’s cooler and dryer than much of the state and more laid back than about any place. Still, when both my kids packed up to move last year, they also felt they’d lived there long enough. I guess, in a way, so had we over twenty years before. It’s a good place to be young, but walking the dog down streets full of broken glass was getting to our daughter who lived in West campus; the rents had raised from our day but the druggies still dealt on the drag; the street people had gotten sadder (or maybe we’d just gotten older).

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“How many record execs does it take to screw in a lightbulb?”

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Very funny:

First of all, before we change anything, is the light bulb really burned out? Maybe we just need to breathe some life into it; repackage it, maybe the light bulb could do a duet with somebody (Sheryl Crow? Tim McGraw?) in hopes of getting some crossover appeal, maybe it could be in a beer commercial, maybe we could get it out on the road with a brighter light bulb. The other thing to think about is that this summer, Honda is rolling out a 100 Million dollar campaign for a new car aimed at thirty-somethings who consider themselves adventurous/spontaneous but can’t really afford something like a luxury S.U.V. and it might be a perfect campaign to tie this light bulb into, at least it would be the perfect demographic, in terms of age.
 
Also, and this is just an idea: what if we found out what video games are being released in the third quarter and maybe pitched the idea of having our light bulb make an appearance in the video game at some certain level of completion; like, you get to a dark cave, let’s say, if it’s an adventure game, and if you have enough points you can get the light bulb – and it would be our light bulb, obviously – and then it’s easier to see in the cave…

Not only is this passage funny and, from what little I know, accurate about how record-industry people actually talk (which is why it’s funny), it’s also a great piece of viral marketing because it got me and a lot of other bloggers to link. But it’s entertaining, so I don’t mind linking.