Good question from a reader

qte

So Samoa is skipping friday. If I were a charterer, and was trading the vsl around Samoa, how would this effect the payments i make to the owner? Do I not have to pay for friday?! Well technically that one friday doesn't exist.

http://edition.cnn.com/2011/12/27/world/samoa-dateline/index.html

 

unqte

 

haha - my guess is that a "day" is still 24 hours....so although friday disappears the 24 hours will still count

 

great question though!

 

Btw - to all those readers owed a reply from the Virtual Shipbroker - I am on holidays for a few more days. I realise there are quite a few of you expecting replies. Hang in there and i will revert soonest. Plus i have been in a prerpetual state of drunken stupor for over a week so adding anything to this blog in my condition is not a good idea. 

 

2012 will be the best year yet - of that I am sure

 

Keep Rock'n

VS

 

 

Shipbrokers 12 days of Christmas

On the 12 th day of christmas my therapist said to me

12 Phones are ringing

11 Ships are sailing 

10 Banks are calling

9 Pounds im heavier

8 Trading screens

7 Days a week

6 Figure bonus

5 ..........Failed on sub...........sz,....

4 calling (girls)

3 Hours sleep

2 bottles of gin

and a boss (or wife, or husband) who is never happeeeeeeeeeee.

HAPPY FESTIVE SEASON TO ALL (CHRISTIANS AND NON CHRISTIANS ALIKE)

Sign of the times

In this prolonged recessed shipping market we are starting to see some trends emerge.

Banks are getting increasingly nervous - News that more and more shipping banks (those that lend to the sector) are losing patience and are now refusing extra cash injections, rejecting new investment pitches, being inflexible on repayment plans and are in fact calling in some of the moneys owing to them from shipping companies no longer able to trade as going concerns.

The problem for banks is that they are claiming ships back from clients at a fraction of their market worth from a few small years ago.

So they help finance a ship for USD 50 million, market crashes and same ship is worth 20 million and their client files for bankruptcy.....with 40 million still owing. What would you do if you were the bank?

They are either selling them for only a small portion of their previous market value, or even worse they are sending them straight to the scrap heap for the price of a song (for older cheaper ships).

Demolition yards are reporting more business, which to be fair is probably a good thing for the mid term viability of freight rates which are too low...

Instead of selling the ships to others or sending ships to the scrap heap another option banks are increasingly looking at and in fact doing are keeping the ships and entering into chartering and/or management agreements with some of the industries more reputable (and solvent) players.

So option 3 is keep the ships on the books, charter them out and wait till the market improves the asset values ............and then sell them. The key for many banks is if they sell they lock in a loss...a massive loss.

So some financially strong players like Oldendorff and Klaveness to name a few a being approached to handle "distressed assets"........and one can only imagine that the trade off for a good counterparty would be very attractive rates, terms and conditions. So put bluntly the strong larger shipowners are securing lucrative deals that others cannot get near.....because of smart prudent management over the last 3-5-10 years..

And its not just the banks. Some shipyards have seen customers disappear leaving them to hold the new born babies........so instead of accepting much cheaper prices in the current gloomy markets they too are partaking in interesting chartering deals with shipowners (in order to avoid booking in losses). Charter deals between shipowners and yards are nothing new in both low (current) and high markets.

Economists call this process "consolidation"....the inevitable result of a sustained economic downturn where the smart, secure and cashed up survive.

VS

Should a charterer do business with a shipowner in financial trouble?

There are a number of shipowners / shipoperators around with less than healthy financial positions. Some of them are quite well known, the banks and creditors are onto them and they are treading a fine line hoping to stay afloat until market conditions change.

So the question is "should a charterer fix with a shipowner who is in some financial trouble".

Well theat depends.

First thing is this. The charterer is the one who pays the shipowner, so this is a prefered position to be in. You are the the one who owes the shipowner not the other way around. So yes i think from a starting point fixing your cargo to a fincially insecure shipowner is ok. What you don't want to be doing is fixing your ship to this same owner (to cover one of their cargoes) because they then need to pay you.......and this will be problematic. Especially if they are in survival mode.

Secondly for voyage cargoes, a financially strapped shipowner will more than likely be super aggressive which is great as the charterer gets a super cheap rate. The reason a financially strapped shipowner craves voyage cargoes is because of cashflow. If he fixes a voyage cargo he get 95% or 100 % cash upfront. If on the other hand the cash strapped shipowners opts for time charters he gets drip fed cashflow every 10 or 15 days.....which is not great for him.

So there is an opportunity for a win / win in this case. Cheaper rates for voyage charterer, cahsflow for owner on the skids.

The biggest problem you can have is if the ship carrying your cargo gets arrested. Then your cargo could be stuck onboard causing immense pain for months to come.
Never fix a long term contract with a shipowner unless they are financially sound.


Dont comma rockin if the repo man comes a knockin...(that makes no sense but run with it...)

VS

Personality Types

I have recently been quite interested in the idea of Personality Types and how your ingrained preferences can dictate just about every outcome in your life.

The most famous personality test is called the Myers Briggs test and it groups you into one of 14 distinct personality types and using this information it can predict / give advice about everything from most suitable jobs, suited partners and what hobbies you will probably enjoy

For me it has been a scary revelation. I am what is known as an INTJ personality type which is the rarest in the land making up only 1 pct of the general population. Whats interesting about INTJ's though is our over representation on the internet when it comes to financial blogs and blogs about early retirement. The INTJ is known as the "mastermind" and we like to find efficiencies and systems and then exploit them (in a good way) to our benefit. Certainly important for shipbrokers and charterers i would have thought.

Anyway - INTJ's make up approximately 38 percent of all financial bloggers accross ideas such as finance, realestate and retiring early. A massive over representation which is is interesting to me anyway.

But no word on whether INTJ makes a perfect Shipbroker - if there is such a thing, I actually think E type personalities are more likely to make better day to day shipbrokers as they are more social. But like most things there is room for everyone. As is said being efficient and finding holes in certain markets has certainly worked well for me.

Here is a simple 5 minute test..

http://www.humanmetrics.com/cgi-win/JTypes2.asp

Drop me a line and let me know what you are?

Cheers
INTJ VS

Possible new intake - exciting chance

The current crop of students in the VS dry cargo chartering and shipbroking certificate are coming towards the end of their 4 month course and from all accounts the course has once again lived upto expectations (and more).

A current student - "This course I will really miss and has given me huge confidence in my day to day activities".

Now just on that matter. My intention was not to run another course until early 2012 BUT I have had a handful of requests asking if there is any chance to start earlier - namely from the first of December.

For me I have some flexibility and it all depends on numbers. I need more than 2 students to make it worth while

So to those that missed out on the last intake here is your chance to fast track your skills sooner rather than later.

If any of the readers are interested in enrolling in my Shipbroking Certificate starting December 1st (final confirmation will depend on numbers) then please let me know within the next 3 days!

email; virtualshipbroker@yahoo.com

If no takers then we push it back to next year!

(btw the traditional christmas months are a good time to study as the markets wind down a little)

For further information on the course including format and cost just surf the blog and all will be revealed.

cheers
The Virtual Shipbroker

Whats shipbroking about then?

As readers of the blog will know I run a consultancy business for anyone wanting highly confidential, expertise when fixing deals. And i Don't mean my real work (what I do for a living) I mean a Virtual Shipbroker Consultancy Business.

Virtual Shipbroker Consultancy click here

The great news is that a handful of really smart people have taken me up on the consultancy offer and are kicking huge goals.

Had two on line today with two different problems which really goes to the heart of what makes a great broker.

Both have problems. Both cannot get owners to offer for various reasons. One client has an owner who is aggressive on rates for a substantial coa (contract of affreightment) but on checking with agents see's that charterers have issues with surveyors and ships being rejected because of hold cleanliness issues. The other client cannot seem to bridge the gap of USD 2.00 between charterers ideas and the best offers he has from owners....

Guess what people - Welcome to shipbroking!

If it were easy everyone would do it. The best shipbrokers love "problems" because problems need to be solved and a shipbroker worth his commission can now ply his / her trade.

What is needed?

Good communication between all parties.

I often see fixtures fall apart because Principal A doesn't really understand what Principal B is doing - or why there is hesitation. Often the broker in between has no idea either. So a good brokers see a problem, get to the bottom of understanding the problem, and with the right "touch" find solutions which eventuate in a FIXTURE.

If someone doesn't see a problem, let alone understand how this problem can be solved - well.... they get nowhere.

This is where having me as a consultant comes in. I help see problems before they arise, help solve them, help make you money, help teach you in the process...

WIN / WIN....

Hire me! ha...

Cheers
VS

I haven't done a zen posting for a while

In Washington , DC , at a Metro Station, on a cold January morning in 2007, this man with a violin played six Bach pieces for about 45 minutes. During that time, approximately 2,000 people went through the station, most of them on their way to work.

After about 3 minutes, a middle-aged man noticed that there was a musician playing. He slowed his pace and stopped for a few seconds, and then he hurried on to meet his schedule.

About 4 minutes later:The violinist received his first dollar. A woman threw money in the hat and, without stopping, continued to walk.

At 6 minutes: A young man leaned against the wall to listen to him, then looked at his watch and started to walk again.

At 10 minutes: A 3-year old boy stopped, but his mother tugged him along hurriedly. The kid stopped to look at the violinist again, but the mother pushed hard and the child continued to walk, turning his head the whole time.. This action was repeated by several other children, but every parent – without exception – forced their children to move on quickly.

At 45 minutes: The musician played continuously. Only 6 people stopped and listened for a short while. About 20 gave money but continued to walk at their normal pace. The man collected a total of $32.

After 1 hour: He finished playing and silence took over. No one noticed and no one applauded. There was no recognition at all.

No one knew this, but the violinist was Joshua Bell, one of the greatest musicians in the world. He played one of the most intricate pieces ever written, with a violin worth $3.5 million dollars. Two days before, Joshua Bell sold-out a theater in Boston where the seats averaged $100 each to sit and listen to him play the same music.

This is a true story. Joshua Bell, playing incognito in the D.C. Metro Station, was organized by the Washington Post as part of a social experiment about perception, taste and people’s priorities.

This experiment raised several questions:

*In a common-place environment, at an inappropriate hour, do we perceive beauty?

*If so, do we stop to appreciate it?

*Do we recognize talent in an unexpected context?

One possible conclusion reached from this experiment could be this:

If we do not have a moment to stop and listen to one of the best musicians in the world, playing some of the finest music ever written, with one of the most beautiful instruments ever made . . ..

How many other things are we missing as we rush through life?

Enjoy life NOW .. it has an expiration date

The Virtual Shipbroker