Baltimore Harbor Closed for Business

By now everyone across the US has heard about the catastrophic bridge collapse in Baltimore Harbor. While many reports initially talked about the importance of the highway that was taken out by the loss of the bridge, the even greater matter of importance is the complete shutdown of the Port of Baltimore while the bridge rubble blocks the way—at least in the short term. How long it will take to clear enough rubble out of the way to be able to safely reopen the port is hard to say. It will open long before the highway does, but it may be a long blockage all the same.

As we add this total loss for the time being of a major US port to the shipping traffic snarls already starting to show on the East Coast due to the stoppage of Suez-Canal shipping to the US and due to partial shutdown of the Panama Canal, we are pushing harder and harder into those kinds of supply-chain problems we experienced after Covid. All of these sources of trouble were black-swan events that could not be predicted. Well, maybe the Panama could based on weather patterns, but not the rest. Yet, here they are because opportunities are abundant.

So, today’s news carries stories about how frantically logistics experts are working to try to reroute Baltimore shipping traffic and about how that “will result in widespread supply chain disruption.” That likely means some shortages and more inflation.

Biden bluffs

One thing I found particularly strange was how quick President Biden was to declare that the wipe-out of the bridge by a container ship was not a terrorist event. As soon as the news hit that the ship’s owner said the ship lost power and directional control, the Biden government jumped on that as all the evidence it needed in order claim this is not a terrorist event.

Sure, local harbor pilots were used, and maybe there is no reason to think any of them were embedded terrorists like we had on 9/11 with local airline pilots, but the perfect timing of loss of control right before the ship went under the bridge to cause it to veer hard to one side and center itself on one of the bridge’s two main supports certainly seems suspect.

The obvious thing that flashed through my mind right away, which apparently no one in the Biden government was smart enough to think of before rushing to a dimly lit conclusion about the cause, was:

Did someone sabotage the ship by doing something like placing a remotely triggered explosive on one side of the rudder that was designed with just the right force and placement to jam the rudder hard to one side?

Or:

Did China or the Russians or some Palestinian-sympathizing hacker group hack the ship’s software in a way that allowed them to seized control of the ship, perhaps by throttling down the engines on one side or reversing them while throttling up those on the other side to turn the ship (if it is a twin-screw ship) or by taking over the autopilot?

There were, after all, huge puffs of smoke like one would expect when throttling an engine suddenly to maximum and a brief loss of lights as, I suppose, one could get if shutting down an engine on the other side that ran the ship’s generator to reverse it then rev it back up. Technicalities aside, the point is there are ways to do it without having pirates seize the ship.

Then I heard General Flynn in a video linked below stating that it was way too soon for the Biden Admin. to rule out a deliberate act.

The jury is going to be out for awhile. I was asked earlier today, Alex, can we take the idea that this was a terrorist attack off the table? And absolutely we cannot do that…. We’ve all seen the videos where the lights went out on the ship. We’ve all seen the black smoke coming out of the top of it…. The harbor master has to answer a lot of questions about whether standard operating procedures were followed to the letter…. This is not only a massive commercial disaster, but this is a military and a national-security disaster because Baltimore Harbor is a place where there is an awful lot of military activities…. We cannot take off the table anything right now.

Regardless, we now have yet another event on top of wars that are disrupting US and international supply lines that will put upward pressure on inflation and downward pressure on the performance of the economy, itself.

More inflation

In the miscellaneous category for inflation today, cacao is soaring parabolically due to production reasons. I know we won’t die if we cannot afford chocolate because the little bean is ten times more expensive all of a sudden, but some of us might feel like we’re dying. Eggs are near historic highs, and here it is almost Easter! How will we survive that?

On a serious note, however, these shipping problems are putting more and more upward pressure on oil, an ingredient in everything one way or another, to where one article today suggests there is a fairly clear path forming to $90/bbl.