BOW WAVE 290

Bow Wave Issue 290--LIfe on Mars Edition

news and views on trade, insurance and risk

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Wavy Line	sam@wavyline.com
(c)2005 WavyLine.com	Issue No 290 13 Jun 05
Published free of charge to Readers
Editor: Sam Ignarski
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In this issue:

1. Welcome
2. In the Wake--the Views of Gray Page for June
3. Interplanetary Supply Chain Management
4. Ambiguous "Household" and Maritime Insurance Coverage
5. Seawatch
6. And Finally...

1. Welcome

Poem of the Week

I Stepped from Plank to Plank

I stepped from plank to plank
So slow and cautiously;
The stars about my head I felt,
About my feet the sea.

I knew not but the next
Would be my final inch,--
This gave me that precarious gait
Some call experience.

Emily Dickinson

This poem was spotted on a poster in a Circle Line Train. It is one of many chosen by the Poetry Society. The posters are changed regularly. What a good idea.

For further examples of "Poems on the Underground" go to:-

http://www.poetrysociety.org.uk/education/under.htm

New Readers this week include:

Rohan Wijeyaratna MD of Ceyline Engineering in Sri Lanka Lawyer Eurof Lloyd-Lewis of Barlow Lyde & Gilbert in London Roman Reut of Swiss Re
Lawyer Silas Taylor of Andrew M Jackson in Hull
Vicky Kafetzi of gfx.com in London
Parisian Lawyer Odile Plegat
Silvia Mussuto in Argentina
John Eagle

News About Readers

Kaare Langeland is now with Holman Fenwick & Willan in Hong Kong

Contact details:-

Kaare.Langeland@hfw.com.hk

Fine Art underwriter David Scully has joined XL

Cargo Underwriter Guy Landymore has left XL

Odile B.K.Plegat is a French lawyer-attorney specialized in maritime law with 25 years of experience in international, maritime, European law and knowledge of US law ( she has an LL.M from New York University) Bilingual and bicultural, she has lived in the US and is a French citizen.

Most of her experience has been gained working for international foreign and French law firms. Her most recent job involved creating and running a marine survey firm. As of today, she is looking for a position in an organisation where she could use her knowledge of maritime/transportation law and her language skills.

She is perfectly willing to work abroad, preferably in an English speaking country (Australia, US, Europe)

Contact her at:-

odile.plegat@wanadoo.fr

Readers Write

Jeffrey Blum writes:-

Calling all ICS London Branch members - free lunch Wednesday 15th June
All Members and Fellows of the Institute of Chartered Shipbrokers are reminded that the next free buffet lunch will be held this Wednesday 15th June from 13:00 until 14:30 at the wine bar "Marine Broker", at the top of Leman Street (5 minutes' walk from Aldgate or Aldgate East stations).

All members are encouraged to bring non-members with them - this is a great way to network within London's buzzing shipping community. For catering purposes, do please send a brief email message to the London Branch Secretary - on or before Monday 13th, to let her know how many will be attending.

Valerie@vstringer.fsnet.co.uk

You can keep in touch with all the Branch news and events at

http://www.icslondon.org.uk

AfterOfficeHours News

New subscribers this week to the new directory of emergency services providers include Middle East
experts Inchcape Shipping Services (Dubai) and
Harry Karanassos

http://www.afterofficehours.com/d_page.php?id=100

Our News section is a weblog which reports on the news and views of subscribing members--This week
Gray Page reports on developments with Shiploc

http://www.afterofficehours.com/news.php

Release 2 of AfterOfficeHours will include a news section for each subscriber to state a point of view or release their latest news.

Frequently Asked Questions

Question 1:
I already have a website. What can AfterOfficeHours do for my firm that Google doesn't do already?

Answer:
Type in the words "Marine" "Surveyor" "Antwerp" into Google and you will be presented with 980 selections to sift. Hardly the thing in the circumstances of a late night emergency. AfterOfficeHours has two search methods. The basic search scans the pages of subscribers and returns a result. The advanced search will search against a name, a road, a town or a date and return a much more filtered return. If all you can remember is a name or a building, the advanced search will try and find it in the subject listings.
Question 2
:
I'm already on the Web. Why do I need AfterOfficeHours as well?

Answer:
A further practical advantage for subscribers is the ease with which they can update their entries on AfterOfficeHours. No special html tags or other marking up is required. Entries can be changed daily without difficulty. Subscribers can reclaim the flexibility of the web without going through the webmasters, IT departments , webdesigners, or slow moving committees.

Question 3

My firm already appears in the directories of various clubs and insurers. Why should I list in AfterOfficeHours?

Answer:
Work available through the Clubs and Insurers is highly sought after and in short supply. Correspondents and agents are suitable business partners for other parties who have a need for a local presence and local knowledge. Use After OfficeHours to inform the world of what you can do.

AfterOfficeHours Subscription Rates

Basic Subscription £250
Silver Subscription £600
Private Directory £tba

There is a Free 3 Month Trial Period
Register at:-
http://www.afterofficehours.com

Enjoy.

2. In the Wake--the Views of Gray Page for June

--> Tanker Consolidation--Is It Really Needed?

Consolidation, is it a good thing? There are compelling arguments for both sides of many issues in life today and, whatever the industry concerned, the arguments for and against consolidation are usually the same. Tanker sector consolidation has been a consistent message from the Fredriksen shipping empire and Frontline are once more leading a campaign to get the issue back on track.

But why is consolidation needed? The real argument in its favour from some is essentially that there are too many players sharing the profits. Not so bad you could say, perhaps fairer to all. But sharing profits with others is not a good thing where some of those players are publicly-listed and must meet the demands of shareholders. One way to improve those profits and increase the share price is to turn two or more players into one. But that situation arguably benefits shareholders more than it necessarily does the operational requirement of the tanker market.

The 'dangers' of a fragmented market are often cited as a reason to consolidate. These dangers might include possible price volatility from having too many cooks spoiling the broth and greater difficulties in attracting capital investment. Whether either or both of these dangers actually occur because of a 'failure' to consolidate can only ever be answered after the event. Whether either really is a danger is also debatable. Frontline already consider the tanker market to be too fragmented, but that has not stopped them, as Lloyds List has quoted, from increasing first quarter 2005 results by 30% and making some weighty returns to shareholders. Danger to the sector would be better reclassified as danger to the level of profits of shareholders.

In the best tradition of trying to satisfy both, perhaps the best foot-forward would be to consolidate the thinking of all those involved in the tanker market. Not everyone seems to agree on consolidation or how it should be achieved, let alone whether it is needed. Perhaps the answer is simply that consolidation may have benefits for some, but is not actually a necessity at all.

--> Ship Finance--High Risk, Low Reward?

An article in Fairplay Magazine for its June 9th issue shows that in the last six months shipping banks have been getting the rougher end of the deal on the terms of loans to shipowners. That is not to say all shipowners have the upper hand, just those top or middle-rank, with the small owner still facing a tough job to get financing at all. Equally, not all banks have found it tough--take Deutsche Schiffsbank which improved it performance of shipping loans for 2004 with very solid margins. But with larger shipowners operating in high markets with greater liquidity and banks generally facing fiercer competition between themselves, the former are in a strong negotiating position. It seems that if one bank says no to an owner’s terms, the owner can simply go down the road confident that he will find another that will. The situation is beginning to look a little bit reminiscent of the UK housing market, with banks slugging it out on improved loan terms and offer ever better deals, with home-owners taking advantage by swapping lenders as often as they might go on holiday. That is not to say that financing or re-financing your ship is as easy as your house, only that the general market parameters are similar -- bank fighting bank.

But business is business and what goes around comes around. Is it therefore a real concern that the banks are not making as much out of their loans as they used to? The answer is certainly no, not least when compared to the underlying reason why the banks are in the position they appear to be. The longer term economics of a situation where banks are loaning two or three times more for the same ship now than they did a few years ago is a worry. The underlying
real-term value of loans has increased considerably and can only be supported by a continuation of the market we are in.

Whilst banks are not of course responsible for the value of ships, it should be questioned as to whether high sums being paid for ships and the loans obtained to finance them can genuinely be supported for the medium to long term. What will happen when China stops importing so much raw material, or even just WalMart (which reputedly accounts for some 25% of the annual US import of containerised goods from China all on its own) decides to scale back on the stock it puts on its shelves? This kind of issue has worried many market pundits for some time.
Nobody can really say when a down-turn will occur, but all say it will happen at some point. No doubt the banks will have a few work-outs on their hands when that happens.

As to consolidation, perhaps the relevance of this question could be asked of shipping finance. With owners having fewer options to try when one bank declines the terms, it would not be so easy to find one that will. Mind you, that is sure to be an
unpopular reason for doing it. As ever, you cannot please everyone all of the time.

http://www.graypagelimited.com

3. Interplanetary Supply Chain Management

Thanks to the ever enthusiastic Jeff Ashcroft, the moderator of the About Logistics/Supply Chain website, we learn that two MIT academics have been commissioned by NASA to to conduct research to support its new vision for human and robotic space exploration.

http://exploration.nasa.gov

David Simchi-Levi, Professor of Civil and Environmental Engineering and Engineering Systems and Olivier de Weck, Robert N. Noyce Career Development Assistant Professor of Aeronautics and Astronautics and Engineering Systems will lead the "Interplanetary Supply-chain Management & Logistics Architectures" project, in partnership with the Jet Propulsion Laboratory, Payload Systems Inc. and United Space Alliance, LLC. Its purpose is to create a framework for analysis and strategic planning of the future interplanetary supply-chain.

The interplanetary supply-chain encompasses the transfer of goods and associated information from terrestrial suppliers to launch sites, the integration of payloads onto launch vehicles and launch to Low Earth Orbit (LEO), the in-space transfer of payloads from LEO to the Moon and Mars as well as planetary surface logistics.

http://logistics.about.com/b/a/173604.htm?nl=1

4. Ambiguous "Household" and Maritime Insurance Coverage

Dennis Bryant's Maritime Items e-zine reports:-

Over a vigorous dissent, the U.S. Court of Appeals for the Eleventh Circuit ruled that the live-in boyfriend of a boat owner is entitled to maximum coverage under a maritime insurance policy. The boyfriend had been living on the boat with the policy owner for approximately 20 months. He suffered severe injuries when diving off the boat into shallow water. The policy provided $100,000 coverage, but was subject to a limitation of $25,000 for claims brought by a member of the insured’s household. The boyfriend sued the boat owner, who promptly confessed judgment. The insurance company filed for declaratory judgment, arguing that the boyfriend was a member of the owner’s household. Defendant policy owner and her boyfriend contended that "household" meant someone related by blood, marriage, or adoption. The court held that the term was ambiguous and to be construed against the insurance company. The dissent is worth reading.

Continental Insurance Co. v. Roberts, No. 04-12566 (11th Cir., June 3, 2005)

http://www.ca11.uscourts.gov/opinions/ops/200412566.pdf

5. Seawatch

The latest issue has appeared of this lively webzine which is edited by Robert Gordon who runs a
correspondent's network from Singapore. It contains a learned piece on Ship Arrest in China and Hong Kong by Andrew Horton, numerous pieces on the local industry of piracy, and a press archive which has more and more Asian port news these days.

It is refreshing to read strong opinion in a zine coming from a walk of life which is pretty mealy-mouthed most of the time. Few correspondents make such an effort to communicate their world, let alone show an ample zest for the job.

Seawatch could be improved in a few small ways. It is a very large publication to receive down a slow phone line, which is what many people still have--a plain text version would reach the places other larger publications rarely go..Then there is the matter of frequency. It is better to be on time every time with a publication of half the length than late with a bumper and more perfect edition because in some strange way reliable periodicity makes for a stronger relationship between Editors and Readers.

http://www.seasia.com.sg/base/newsletter/newsletter.htm

6. And Finally...

Thanks to Paul Dixon's Joke of the day for more Murphy

Everything can be filed under 'miscellaneous'.

Never delay the ending of a meeting or the beginning of a cocktail hour.

To err is human, to forgive is not company policy.

Important letters that contain no errors will develop errors in the mail.

There is never enough time to do it right the first time, but there is always enough time to do it over.

If you are good, you will be assigned all the work. If you are really good, you will get out of it.

If it wasn't for the last minute, nothing would get done.

At work, the authority of a person is inversely proportional to the number of pens that person is carrying.

No one gets sick on Wednesdays.

The longer the title, the less important the job.

Once a job is fouled up, anything done to improve it makes it worse.

Success is just a matter of luck, just ask any failure.

PS......Thanks to Frazer Hunt for these.

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NORDIC TRACK $300 Hardly used, call Chubby

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JOINING NUDIST COLONY! Must sell washer and dryer $300

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FOR SALE BY OWNER: Complete set of Encyclopedia Britannica. 45 volumes. Excellent condition. $1,000 or best offer. No longer needed, got married last month. Wife knows everything

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