ABSTRACT
In this chapter we look at shipping economics from the perspective of the individual shipping company. Every company faces the challenge of navigating its way through the succession of booms, recessions and depressions which characterize the shipping market. During prosperous periods when funds flood in, it must meet the challenge of investing wisely for future growth and a commercial return on capital. The seeds of future problems are often sown under the heady influence of market sentiment at the peak of a cycle. In recessions the challenge is to keep control of the business when the market is trying to force surplus capacity out of the system by squeezing cashflow and take advantage of the opportunities. During these periods the shipping market is like a marathon race in which only a limited number of entrants are allowed to finish. The race has no fixed length, it goes on lap after lap until enough competitors drop out from exhaustion, leaving the surviving runners to pick up the prizes.
