Last week we reported that, as measured by its three primary means of transportation, global trade is in nothing short of freefall: to wit – “China Container Freight At Record Low; Rail Traffic Tumbles, Trucking Slows Down.” The slowdown in this most important metric of global growth (or lack thereof), one which unlike asset prices can not be manipulated by central banks through “printing” was confirmed when Maersk, the world’s biggest container shipping company, reported it would cut shore-side headcount by about 4,000, a reduction of about 17%.

As reader Joe points out, they also declined to execute options for additional 19,000 TEU mega ship new-builds and a couple of smaller 3,600 TEU feeder vessels, and will postpone a decision on building some large 14,000 TEU vessels. He adds that industry analysts have been critical of Maersk’s counter-intuitive expansion over the past few years in a recessionary climate, during which the container carriage capacity that Maersk brought on line is credited with driving ocean transport rates down.

It is unclear whether Maersk was able to capture additional market share with their larger and likely more efficient mega-ships by driving less efficient operators out of business, or if the recession killed off their competitors. What is certain is that Maersk’s pricing strategy merely accelerated the “deflationary” climate experienced across the globe over the past several years, as companies have rushed to cut prices in an attempt to put competitors (who have survived this far thanks to global ZIRP policies which have pushed debt to unprecedented levels around the globe) out of business.

What is also clear is that Maersk is not just making it up. In fact, according to Maersk CEO, Nils Smedegaard Andersen, the reason why companies that are reliant on global trade, such as his, are flailing is simple: global growth is substantially worse than the official numbers and forecasts. To wit: “The world’s economy is growing at a slower pace than the International Monetary Fund and other large forecasters are predicting.”