This time last year, all the cruise lines were hot and heavy about the Med -- even Disney sent a ship. Now, it looks like the place is saturated and the party's over. Well, at least for the cruise lines.

Earlier this week Carnival announced they're pulling Carnival Freedom out of the Med for 2009, citing the strength of pricing in ... the Caribbean. Wasn't the Caribbean the place all good itinerary planners wanted to avoid? The land of bargain-basement fares -- erm, "great value"? Well, now the basement is looking pretty darned good, apparently.

There's definitely a lot of discounting in Europe -- we were shocked to get a mailing from Holland America Line touting $99/day fares in Europe. On HAL. In Europe. $99/day. Aaaagh! (If I didn't have a job and a family, I'd so be on a ship right now.)

Worse, it seems that there's even some -- shhhh -- unsold capacity. Now that's truly frightening. We all know that the marginal cost of a cruise passenger is basically nil. If a cruise line has a cabin, they should sell it at any price rather than let it go empty. After all, there's no additional cost to doing so, and at least people will spend money on booze, shore tours and gratuities.

Even so, we're hearing of ships sailing with empty cabins. That's dire. So far we're not hearing this from the big guys like HAL and Celebrity, but one correspondent recently returned from Azamara Quest reported a 92% occupancy. That's pretty dismal in an industry that typically runs at 100%. Scarier still, another correspondent reported that her recent Windstar cruise on Wind Surf was at 59% capacity -- and they were strongly pushing the back-to-back, as the next sailing was just 50% sold. Now that's just wrong.

Ah well, the world runs by supply and demand. And in the current state of over-supply, now's a great time to pick up a Med cruise for cheap.