Kevin Swift at the American Chemistry Council issued a new 2009 Outlook this week. His analysis suggests that we will see a V-shaped recession, as the “massive stimulus being injected into the US and other world economies will foster demand and a virtuous cycle of recovery will engage”. His optimism is very welcome, given the dire news this week from US housing markets, which are so critical to chemical sales.
The chart above, from the excellent weekly ACC report, shows that new home sales in January were down 48% versus 2008. New home inventories also rose to 13.3 months, which will no doubt lead to further cutbacks in housing starts. Meanwhile the S&P Case-Shiller house price index fell for the 29th successive month, with “all 20 metro areas reporting annual declines”.