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Local buyers priced out of London housing market

Most people, if they are lucky, never get to see a property bubble during their lives.  But those of us alive today have seen two distinct types of bubble in action: The first has been the Ponzi-type bubble sponsored by government lending policies, as seen in the subprime era and now in China.  These take […]

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UK tinkers with higher pension ages, ignores impact on GDP

Many readers have asked to see how the UK economy is being impacted by its ageing population, following the blog’s December series on the US, China, Japan, Germany and France.  As the chart shows, it is in a very similar position to all of these countries: Life expectancy has increased by 17% to 81 years today, from […]

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US housing recovery stalls as Boomers head for retirement

“Recent economic reports suggest a bleaker picture for housing…. Some of the weakness reflects the cold weather in much of the country. However, higher home prices and mortgage rates are taking a toll on affordability.” This was the sober report yesterday from the chairman of the authoritative S&P Case-Shiller Home Price Index, adding that “the strongest part […]

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China’s rural areas need basic goods, environmental clean-up

Average incomes in China are very low by Western standards, and certainly not “middle-class” as the blog discussed yesterday.  It is also easy to forget that almost half the population still lives in rural areas.  Official data shows their incomes have shown major growth over the past 20 years, but are still less than a third of urban incomes today. The chart […]

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China’s urban consumers depend on property ‘wealth effect’

One of the great myths of modern times is that China is now full of middle class people with Western levels of consumption.  Nothing could be further from the truth. Annual per capita incomes have certainly soared over the past two decades.  But the main impact has been to lift people out of absolute poverty, […]

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Adapting to the ageing baby boomers

The blog’s latest post for the Financial Times FT Data blog is below. February 13, 2014 2:22 pm by FT Two remarkable global demographic developments have occurred since 1950. Yet only recently have their impact on companies and the economy begun to be properly understood. Life expectancy has risen by 50 per cent since 1950 […]

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Who will finance the debt rollovers and new US ethylene crackers?

A blog reader has kindly forwarded an interesting paper from AT Kearney, which looks at the amount of debt due to be refinanced in the chemical industry over the next 5 years.  As ATK note: “The restructuring and debt buildup that occurred in the chemicals industry from 2006 - 2008 was extraordinary—more than $330bn in deals […]

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Lanxess CEO departs as auto markets enter the New Normal

The blog, like most people, doesn’t like change.  Change creates uncertainty, and makes us all nervous.  Thus in recent years it has privately hoped that its forecasts about (a) the inevitability of the subprime crisis and (b) the transition to the New Normal, would prove wrong.  Life would be so much easier if nothing changed. Thus it is distressed to see developments at […]

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US housing starts show few signs of major recovery

Optimism over the outlook for the US housing market has formed a key part of the global economic Recovery Scenario in recent months, as housing used to be one of the main supports for the economy: During the BabyBoomer SuperCycle, large numbers of new houses were required to house the Boomers as they settled down and […]

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Global auto industry sales growth depends on China

Autos remain the world’s largest manufacturing industry, and the single biggest source of demand for chemicals and plastics.  According to detailed analysis by the American Chemistry Council, each new US auto is worth $3,539 in terms of sales – and involves a wide range of products including antifreeze, plastic dashboards, bumpers and windows, as well as upholstery […]

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