China focuses on domestic growth

In September, the blog wondered whether “China’s interest in remaining the manufacturing capital of the world may be starting to wane”. Yesterday, Lou Jiwei, the chairman of China’s sovereign wealth fund (China Investment Corporation) confirmed the new focus on domestic growth. He suggested that “if China can do a good job domestically, that is the […]

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November US auto sales down 37%

US auto makers today told Congress their “rescue plan” now needs $34bn in support, whilst GM and Chrysler said they need an $11bn loan “just to survive the year”. US sales were down 37% in November, and are at their lowest annual rate since 1982: • GM were down 41% versus 2008 • Ford were […]

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INEOS’ covenant waiver request causes concern

INEOS is the world’s 3rd largest chemicals company. Its €7.29bn debt burden ($9.2bn) means that it is also Europe’s largest issuer of high yield debt. This is an unfortunate combination, given today’s chemical markets. Last month, INEOS was forced to ask its lenders for a waiver on its debt covenants. It offered to pay a […]

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Dow, PIC, finalise K-Dow deal

Foresight, and long-term relationships, have paid off for Dow. Yesterday, CEO Andrew Liveris announced that a binding agreement has now been signed with Kuwait’s PIC to form K-Dow Petrochemicals. PIC will pay $2bn less for their stake than originally agreed a year ago. This represents an exceptionally good outcome for Dow, given what has happened […]

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Dow Jones’ 1st year fall worse than 1929

The chart presents a sobering view of recent stock market performance. It shows (courtesy of chartoftheday.com) the Dow’s performance in the first year of all bear markets since 1900. Since its 2007 peak, the Dow has fallen more than in any other bear market, even more than in 1929.

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US entered recession a year ago – official

Last March, the blog supported Warren Buffett’s statement that “by any commonsense definition, the US is in recession”. I also wrote an article for ICB in April, “Building your defences“, to suggest how companies could develop contingency plans to deal with the “real threat” of recession. At the time, government figures did not support Buffett’s […]

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Saudi Arabia calls for $75/bbl oil

The King of Saudi Arabia is the most important person in the oil industry. He controls the largest oil reserves, and is the largest single producer. Previous Kings have let their Oil Ministers do the talking at OPEC meetings, and to the world’s press. But King Abdullah, who succeeded in 2005, has recently become more […]

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Japan’s industrial output collapses as exports dive

Japan has an ageing population. Since 1990, it has relied on exports to boost its economy. Yesterday, official figures showed industrial production is now being badly affected by the global recession. Output fell 3.1% in October, and a 6.4% decline is expected in November. Observers forecast the September – December period could see an “unprecedented” […]

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Hope for recovery, plan for downturn

Surprisingly, our 7th European conference this week in Cologne (co-organised with ICIS), was one of our most successful. Delegate numbers were down, as companies cut travel budgets. But those attending said they had gained much more, than if they had stayed in the office. For a start, there was the opportunity to share experiences, and […]

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Financial Times recognises the blog

The Queen of England recently asked “Why did nobody see the financial crisis coming?” The Financial Times took the view that “Some did, Ma’am. Some did.” It then initiated a search for these people. Today’s Financial Times now recognises some of those who correctly warned that financial crisis was close. I am sure readers will […]

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