Resilience requires companies to refocus downstream and diversify their portfolio. They also need to be clear about the value proposition for their target market – are they providing Value, or Luxury? Rethinking, repositioning and restructuring are now all key to survival and future profit.
Chemicals and the Economy
Demographics are destiny: today’s ageing populations creating “replacement economy”
Demographics are taking demand patterns in completely new directions. Sustaining future growth now depends on successfully developing and implementing new policies, focused on the opportunities offered by the emergence of the Perennials 55+ cohort. Demographics are taking demand patterns in completely new directions. Sustaining future growth now depends on successfully developing and implementing new policies, focused on the opportunities offered by the emergence of the Perennials 55+ cohort.
Demographics are destiny for the global economy, as central banks start to realise
For the past 15 years, since the Global Financial Crisis, central banks have claimed they could generate demand and economic growth via stimulus. Some $73tn of spending later, it is finally becoming clear to some of them, at least, that they can’t.
Now, we all have to start picking up the pieces of the problems they have created.
Investors hope (again) for interest rate cuts and a ‘Santa Claus rally’
investors are hoping Fed Chairman Jay Powell will soon signal a dramatic interest rate cut. And so they are positioning for a ‘Santa Claus’ rally. But most adults know that Santa Claus doesn’t really exist.
Central banks start to lose control of interest rates, and housing markets feel the pain
US 10-year interest rates are the world’s benchmark “risk-free” market. And as the chart shows, their yield has risen from 3.25% on 4 June to peak at 4.88% on Friday. Prices move inversely to yield. So that means prices have fallen 50% in 4 months.
Companies must be bold and transform, as paradigm shifts reshape the business world
The paradigm shifts are already starting to impact most businesses. China is also changing, and will no longer power global growth. So there are no ‘Business as Usual’ options for the future. Instead, companies have to develop new business models for today’s New Normal world.
Bond market downturn reaches “The End of the Beginning” as traders realise rates will be ‘higher for longer’
300+ years of Bank of England data shows that interest rates are typically inflation plus 2.5%. At today’s level, this would imply – US rates would be 3.7% + 2.5% = 6.2%: Japan would be 3.2% + 2.5% = 5.7%: Eurozone rates would be 5.3% + 2.5% = 7.8%; UK rates would be 6.7% + 2.5% = 9.2%
Asia’s debt crisis edges nearer, as Japan’s interest rates rise and China’s property bubble bursts
Bubbles are great fun while they last. But they are much less fun when they burst. For the past 20 years, central bank stimulus has created some of the largest bubbles ever seen. But now, led by developments in Japan and China, they are bursting
Central banks leak $bns as losses from their stimulus policies start to soar
The losses sitting on central bank balance sheets are starting to soar to eye-watering levels. The US Federal Reserve is sitting on a “mark-to-market” loss of $911bn. The UK taxpayer has already handed over £150bn ($192bn) to cover the Bank of England’s losses.
Chemicals confirm deflationary pressures are building around the world
Taylor Swift’s concerts are creating massive short-term demand as people reconnect after lockdowns. But the chemical industry is warning that deflation could be round the corner, due to the over-capacity created by 20 years of stimulus