Tag Archives | central banks

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Volcker speaks out on central bank policies

Central bankers clearly read too many super-hero comics when they were young. Ben Bernanke at the US Federal Reserve, Mario Draghi at the European Central Bank, Mervyn King at the Bank of England and now Haruhiko Kuroda at the Bank of Japan, all see themselves as Superman solving the world financial crisis. The only problem […]

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Companies warn on Q2 earnings outlook

Traders in Western financial markets are confident of 3 key facts about the economic outlook: • The US is already recovering, with auto and housing markets returning to pre-2008 levels • The Eurozone crisis is almost resolved and recovery is expected by H2 • China’s new leadership will ensure its growth surprises on the upside […]

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Oil markets have lost their price discovery role

The US spent $6bn on its presidential and congressional elections this year. Apart from expressing the will of the people, it may also prove valuable if it helps to highlight the danger of allowing wishful thinking to override factual evidence on the ground. One example of this failing was last Monday’s forecast by the highly-respected […]

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“Those whom the gods wish to destroy…”

Writing over 2000 years ago, the ancient Greek dramatists had a phrase to describe what is happening today in the global economy: ‘Those whom the gods wish to destroy, they first make mad” Central banks have spent the last 4 years, since the Crisis began, handing out free money to their friends in financial markets. […]

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A is for Ambiguity

Today the blog ends its review of the VUCA world with A for Ambiguity. The global economy often seemed to be on auto-pilot during the 25 years of the economic Supercycle between 1982-2007. The chart above shows US GDP since 1929 (when records began), with the pink columns showing the official dates for recession: • […]

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Spain’s economy in “extreme difficulty”

Some things are too ‘obvious’ for highly-paid professionals in the financial world to accept. If life was this simple, then clients might ask why their fees were so high. Therefore they maintain a fiction that what is obvious is not the full story. Interest rates are a classic example of a simple issue which is […]

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Low Western pensions will change demand patterns

Next week, the blog publishes Chapter 5 of its ‘Boom, Gloom and the New Normal’ eBook, co-authored with John Richardson. This looks in detail at the major changes taking place in demand patterns as the BabyBoomers (those born between 1956-70) enter the 55+ age group. This cohort already includes 272 million people, 29% of the […]

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US interest rates turn negative

The irresponsibility of some parts of the global banking system continues to upset the blog. First, there was news that several banks are planning to award themselves huge ‘bonuses’, based largely on their trading success. Yet the money they are using for this trading has mostly been provided by central banks and governments. And it […]

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Germany attacks central bank policy

During the growth years, it became fashionable for politicians to claim that central banks were “independent”. But as the current crisis has grown, this has been increasingly exposed as a myth. As the blog noted back in September 2007, Alan Greenspan (former US Federal Reserve Chairman), revealed that ‘the presumption that we were fully independent […]

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The blog in 2008

The blog is now 18 months old. It has a truly global readership, and as shown in the above map, is now read in 1244 cities and 89 countries. Its aim has always been to identify ‘the influences that may shape the chemical industry over the next 12 – 18 months’, and to ‘develop useful […]

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