China’s reported 7.4% GDP growth for 2014 was the lowest in 25 years. But even so, it probably still overstates the true economic position. How could China possibly produce a final fiigure for GDP within just 20 days of 2015? Electricity consumption, as Premier Li has advised in the past, is a far more reliable guide to the actual […]
Tag Archives | China
The world is about to be hit by a demand shock equivalent to 1973′s supply shock. Yet, astonishingly, most commentators remain so focused on central bank activity, that they have completely missed what is happening. Here’s how it is playing out. You may remember the ‘The pH Report‘ forecast in early December that: “Oil prices […]
Welcome to the New Normal. The Great Unwinding of policymaker stimulus has led global oil prices to drop back to $50/bbl. Meanwhile China, the major source of demand growth since 2009, is now seeing a major slowdown. And, of course, this is still only the beginning of the great transformation that is now underway as we enter […]
The chemical industry continues to be the best leading indicator that we have for the global economy. This is because it is not only the 3rd largest industry (after agriculture and energy), but also because it is truly global and impacts virtually all areas of modern-day life. The chart above therefore presents a very downbeat […]
‘How China fooled the world’ was the subject of an excellent BBC documentary early in 2014 by senior editor, Robert Peston. The BBC headline was as follows: “Now, Peston reveals what has actually happened inside China since the economic collapse in the west in 2008. It is a story of spending and investment on a scale never […]
Believing conventional wisdom can destroy your profits. One example is playing out in the oil market before our eyes. Another example is the myth that China was about to become middle class. Yet income levels always made this impossible: More than 9 out of 10 Chinese earn less than $20/day By comparison, the basic state pension in the UK is 25% higher, at over […]
It feels like the end of an era, as we survey the usual quarterly update of chemical company results. For several years, there have been 3 or 4 key dimensions: US companies have been very profitable due to shale gas Asian companies have done well with volume, due to Chinese demand Middle Eastern companies have done well due to […]
Can you imagine your government publishing a report that showed $6.8tn has been wasted in “ineffective investment” in the past 4 years? That is $6.8tn, by the way, not a typo. And it is more than Japan’s total annual GDP, or the combined annual GDP of Germany and France. No, I thought not. I certainly cannot remember […]
I am just back from my first World Economic Forum meeting, having been invited to join its global chemicals council. My first impression was astonishment - at the complete disconnect between the real knowledge of the experts at the Forum and today’s “consensus wisdom” . China is a great example. The external consensus still thinks the new leadership is focused […]
It is now almost 3 months since I suggested the Great Unwinding was about to hit oil and chemical markets. As the chart above shows, there has since been a major collapse in most of the markets in our benchmark portfolio. Given their role as leading indicators for the global economy, this major downturn is extremely worrying: […]
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Paul Hodges is Chairman of International eChem, trusted commercial advisers to the global chemical industry.
The aim of this blog is to share ideas about the influences that may shape the chemical industry over the next 12 – 18 months. It will try to look behind today’s headlines, to understand what may happen next in important issues such oil prices, economic growth and the environment. We may also have some fun, investigating a few of the more offbeat events that take place from time to time. Please do join me and share your thoughts.
Between us, we will hopefully develop useful insights into the key factors that will drive the industry's future performance.