Tag Archives | China

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“A real global downturn in the industrial sector”

There are mounting signs that 2010 could prove a Year of 2 Halves in terms of economic growth. Interviewed by Bloomberg last month, the MD of the Economic Cycle Research Institute (ECRI), Lakshman Achuthan, warned that their indicators showed “A real global downturn in the industrial sector is starting right here and right now“. They […]

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China’s auto and housing markets weaken

“There are 64.5 million empty apartments and houses in China’s urban areas“, according to Barrons, the US investment magazine. The figure comes from a survey of the country’s electricity meters, undertaken by China’s Academy of Social Sciences. To date, China’s homebuyers remain convinced that home prices cannot fall, as shown by their willingness last year […]

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Honam’s Malaysia buy opens SEA market share battle

Over-capacity is going to be a major issue for the petchem industry over the next few years. Asian producers, in particular, are likely to be worst impacted. The reason is that they have relied on exports to China taking up to 50% of their production. But now China’s own production is ramping up, reducing the […]

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China’s economy flashes an amber light

China’s chemical demand is clearly starting to slow, as my fellow blogger John Richardson has been reporting recently. This has big implications for the global chemical industry, which has relied on China to balance declining sales in the West. The slowdown comes as the government rolls back the stimulus measures introduced in Q4 2008, when […]

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BASF’s Hambrecht hits at China’s business policies

The business climate for Western firms in China is getting worse. 2 weeks ago, the CEO of General Electric, Jeffrey Immelt, caused a stir when he told a private dinner that “I really worry about China. I am not sure that in the end they want any of us to win, or any of us […]

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A Year of Two Halves

Two months ago, on 8 May, the blog suggested that ‘Sell in May and Go Away” was likely to prove good advice this year. Since then, most major stock markets have fallen dramatically, with the S&P 500 down by 9%. The proximate cause of the blog’s pessimism then was the onset of the Greek/eurozone crisis. […]

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General Electric’s CEO hits at China, Obama

When things are going well, potential problem areas get brushed under the carpet. Its only when the economy gets difficult, that tensions surface. Comments by General Electric CEO, Jeffrey Immelt, reported today by the Financial Times, are therefore a worrying sign of the uncertainty at the top of leading global businesses about the economic outlook. […]

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China’s slowdown hits shipping market

The Baltic Dry Index of freight costs (for iron ore, grains and coal) follows changes in global demand for bulk shipping. As such, it is an important leading indicator of future economic activity, and chemicals demand. The blog first noted Index movements in October 2007, when this was accurately forecasting the H1 2008 boom. In […]

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China’s petchem volume surge will hit imports, as electricity consumption/bank lending data shows economy’s growth starting to slow

The above chart is the blog’s best effort to correlate the change in China’s bank lending with the real economy. It shows electricity consumption (blue line) and lending (red column) since July 2008. Electricity consumption is an excellent proxy for the real economy, and probably more reliable than GDP figures, which are widely believed to […]

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China focuses on domestic issues, risks US anger

China is a very difficult country for foreigners to understand. The blog suspects that the best approach is to apply Winston Churchill’s insight on Russia, namely “I cannot forecast to you the action of Russia. It is a riddle, wrapped in a mystery, inside an enigma; but perhaps there is a key. That key is […]

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