The blog has been revisiting the Bank of England’s 2008 analysis of the likely impact of the financial Crisis. This reviewed 33 banking crises between 1977-2002 and found that: • The average length of each crisis was 4.3 years • The median loss of GDP was 7.1% • Major crises (such as today’s) caused GDP […]
Tag Archives | deflation
The blog is a great fan of Pimco, the world’s largest bond fund managers. They were the first people to spot the housing bust developing in the USA, and to suggest the scale of the damage it might cause. More recently, they have pioneered the concept of the ‘new normal’. Thus a new analysis by […]
When the G-20 met in London in April 2009, they produced a Communiqué containing just 688 words. And as the blog noted in conclusion, there was “no sign of a ‘Plan B’ being developed“, in case the Stimulus measures failed to work. This was still the case last September in Pittsburgh, when the Leader’s Statement […]
The blog remains amazed, and worried, by the inability of many of those reponsible for the global financial system to provide the necesary leadership during the current Crisis. They seemingly failed to grasp in March 2008 that Bear Stearns’ bankruptcy was a clear sign that a major global financial crisis was around the corner. Equally, […]
Wal-Mart, the world’s largest retailer with $400bn sales, saw deflation in its core US market last quarter. Prices were down minus 1.6%, even more than the -1% forecast. The cause was lack of confidence amongst shoppers, many of whom are now living “paycheck to paycheck”. The major retailers have an excellent record as forecasters of […]
Q3 comments from Tesco, the world’s 3rd largest retailer, confirm the picture of a more frugal consumer suggested by other majors. On the positive side, they report “a material improvement” in sales “in both Asia and Europe“. And Tesco expect “this trend to continue into Q4 and beyond”. But on the less positive side, CFO […]
The blog regards Wal-Mart and other major retailers as excellent leading indicators of trends in the wider economy. It was therefore concerned to see CFO Tom Schoewe reporting today that Wal-Mart continues to “operate in a very challenging economy“, where the key driver is to provide “the lowest prices to our customers around the world.” […]
China will pump loans worth $1.3trn into its economy this year, equal to 1/3rd of GDP. Equally, by tying the yuan to the US$, China has achieved a major devaluation against major currencies such as the euro. The result has been that China’s Q3 GDP rose less in “nominal” terms than in “real” terms. Normally […]
The blog’s favourite financial journalist, Gillian Tett, has written an excellent article summarising the similarities between today’s problems in the western banking system, and those of Japan’s during the ‘lost decade’ of the 1990′s. Her point is that although central banks are pouring money into the system via ‘quantitative easing’, it is clearly not reaching […]
Parts of Europe are now following the US lead and seeing deflation. Spain saw prices fell 0.1% last month, for the first time since records began in 1961. In the UK, the retail prices index fell 0.4%, to register the first decline since 1959. Prices have also fallen in Portugal, Ireland and Luxembourg Economists have […]
FREE TRIAL TO ICIS NEWS
LATEST CHEMICAL INDUSTRY NEWS
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.