Underlying growth has been slowing since 2000 as more people joined the Perennials generation. Now, the bursting of the central bank stimulus bubbles – combined with the impact of Russia’s invasion – will likely cause the global economy to go ex-growth.
Chemicals and the Economy
Scenario planning key amid volatility
Russia’s invasion is a major wake-up call about the danger of assuming business will always be “as usual”. The window for investing in future growth is starting to close. As Hemingway warned in “Fiesta”, major changes (such as Net Zero) occur “gradually, then suddenly”.
Prepare for a K-shaped recession with Winners & Losers
This is why we are facing a K-shaped recession. Companies and investors have a difficult time ahead. They not only have to navigate a potentially major downturn. But they also have to completely reposition their portfolios for the New Normal world that will follow.
The BoE’s pre-emptive strike is not without risk
The Financial Times has kindly printed my letter below, arguing that it seems the default answer to almost any economic question has now become “more stimulus” from the central bank. After 15 years of subprime lending and then quantitative easing, last week’s warning from the Bank of England suggests there are fewer and fewer economic […]
Investors ponder further shocks after North Korea jolt
Interviewed for this Reuters article, I suggest today’s low levels of market volatility could be “the calm before the storm” Saikat Chatterjee and Vikram Subhedar, AUGUST 11, 2017 / 5:06 PM LONDON (Reuters) – After this week’s war of words between the United States and North Korea triggered the biggest fall in global stocks since the U.S. presidential […]
Investors panic in “search for yield” as interest rates go negative
Its been a great few months for financial markets. All the major markets have seen gains, as the chart shows – something that has happened only once before, since my half-yearly reviews began in March 2009: □ Long-term US Treasury bonds have gained, as long-term interest rates have been falling □ The 30-year bond […]
Stock markets weaken as ‘Ring of Fire’ fault-lines open
“Central banks have created a debt-fuelled ‘Ring of Fire’, and we will no doubt have felt many tremors (large and small) as a result, by the time my next 6-monthly update appears in September“. That was my forecast for world stock markets back in March, and I imagine few would argue with it today, as we review developments […]
Stock market volatility surges as margin debt hits danger level
Global stock markets turned in a vintage experience last week for those who like horror movies. Continued sell-offs in China finally convinced some financial investors, and some senior Western policymakers, that its economy might not be quite as strong as they had assumed. The ensuing panic led to record profits for the high frequency traders (HFTs), as the Dow Jones […]
Contagion hits financial markets as Great Unwinding continues
Crude oil prices continued to fall towards $30/bbl last week. Markets are finally starting to recognise, as the BBC reported last year, that ‘China fooled the world‘ with its stimulus programme. It had not suddenly become middle-class by Western standards in 2009. Instead, aided by developed country stimulus policies, its own stimulus had helped create […]
Global stock markets still depend on low-cost money for support
The blog’s 6-monthly review of global stock markets highlights the narrow nature of the advance since September 2008, when the blog first began analysing developments. It shows their performance since the pre-Crisis peak for each market, and the performance of the US 30-year Treasury bond. Remarkably, only the US, India, Germany and the UK stock markets […]