The Western BabyBoomers (born between 1946-70), have been one of the luckiest generations in history. By and large, they have escaped the major wars that have plagued society down the ages. They have also lived in a world where living standards and material wealth have made astonishing gains. Equally priceless has been the rise in […]
Chemicals and the Economy
Boom/Gloom Index suggests volatile August may lie ahead
It may be an idea to keep your smartphone charged and within reach, if you are planning a trip to the beach this month. Certainly market behaviour since June has been more and more skittish. The experts, after all, were telling us that central banks were certain to do more major stimulus efforts to boost […]
13m missing American workers highlight economic slowdown
There’s something very wrong with the US jobs market, as the slide above confirms. Commentators professed to be surprised by the disappointing May report last Friday, but its hard to know why: The overall participation rate has been in decline since July 1997, when it reached 68%: today it is only 62.7% Male participation is at […]
Surplus chemical industry capacity reaches 26% as demand slows
Global demand is continuing to slow, yet chemical industry capacity is continuing to ramp up. As a result, supply gluts are likely to appear in many key areas as we move into the second half of the year. That is the key conclusion from the latest American Chemistry Council data for global chemical capacity and […]
Restocking boosts Q1 margins for chemical companies
Thank goodness for Janet Yellen, and China’s provincial governments. That was clearly investors’ thoughts, when they bid up chemical company share prices during Q1. For as the chart above shows, there was nothing in the fundamentals of supply and demand to suggest economic recovery was finally underway. Instead, the latest American Chemistry Council data shows […]
Oil market speculators profit as central banks hand out free cash
Oil markets are entering a very dangerous phase. Already, many US energy companies have gone bankrupt, having believed that $100/bbl prices would justify their drilling costs. Now the pain is moving downstream. The problem is the central banks. Hedge funds have piled into the oil futures markets since January, betting that there would be lots […]
“Debt-financed growth model has reached its limits”, admits German finance minister
Central bank policy-making is becoming more and more dysfunctional, as German Finance Minister Wolfgang Schäuble‘s comments highlighted on Friday: “The debt financed growth model has reached its limits. It is even causing new problems, raising debt, causing bubbles and excessive risk taking, zombifying the economy….and may have laid the foundation for the next crisis.” One clear sign […]
If only the central banks could print babies
The Financial Times has kindly printed my letter below, arguing that central bank stimulus can’t restore growth to previous Super Cycle levels. Sir, John Plender’s excellent analysis “Central banks’ waning credibility is the real threat to confidence” (Insight, February 17) highlights the need for a new narrative to explain the economic slowdown of recent years. […]
Great Unwinding sees oil fall 65%; US$ rise 22%; US 10-year rates rise 25%
The Great Unwinding of policymaker stimulus was the major issue in financial markets in 2015. And it is set to have even greater impact in 2016 once Phase 3 begins. The chart above highlights the astonishing changes that have taken place since the Unwinding began in mid-August 2014; Phase 1 has so far seen Brent […]
US 10-year interest rates jump 23% as Fed debates 0.25% hike
Media hype over the potential for a 0.25% interest rate rise by the US Federal Reserve is well underway. But as often happens these days, this is missing the bigger picture. The issue is simple: developments in China are far more important to the global economy than anything the Fed might, or might not, do […]
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