Tag Archives | US Federal Reserve

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Crude oil continues to trade in its ‘Triangle’

An unnatural calm continues to dominate crude oil trading. Prices may move up or down by $2/bbl or $3/bbl a day, but then they always return to where they started, between the upper red line and the lower green one. The blog has kept its promised eye on developments, since this trend of ‘trading in […]

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USA aims “to inflate the rest of the world”

If you only read one newspaper article this year on the economic outlook, then the blog would recommend Martin Wolf’s recent analysis ‘Why America is going to win the global currency battle’. Wolf is a former EPCA speaker, and he sets out very convincingly the rationale for the US Federal Reserve’s planned move to restart […]

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Markets anticipate the QE2 ‘Lifeboat Party’

Warren Buffett, the legendary US investor once cautioned that “over time, markets will do extraordinary, even bizarre, things.” We are certainly living through such times today. In August, the US S&P 500 Index fell 5%, as investors worried about the end of stimulus packages, and the return of banking problems in Europe. The IeC Boom/Gloom […]

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The Great Disappointment follows the Great Recession

The good news this week was that the body responsible for dating US recessions, the National Bureau of Economic Research, finally declared that the so-called Great Recession was over. It was the longest since the Depression, running from December 2007 to June 2009, and twice as deep as in 1981-2, causing a 4% loss in […]

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US junk bond issue hits record as GDP slows

As noted by a blog reader last week, retail investors are throwing caution to the winds. Unwilling, or unable, to adjust their lifestyles to cope with lower interest rates on government bonds, they have rushed to instead buy higher-yielding ‘junk bonds’. These are less than normal ‘investment’ grade, and offer increased yield in exchange for […]

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Deflation a real risk for the 2011 Budget period

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 […]

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Fed, American Chemistry Council, worry about US economy

The US Federal Reserve and the American Chemistry Council (ACC) have joined the blog in expressing concern about the outlook for the US economy. And as the chart above of the US S&P 500 shows, financial markets have continued to weaken since the blog’s advice on 8 May to “sell in May and go away“. […]

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Volcker calls for meaningful financial reform

Paul Volcker was the last US Federal Reserve chairman who believed that a key part of its role was “to take away the punchbowl just when the party starts getting interesting“. He successfully brought inflation back to single figures during the 1980′s downturn, setting the scene for the major economic recovery that followed. Now head […]

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US unemployment rate now 10.2%

The US accounts for 23% of global GDP. Its economy is 3 times larger than the No 2 country, Japan. And most critically for the chemical industry, 70% of US GDP is consumer-based. Developments in US housing/construction, auto and electronics industries are therefore the biggest single influence on global chemical sales. In turn, the level […]

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Housing markets to be slow next year, US Fed

In 2006, there were 2.2 million US housing starts. These were worth $35bn of chemical sales. Currently, and even with the support of an $8k tax credit, they are running at an annual rate of just 600k, worth $10bn. This is the lowest level since records began in 1960. Even in 1975, 1981 and 1981, […]

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