Tag Archives | US $

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Boom/Gloom Index stalls as austerity worries rise

EU policymakers like to pretend that the Eurozone debt crisis was resolved by the adoption of last March’s new Treaty. An even more disturbing thought is that they might even believe their own propaganda. Who knows? But on the ground, it is crystal clear that the problems continue to multiply. Latest data from the Bank […]

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China cuts back lending to the USA

The US government used to depend on China to fund its deficit. In 2006, China bought 47.4% of all US bonds issued. But last year, as the chart from the NY Times shows, China bought just 4.6%, leaving US investors to buy the rest. This is a yet another indicator of the profound changes underway […]

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Floating oil storage increases again

Oil markets are looking increasingly uncertain as we come to year-end. One example of this is a new survey of floating storage by oil brokers, Gibson. This found 42 ships in use, up from the 29 seen in September. Normal levels are just 5 – 7 vessels. Another is OPEC’s weaker discipline on quotas, which […]

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Oil price fall could support the US$

Pity your poor CFO. As well as keeping cashflow positive, they are also coping with major US$ volatility. In July 2008 it was trading at $0.63: €1, but then rose 43% to $.80: €1, before declining 28% to $0.68: €1 today. The catalyst for this volatility seems to be oil price movements. As the chart […]

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‘The biggest bailout in US history’

Does the US Treasury read the blog? Just hours after the chart below was posted, rumours began to circulate of a major government initiative to try and stabilise financial markets.

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Current account deficits start to matter

The US Fed’s decision to keep cutting interest rates is causing a major change in Asian investment behaviour. This will slow world economic growth quite significantly, and is bad news for chemical industry sales. It also means that the informal Bretton Woods II system of currency management has broken down.

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Oil price volatility rises

Volatility has been rising in the crude oil and feedstocks markets. This is because individual players have completely different strategies. In turn, this makes it difficult for chemical companies to forecast short-term feedstock costs. It also makes it difficult to maintain margins. Last Monday, crude reached a new high of $111/bbl. Then, as the scale […]

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The US$ tumbles

The US$ took a major tumble yesterday, as traders decided the Bear Stearns news meant there was little risk of central bank intervention. Against the Japanese yen it fell almost 2.5% during the day, closing at ¥97.35, as shown on the chart. It also fell 2% against the Swiss Franc to SwFr 0.98, and continues […]

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US$ falls below ¥100, crude goes above $110/bbl

The US$ had now fallen through the ¥102 level, which has held since 1995, and went straight to the psychologically important ¥100 level. The dollar peaked 9 months ago at ¥124, and so it has now fallen 19%. This is dramatic by any standards. I forecast back in November that an ‘old-fashioned currency crisis’ could […]

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Buffett says US is in recession

‘If it walks like a duck, and quacks like a duck, then its a duck’. This simple logic probably best sums up Warren Buffett’s position on the current state of the US economy. ‘By any commonsense definition’, said Buffett yesterday, ‘the US is in recession’. Buffett is the world’s leading investor. And key evidence from […]

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