By John Richardson THERE is a very common view out there that the ethylene cycle will tighten from next year until around 2019, when the big flood of new US capacity is expected to hit the market. This is supported by the thinking that: The global economy will get stronger, rather than weaker, next year. […]
Asian Chemical Connections
Want To Keep Your Job? What To Tell Your Boss
By John Richardson THE economic data on China was very useful yesterday if you had already gone long on oil or US equities. Both crude and the S&P 500 rallied on positive interpretations of Q3 GDP and industrial production data, which included the following: “China’s gross domestic product increased by 7.3% in the third quarter, […]
No Other Choice But To Tackle “Group Thinking”
By John Richardson WE are proud to work with Paul Hodges, chairman of the UK-based chemicals company, International eChem, who in this superb FT Beyondbrics blog post, provides the kind of “connect the dots” top-down vision of the global economy that is all too rare out there. Someone else that we highly rate is Gillian […]
China: How To Chart The Future
By John Richardson THE chart below should not be printed out and pinned on any chemicals company boardroom wall. If you accidentally press the “print” button, you must throw the print-out in the bin, without pause, just in case somebody happens to walk past the office printer and think it important or relevant. Here is […]
Oil Prices: Ignore Human Nature At Your Peril
By John Richardson JUST four months after the blog first moved to Asia, we got the shock of our lives: The Asian Financial Crisis. We were bewildered and didn’t know what to think, but fortunately, perhaps, there wasn’t much of an Internet in those days. So we had smaller mountains of news and analysis to […]
China: The Future Winners And Losers
By John Richardson CONVENTIONAL analysis, which assumes that the world of the last six years will be the world of the next six years, is failing. One of the most obvious examples of this is China, where one-dimensional, lack-of-depth conventional thinking still maintains that the rise of the country’s “middle classes” will result in a […]
Want Oil Prices Back At Above $1OO? Be Careful What You Wish For
By John Richardson WE worry that quite a few people still don’t get it on crude oil. Here is why: As recently as July, as the chart above from the latest BP Energy Review shows, oil prices were from 2009 until July of last year were close to costing 5% of global GDP. At this […]
As Easy Money Ends, Time To Unblock The Plughole
By John Richardson YOU cannot fix a blocked plughole by pouring in more water. This is the core message of this very important FT Alphaville blog post, which tells us that: While Western central banks have done their best to stimulate new credit creation, a lack of good-enough returns from the real economy means that […]
Oil Prices at $50 or $150 In 2015? Take Your Pick
By John Richardson REAL price discovery is finally returning to oil markets after years of incredibly harmful central bank stimulus which put the market largely in the hands of the speculators. But now actual supply of and demand for oil suddenly matter again as central bank stimulus is withdrawn in the US and in China. […]
Oil Markets: The Failure Of Accepted Wisdom
By John Richardson THE illusion of a strong global economy has been created by central bank stimulus – via the Fed and, much more importantly, via China. And the illusion of a strong global economy was accompanied by the “illusion of scarcity” in crude oil, when, in fact, inventories have been high for years as […]