By John Richardson YOU should be getting that strong feeling that history might be about to repeat itself when you look at the January-February data on China’s petrochemicals markets. In polypropylene (PP), polyethylene, styrene, mono-ethylene glycol, phenol and acetone, the ICIS reading of China Customs data indicates big year-on-year increases in imports – way ahead of what the […]
Asian Chemical Connections
Global Deflation At Risk Of Returning On End Of China Commodities Bubble
By John Richardson THIS time last year it was deflation that seemed to be the problem for the global economy. Despite many years of US Federal Reserve, European Central Bank (ECB) and Bank of England (BOE) etc. economic stimulus, consumer and producer prices had stubbornly refused to respond in the way that most of the […]
Oil Prices Could Fall By 50% On Demand As Well As Supply Realities
By John Richardson THE REAL crude-oil supply story is becoming more commonly understood – hence, the recent declines in pricing. As I discussed in early March, before oil prices started heading south again, supply has been long for a substantial length of time. It is just that speculators chose to view the data in a different way as they […]
Shift In Lending Patterns Indicate Slower 2017 China Growth
By John Richardson WE HAVE now seen two months of a very important shift in the pattern of credit growth in China: In January, new local-currency bank loans were Rmb2.13 trillion ($310bn).. This was far above December’s Rmb994bn, but there is always a big seasonal surge in lending every January. Crucially, this January’s figure was below the Rmb2.54 trillion during the […]
China Credit And Economic Growth To Slow Again
By John Richardson Since early 2014, China’s economic history has been one of start, stop reforms. First of all, President Xi Jinping (pictured right) was in control as his “Princeling” political faction began to effectively implement the bold reform vision outlined in late 2013 at the pivotal 3rd Plenum Meeting of China’s top politicians. The Princelings […]
Tackling China’s Latest Steel Bubble: Implications For Petrochemicals
Note: A technical fault meant I was unable to update the blog on Wednesday and Friday last week. Business as usual returns this week. By John Richardson THE stop, start nature of economic reforms in China, which is the result of the battle between the reforming “princeling” politicians and the “populists” who want to maintain the status […]
China And US: Different Approach To Same Challenge Risks Only One Winner
By John Richardson WHAT do Xi Jinping and Donald Trump have in common? Both confront the challenge of income inequality. President Xi’s approach is centred on the One Belt, One Road initiative, which involves an attempt to create the world’s biggest free-trade zone involving more than 65 countries. Meanwhile, President Trump is moving in completely the opposite direction. President Xi hopes that: […]
China: 2017-2020 Scenarios For Polypropylene Growth
By John Richardson IS this the moment when Xi Jinping decides to take most of the pain of economic reforms? A recent article in Caixin, the Chinese business and finance magazine, suggests that the moment could have arrived: This week, the Ministry of Finance and the China Banking Regulatory Commission issued a new policy requiring […]
Why China Cannot Get Away With Its Latest Debt Crisis
By John Richardson CHINA has had debt crises before that have been very easily resolved. In the late 1990s, for instance, as business and economics professor, Christopher Balding, points out, China’s government created state-owned asset management companies to clean-up the balance sheets of banks. These management companies bought debt off troubled banks and held it […]
China’s Latest Real Estate Bubble And The Lessons Of History
By John Richardson ARE you still playing catch-up on China as events once again take what you think are an entirely unexpected turn? If so, you haven’t learned the lessons of the last three years. In late 2013, after the critically important Third Plenum meeting of China’s top political leaders, it was crystal clear that […]
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