Archive | November, 2011

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Most hedge funds not an “alternative” asset class

Warren Buffett is the world’s most successful investor, earning $62bn from his investments by 2009. But if he had instead channelled this money through hedge funds, and still been equally successful, he would have ended up with just $5bn. They would have taken the other $57bn. Hedge funds have thus been the most successful way […]

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Pensions fall as financial market turmoil continues

Increasing life expectancy is an enormous benefit for today’s population. We can all, whether in developed or developing countries, expect to live a decade or more longer than our grandparents’ generation. Yet pension systems haven’t adapted to this change. The money we now save is still only enough to pay for a few years of […]

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Markets slip in China and Europe

Many investors and policymakers believe that the global economy is just in a ‘soft patch’. They expect a quick recovery early in 2012. This parallels their misguided confidence in Q1 that a strong recovery was underway. But petchem markets, a much more reliable indicator, are suggesting we are at the start of a sustained downturn. […]

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Amsterdam conference highlights megatrends

Attendees heard some very high quality speeches during our annual European Conference in Amsterdam this week. Organised as usual with ICIS, they covered a wide range of critical topics: Patrick Thomas, CEO of Bayer MaterialScience, delivered an inspiring keynote address on Day 1, focusing on the contribution that the petchems industry can make to solve […]

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European ethylene volumes at decade lows

Europe’s cracker operators are heading into a crisis, again, for the 2nd time in 3 years. The chart above, based on official APPE data, compares quarterly ethylene volumes since 2000. It shows: • 2011’s total Q1-Q3 volume of 15.2MT was one of the lowest in the period • Only 2000-1 and 2009 saw lower volumes […]

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Global auto sales growth slows

The blog’s regular look at October’s auto sales in the 3 main markets (China, US, EU) shows growth is slowing, not accelerating. China’s sales were lower than September, as the subsidy ended on small engine cars. Its pace of growth is also slowing. Year to date sales are only up 6% versus 2010, compared to […]

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BabyBoomers change the markets

Consumption dominates chemical demand. Chapter 7 of our new ‘Boom, Gloom and the New Normal’ eBook therefore looks at the changes taking place in consumer markets. These provide vital insight into how chemical markets are likely to develop in the New Normal. The key learning is that companies are re-adapting their business models. The great […]

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Policy makers talk, whilst markets weaken

Petchem markets are telling us something very important about the state of the global economy. They are doing their usual job as leading indicators. Prices for all 4 of the blog’s benchmark products are now down over 20% since it launched the IeC Downturn Monitor at the end of April. The OECD’s leading indicators also […]

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EU auto sales hit new lows

Autos are now the single biggest market for petchem sales. They are also reported very quickly. So October’s EU auto sales provide the best real-time picture of the downturn now underway. As the chart shows: • October’s sales (red square) were the lowest in recent years • Total sales since January are also the lowest […]

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US farmland enters the New Normal

The downturn in the US housing market is turning out to have a silver lining, according to the Wall Street Journal. It describes how farmers in some areas are now able to buy back land previously sold for housing development, and return it to agricultural use: • Residential land value has fallen 70% since the […]

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