Financial markets continued their start of quarter rally last week. But their volatility amazes even seasoned observers. The US Dow Jones Index has moved at least 100 points in 57 of the last 58 days, for example, whilst crude oil jumped $3/bbl on Friday alone. Of course, the continued correlation between stock and oil markets […]
Chemicals and the Economy
2012 Budgets
The blog will publish its fifth annual Budget Outlook next weekend. As usual, it is therefore time to review last year’s Outlook. Past performance may not be a perfect guide to future outcomes. But it is one of the best that we have. The blog’s 2008 Outlook ‘Budgeting for a Downturn’, and its 2009 ‘Budgeting […]
Time to confront reality
Peggy Noonan is the blog’s favourite political correspondent. She used to be President Reagan’s speechwriter, so nobody can accuse her of being a ‘socialist’ or ‘doomsayer’. Recently, she has been writing some very important columns in the Wall Street Journal about what is wrong in America, and what needs to be done to put it […]
Politics, beliefs return to dominate economics
The 10000 readers who downloaded the blog’s first Budget White Paper in December 2009, ‘Budgeting for a New Normal’, will remember the issues highlighted in the triangle above. At the time, they were being widely ignored, as policymakers assumed that the economy would soon return to its previous SuperCycle. Today, this optimism has been revealed […]
Global oil bill now 5% of GDP
The world has suffered a recession every time the oil price has reached current levels. And as the blog has warned for months, this time is unlikely to be different. The reason is captured in the above chart. This uses: • Oil production since 1970 as reported in BP’s annual review • Average annual oil […]
US auto sales remain flat
The good news about US auto sales last month was that they were the highest September sales since 2007. The bad news was that they were still below the 1.1 million level, which was the minimum monthly sale from 2005 – August 2008. The reasons for the slight increase in sales were also quite prosaic. […]
Groundhog Day again as Quarter 4 starts
The great film comedy Groundhog Day saw Bill Murray doomed to repeat the same day in his life, until he learnt to become a better person. Sadly, financial markets have yet to learn from his example. Every quarter, the investment banks produce new stories aimed at pushing stock/oil markets higher. Then high-frequency traders make $millions […]
EPCA attendees worry about China slowdown
China was understandably a key item on most people’s minds at this week’s annual EPCA (European Petrochemical Association) meeting in Berlin. It has been the motor of global chemical demand growth over the past 3 years. The blog’s discussions identified a number of signs that this support may be disappearing: • Many companies worry about […]
Critical Success Factors in the New Normal
Yesterday’s Scenarios hopefully provided valuable insight into the challenges ahead for companies and individuals. They also suggest some Critical Success Factors for achieving a successful transition to the New Normal, as set out in the chart above: 1. Flexibility. This involves adapting to new circumstances and being willing to compromise rather than battling for an […]
Scenarios for the transition to the New Normal
The transition to the new Normal is likely to be painful and long-lasting. Future demand growth will be slower as the ageing Boomers spend less and save more. More regular and deeper recessions are likely to become a feature of the global economy once more, in contrast to the relatively smooth growth seen during the […]
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