Another month, and another downturn in the European car market. It was the largest regional market in the world as recently as 2009, when 13.3m cars were sold But as the chart shows. May (red square) saw sales down 9% versus 2011 (green line). This is the 8th consecutive month in which sales have fallen. […]
Chemicals and the Economy
China’s auto dealers run for cash, not profit
China’s auto sales picked up in May at 1.18m. This was the highest-ever sales rate in May, and meant 2012 sales are now up 5% versus 2011 (green line). Beneath the surface, however, China’s Automobile Dealers Association reported that inventories of new cars continue to build. They now average a record 2 months, versus 45 […]
Average age of US auto fleet at record 11.1 years
US auto sales maintained a steady pace in May. As the chart shows (red square), they were 1.3m in the month, and are now up 13% versus 2011 (green line). The key driver remains the need to replace old vehicles. It is impossible to work or shop in many parts of the US without a […]
US companies have less cash to spend
The US Federal Reserve has provided a wonderful new example of the problems with spreadsheets. It also shows how a naive belief in the credibility of any computer-generated output has come to over-ride common sense. In turn, policy can become based on myth, rather than reality. The chart above from the Wall Street Journal shows […]
“A failure to stay ahead of events”
Petchem markets are doing an excellent job in their role as a leading indicator for the global economy. But as we warn in Boom, Gloom and the New Normal, policymakers remain in Denial about their message. The chart above spells it out clearly. Volume leads pricing. Since January, China’s demand growth has collapsed. So its […]
If you build it, they may not come
The story of the 1989 US movie Field of Dreams summed up the happy days of the economic supercycle that was then getting underway. Starring A-list players such as Kevin Costner and Burt Lancaster, its theme that “if you build it, they will come” came to define the era. In the world of manufacturing, companies […]
Austerity levels jump
The blog’s Boom/Gloom Index (blue column) reaches its 3rd anniversary this month. It was introduced to help monitor sentiment in financial markets, on the basis that “many markets are clearly being ruled by sentiment”. It has since done a good job in identifying peaks and troughs: • Peaks have been focused on periods when central […]
Oil markets break out of their ‘triangle’
There has never been any fundamental basis for the rise in oil prices over the past 3 years: • At no time has there been any actual shortage of product • In fact, inventories have always been at comfortable levels They rose only for two reasons: • The investment banks found they could make a […]
A Call to Action
We are about to set out on a great journey as the world transitions to the New Normal. The reason for the journey is that the world economy has changed irrevocably as a result of the financial crisis and the demand changes created by the aging of the Western BabyBoomers. There is no going back. […]
What goes up, comes down
Don’t panic is the blog’s suggestion, after last week’s market collapse. Instead, the important thing is to plan for what might happen next. Scenario planning is absolutely critical to survival over coming months. The blog’s advice is to assemble your management team as quickly as possible, and ask everyone to come prepared to be honest […]
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