“More buyers than sellers” was financier JP Morgan’s famous reply, when being asked why stock prices had risen. The same, of course, is true of inflation. During the 1970s, there were large numbers of Western BabyBoomers, and relatively few older people producing the goods that these young people wanted to consume. So inflation rose sharply, to […]
Chemicals and the Economy
Don’t look down
Governments and central banks never spot recessions till it is too late. Thus after the 2008 Crisis, for example, it was recognised that only a few independent experts such as the blog had forewarned of the danger. Today’s situation seems potentially to be as serious as in 2008. Therefore as promised yesterday, the blog has decided to present its own analysis of the […]
Consensus views on growth, commodity regulation, start to change
In early March, the blog described itself as feeling like “a lonely voice, focused on what is really happening in the real world”. But gradually since then, the consensus view on growth and commodities regulation has begun to shift in its direction. For example, a recent New York Times article on China by Nobel Prize-winner Paul Krugman could have […]
China PE demand grows as food safety worries increase
China’s polyethylene (PE) demand has seen encouraging signs of growth in H1. As the chart above shows (based on Global Trade Information Services data): Total demand is up 13% in 2013 (red column) versus 2011 (blue) Domestic production is up 7%, whilst imports are up 18% The Middle East is the biggest winner, with its sales […]
US housing starts stumble as rental demand weakens
US housing is core to the US economy. And as the US economy is 22% of the global economy, developments in housing matter to all of us. We learnt this during the subprime Crisis, when the blog’s warnings that the supposed boom was an illusion were ignored until too late. Now the same problem is developing again. Thus […]
A $1m US retirement fund will run out for 72% of retirees
The BabyBoomer-led Supercycle of economic growth meant the US suffered just 17 months of recession between 1983-2007. Now populations are ageing, and there is boundless evidence to prove that older people have lower incomes, and also spend less as they already have most of what they need. As a result, historians will likely be amazed when they find […]
Sinopec adapts to the New Normal
The 2013 edition of the blog’s study on Sinopec* is now available, and highlights the changes that are taking place in Sinopec’s focus as the world transitions to the New Normal. Sinopec is China’s leading refining and chemical company, and its original role after 2000 was to support China’s emergence as the manufacturing capital of the world. Today, however, […]
US oil prices rise as housing starts slip and Detroit goes bankrupt
Just as the blog feared, H2 seems to have started badly in terms of demand, and seems likely to get worse. Thus Celanese CEO, Mark Rohr, told investors that in China, “Much of the industrial chemical market there is in turmoil because demand has just not grown.” Whilst Ton Buchner, new CEO of the world’s largest […]
“Is the West more closely resembling Japan?”
Gradually the world’s major investors are recognising that demographics are a key driver for the global economy. They are also becoming more doubtful about the ability of governments and central banks to overcome the challenges of ageing populations. Standard Life, with assets of $275bn, have thus issued a new report which focuses on exactly these issues […]
Aluminium warehouse changes threaten caustic soda sales
Strong aluminium markets have provided great support to caustic soda producers in recent years. PVC and construction markets have been weak, but volumes into aluminium mining have kept prices and overall chloralkali margins strong. Now this may be about to change. As the blog noted in March, aluminium prices have been supported by the behaviour of […]
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