Last week saw new Bank of England governor, Mark Carney, follow the lead of US Fed Chairman Ben Bernanke on trying to deliver a ‘quick fix’ for the economy by boosting asset prices – particularly house prices and stock market levels. But as the Bank of England chart shows, this means trying to return the ratio of house prices to earnings back […]
Chemicals and the Economy
US PE exports up just 11% versus 2011, as focus shifts to Latin America
H1 trade date from leading provider Global Trade Information Services highlights a surprisingly weak overall export performance by US polyethylene (PE) producers. As the chart shows: Net export volumes (blue column) have recovered from the 2012 slowdown (green), but are still only up 11% versus 2011 (red) Volume is currently heavily reliant on sales into Latin […]
China revises down H1 auto sales by 9%
China’s state media have published major revisions to reported auto sales data for H1, and for the equivalent period in 2012. As far as the blog knows, these have not been noticed elsewhere, so it seems worth providing more detail on the changes that have been made. Auto sales are a vitally important market, and these changes are quite significant, […]
Earnings disappoint again, as companies face challenge of slowing global growth
Most of today’s executives and policymakers grew up during the SuperCycle. Many therefore continue to believe that a return to constant growth is somehow inevitable. Sadly, of course, they are doomed to disappointment. And disappointment is the predominant message from the blog’s usual quarterly review of company results. Thus BASF note that “achieving our earnings target […]
Markets in wait-and-see mode as holiday season arrives
Markets have moved into summer holiday mode in recent weeks whilst they wait for a new direction, as the chart shows. It is therefore timely to look back over developments since the start of the year: The S&P 500 (purple) has been the clear winner, up 15%. The key to its out-performance has been the central […]
US stock markets hit record but real economy remains slow
“Don’t fight the Fed” is one of the oldest rules in stock market investment. And it has proved valid again, as this month’s IeC Boom/Gloom Index shows: The Fed and other G7 central banks have poured $10tn of stimulus into financial markets since 2008 This cash has finally taken the S&P 500 (red line) into record territory Critical to this […]
Australia’s tax revenue forecast dives A$33bn in 10 weeks on China slowdown
How has your company reacted to the clear signals from China’s new leadership that they intend to take the economy on a new path? Has it updated its existing contingency plan, and warned employees and shareholders that things may get very tough for a few years? If not, why not? Even companies who don’t trade directly with China […]
US employment growth, disposable income, weaken again
June has typically been the seasonal peak for US employment. July’s data continued this trend, as the chart shows: The July figure was 135.6m, compared to 136.8m in June (blue column) It is still well below 2007’s peak of 139.1m This is the first time jobs have been lower over a 4 year period since records began in […]
Key China data suggest economic growth already less than 5%
China’s economy is continuing to slow, as the new leadership takes power. As the chart shows of H1 performance: Electricity consumption (red line) was up 5% versus H1 2012 Bank lending was up 4% These levels are of course well below the published GDP figure of 7.5% for Q2, but the two types of data […]
US GDP grows just 1.7% in Q2
“The big picture remains unchanged. Four years after the recession officially ended, per capita output and income have yet to return to their pre-crisis highs. The recovery still ranks as the worst since World War II. And despite the modest acceleration in the past two quarters, the recovery shows little sign of gaining momentum.” The […]