“Conventional wisdom” never spotted the imminent arrival of the Great Unwinding. Sadly, therefore, the past 3 months have often been a repeat of 2008 for many businesses and investors. Many executives and investors clearly understood and accepted the logic of my August forecast that oil prices would collapse and the US$ strengthen. But sadly, once again, most found it impossible to act […]
Chemicals and the Economy
Oil price collapse, US$ rise confirm Great Unwinding underway
Stock markets are floating ever higher on an ocean of central bank money printing. But something else is happening in the real world where we all live and work. Since August, I have been warning that the Great Unwinding of this policymaker stimulus is now underway. The chart above highlights how my 2 core forecasts have now been confirmed: Brent Oil […]
China plans $90bn spend on new “Silk Roads”
I am just back from my first World Economic Forum meeting, having been invited to join its global chemicals council. My first impression was astonishment – at the complete disconnect between the real knowledge of the experts at the Forum and today’s “consensus wisdom” . China is a great example. The external consensus still thinks the new leadership is focused […]
Oil prices under pressure as US oil and gas output rises
Just 10 years ago, then BP CEO John Browne shocked the oil industry by suggesting that oil prices might “temporarily” rise to $40/bbl due to an imbalance of supply and demand, before falling back below $35/bbl again. Of course, prices in fact moved much higher, as policymaker stimulus in first the US and then the […]
US heads for record oil and gas output
Sometime over the next year, the US is likely to set a new all-time record for oil production, reversing the pre-2008 trend. Natural gas production has already reached new all-time peaks. As the chart shows: US natural gas production peaked in 1973 at 62 Bcf/day, and then fell by a quarter to 46 Bcf/day in 1986 (blue) […]
World Aromatics and Derivatives Conference next week
Our 13th annual World Aromatics & Derivatives Conference takes place in Berlin next week. Jointly organised as always by International eChem and ICIS, it features a must-hear list of speakers: ExxonMobil: Europe Business Director Tim Stedman will give a global market overview Dow Chemical: Global Business Director Pieter Platteeuw will discuss the future for benzene […]
Great Unwinding leads to major chemical market downturn
It is now almost 3 months since I suggested the Great Unwinding was about to hit oil and chemical markets. As the chart above shows, there has since been a major collapse in most of the markets in our benchmark portfolio. Given their role as leading indicators for the global economy, this major downturn is extremely worrying: […]
Boom/Gloom Index suggests S&P 500 close to its peak
How long can the juggler keep all the balls in the air? That is the question that compels us to stand in the square and watch her skill at work. We have the same fascination watching central bankers at work – they similarly aim to keep financial markets aloft, to create their desired ‘wealth effect’. But we know that […]
US jobs data confirms long-term decline in participation rate
Many people, including former US Federal Reserve Chairman Paul Volcker, have questioned whether it is really possible for the US Federal Reserve to use monetary policy to boost employment. What can the Fed do to ensure people get the high school diplomas they need for employment today? What can it do to provide more jobs for Blacks […]
China’s smartphones outsell Samsung & Apple combined in Q3
The picture on the right is the Xiaomi Mi4 smartphone. The 16GB version sells in China at Rmb 1999 ($326), and the 64GB version at Rmb 2499. By comparison, Apple’s iPhone 6 sells for Rmb 5288. Unsurprisingly, Xiaomi is moving up the world sales league very fast. In Q2, it jumped to 5.1% market share, from just 1.8% in Q2 […]
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