China’s housing inventory is now at a record 25 months. Prices/demand continue to fall. And local government land sale income has already fallen 1/3rd since 2021 to $800 billion, with a further 10% fall to expected this year. And so now services are having to be cut.
Chemicals and the Economy
Smartphone sales continue to slow as consumer demand patterns change
Q1 data showed that many consumers are tightening their belts and focusing on value for money. But investors don’t yet seem to have noticed, and are bidding up Apple’s share price to euphoric levels.
Currency wars kick off as Japanese yen tumbles close to 38-year low
This is the 3rd time we have forewarned of an approaching crisis. Both previous times, ahead of the Great Financial Crisis and the Covid pandemic, we were told we “didn’t know what we were talking about”. Let’s hope its “3rd time lucky” and that “this time is different”.
“Gradually, then Suddenly” – Hemingway’s insight starts to apply to the New Normal’s arrival
As Hemingway noted, everyone is your friend when things are going well. But as countries and individuals are now starting to discover, the hangover when the party ends can be a painful experience.
US and EU prepare for trade war with China on Electric Vehicles as auto demand patterns change
The world is now moving from today’s “Continuous Instability” into “Growing Disruption”. Real wars are already escalating in Europe and the Middle East. Trade wars are beginning. And Demand Patterns in key industries such as autos are starting to change very rapidly.
US Treasury Secretaries change their minds on trade and inflation policies
Policymakers in the West and the East now find themselves adrift in increasingly stormy seas, without a compass. Their 2 key policy tools on trade and inflation have proved to be wrong. New thinking on the role of central banks is urgently required.
Oil and financial markets start to wake up to geopolitical reality
The oil price has rallied 22% over the past 4 months, since it bottomed at $74/bbl. And slowly but surely, traders are being forced to realise that geopolitics are replacing economics as the key driver for world markets.
Risks mount for US ethylene exports
Future Winners in today’s New Normal world will be those companies that realise that the key question is no longer, “Do we have low-cost supply?” It is instead “Do we have a customer who is willing and able to buy from us”.
All happy property owners are alike, each unhappy owner is unhappy in their own way
“The entire commercial real estate space has to reset. No one really knows where the values are…You can’t raise rates this quickly and not expect a financial shock. We’re already working on transactions at 50% on the dollar: the equity is wiped out and half of the loan is wiped out.”
Western automakers face a race to catch up as Chinese EVs arrive
Automakers have very little time – maybe as little as 5 years – to reposition themselves to meet today’s market needs. They need to develop an integrated EV supply chain. And they also need to follow Stellantis’ lead and go back to selling affordable cars costing €25k.