“Will economists start to consider demographics when making their forecasts and developing government policies?” This was the question on my mind at a recent discussion on the topic of “An economy that works for everyone” at the UK’s Institute for Government. The speaker was the Chief Economist of the Bank of England, Andy Haldane, and the Institute’s […]
Chemicals and the Economy
Interest rate and US$ surge mark start of the Great Reckoning
The bond market vigilantes are back. And they clearly don’t like what they are seeing. That is the clear message from the charts above, showing movements in 10 year government bond interest rates for the major economies, plus their exchange rate against the US$ and the value of the US$ Index: As I warned […]
US 10-Year interest rates suggest Great Reckoning may be near
“History doesn’t repeat itself, but it often rhymes“, Mark Twain Bob Farrell of Merrill Lynch was rightly considered one of the leading Wall Street analysts in his day. His 10 Rules are still an excellent guide for any investor. Equally helpful is the simple checklist he developed, echoing Mark Twain’s insight, to help investors avoid […]
You’ve seen the Great Unwinding; get ready for the Great Reckoning
Companies and investors now need to prepare for the Great Reckoning, as I describe in my latest post for the Financial Times, published on the BeyondBrics blog We have reached the second anniversary of the Great Unwinding of policymaker stimulus. Almost inevitably, this now seems likely to be followed by a Great Reckoning, a consequence […]
US pensioners pay the price for Fed’s monetary policy failure
There was one bit of good news this week. For the first time since the financial crisis began, a Governor of the US Federal Reserve acknowledged that today’s demographic changes are having a major impact on the US economy. John Williams, of the San Francisco Fed, argued that: “Shifting demographics….(mean that) interest rates are going […]
The end of the Economic SuperCycle
A paradigm shift is underway in global petrochemical and polymer markets, as I discuss in a new article for ICIS Chemical Business. Previously successful business models, based on the supply-driven principle, no longer work. As our new study, “Demand – the New Direction for Profit”, explains, companies now need to adopt demand-led strategies if they […]
Japan goes back into recession as stimulus policies fail, again
This week’s economic data from Japan confirmed, once again, that demographic changes are far more important for the economy than monetary stimulus. Japan’s premier Abe took power in 2012, promising to end the decline in Japan’s economic growth. He appointed a new Governor for the Bank of Japan, and claimed that his “3 arrows policy” […]
Deflation returns to the major economies as stimulus fails, again
Next week, I will publish my annual Budget Outlook, covering the 2016-2018 period. The aim, as always, is to challenge conventional wisdom when this seems to be heading in the wrong direction: The 2007 Outlook ‘Budgeting for a Downturn‘, and 2008’s ‘Budgeting for Survival’ meant I was one of the few to forecast the 2008 Crisis 2009′s ‘Budgeting […]
1 in 5 of world population will be in New Old 55+ generation
An amazing development is taking place in the world today. For the first time in human history, more people are joining the 55+ age group than the 25 – 54 age group: 600m people will be joining the New Old 55+ cohort between now and 2030, taking their numbers to 1.8bn This is twice the […]
US incomes have plateaued since 2001 as Boomers turn 55+
More and more people are lining up to support our argument that central bank stimulus programmes are damaging the economy, not helping it. The latest is bond guru Bill Gross, who wrote yesterday: “Zero bound interest rates destroy the savings function of capitalism….(whilst companies) have plowed trillions into the financial economy as they buy back […]
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