OPEC+ oil producers saw prices tumble $10/bbl (13%) on Friday as the world woke up to the fact that the next phase of the pandemic may be underway. And this is not the only challenge that they face. OIL PRICES HAVE ONLY BEEN HELD UP BY MAJOR SUPPLY CUTBACKS The first is the challenge from […]
Chemicals and the Economy
Industry now needs to step up, if Net Zero is to be achieved
Net Zero is clearly the key issue of our time. With COP26 about to start, 3 key elements need to come together to ensure success. Political leaders have to agree to meet the Net Zero targets, and to provide $100bn/year to help poorer nations fund the changes needed. But nothing will happen on the ground […]
The Fed’s stock market bubble is at risk as China bursts its real estate bubble
The US stock market bubble just keeps rising. And every investor “knows” that the US Federal Reserve will never let it burst. But the Fed can’t control the fallout from the bursting of China’s ‘subprime on steroids’ real estate bubble. Could this also mean the end of the Fed’s bubble? There is no doubt that […]
“When all the experts and forecasts agree — something else is going to happen”, Bob Farrell
In January, “everyone knew” that inflation was about to take off, and that the US$ was going to collapse. Last week, the great Bob Farrell’s Rule No 9 proved its worth, yet again. US interest rates fell sharply and the US$ bottomed for this cycle. The two charts above tell the story – because they […]
Rising US interest rates, US$ and oil prices set to pressure financial markets
Everyone who has ever played the Beer Distribution Game on a training course knows what is happening in supply chains today. A small increase in underlying demand is rapidly leading to a massive increase in ‘apparent demand’. As the New York Times reports, “the pandemic has disrupted every stage of the (supply chain) journey.” And […]
Chart of the Year – CAPE Index signals negative S&P 500 returns to 2030
Each year, it seems there is only one candidate for Chart of the Year. And 2020 is no exception. It has to be the CAPE Index developed by Nobel Prize winner, Prof Robert Shiller. As the chart shows, it is nearly at an all-time high with Tesla’s addition to the S&P 500. Only the peak […]
Trump policies to impact global supply chains, US stock markets
Wall Street’s post-election rally suggests that many investors currently have the wrong idea about Donald Trump. They have decided he is a new Ronald Reagan, with policies that will deliver a major bull market. But those promoting this narrative have forgotten their history. Both men certainly share a link with the entertainment industry. But Reagan […]
S&P 500 volatility close to 43-year lows as uncertainty rises
Something very strange is happening in US stock markets, as the above chart highlights: It shows weekly (blue line) and average quarterly (red line) volatility in the US S&P 500 Index since 1928 Both are very close to 43-year lows, going back to September 1973, at 1.7% and 1.6% respectively This seems quite […]
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 […]
Boom/Gloom Index suggests volatile August may lie ahead
It may be an idea to keep your smartphone charged and within reach, if you are planning a trip to the beach this month. Certainly market behaviour since June has been more and more skittish. The experts, after all, were telling us that central banks were certain to do more major stimulus efforts to boost […]
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