We support companies and investors in the wider chemicals industry community to manage today’s crisis and build a robust and sustainable future for their business in tomorrow’s Net Zero world.

Outlook

First there was the pandemic and associated supply chain chaos. Then there was the rise of ‘Putinflation’ as Russia’s invasion of Ukraine creates a growing risk of energy, food and financial crises.

“We are facing the biggest crisis the post-war Federal Republic has ever had. We have to be honest and say: First of all, we will lose the prosperity that we have had for years.”

German Employers Association President, Rainer Dulger, 13 July 2022

“We can no longer rely exclusively on the (inflation) projections provided by our models – they have repeatedly had to be revised upwards over these past two years. There are things that the models don’t capture. Sometimes the unexpected happens. So we have to pay attention to traditional indicators while also monitoring empirical data and what we expect to happen in terms of geopolitics, energy price developments and demographics.”

European Central Bank President, Christine Lagarde, 25 August 2022

Risk management is key to survival, and future success

Scenario planning, based on a wide range of potential outcomes, will be key to success given today’s levels of volatility. We can no longer simply tweak a base case to reflect whether we are feeling marginally more optimistic or pessimistic.

Recession till 2025.  We need to be realistic about the outlook and not assume the current recession will be over by Christmas. The issues we face are more likely to take years to resolve as they involve deep-seated problems

China is changing. It has bankrolled global growth since 2009, but now its model is shifting to self-sufficiency, alongside a major move into recycling to meet Net Zero targets. Its real estate market has been ‘subprime on steroids’ and its bursting will have far-reaching consequences for the global economy

Food shortages. As Sri Lanka’s suffering has shown, social unrest is rising around the world as food shortages increase along with prices for other essential goods. In turn, this will inevitably destroy the myth that demand growth in developing countries can somehow balance the downturn in developed markets

Invest for the future.  Recession will accelerate the transition to a Net Zero economy. The invasion is already reducing fossil fuel demand. And demand patterns are changing very quickly as people refocus on ‘needs’ rather than ‘wants’.

Paradigm Shifts

Some of these changes are already becoming obvious, such as rising levels of debt and the threat of inflation. Others are still to appear. These relate to the way behaviour is changing in response to the Covid pandemic and the Ukraine war in 5 key areas where major paradigm shifts are underway:

DEMAND PATTERNS

Demand patterns paradigm shift in global business

The lockdowns have broken down the inertia surrounding work and home-based routines…

RESHORING SUPPLY CHAINS

Reshoring supply chains paradigm shift in global business

Global supply chains have proved very fragile during the pandemic. They have collapsed…

RENEWABLE ENERGY

Renewable energy – Paradigm shifts in the global economy

Energy markets are seeing a major paradigm shift, with the pandemic and the Ukraine war accelerating the shift to renewables…

CIRCULAR ECONOMY

Circular economy – Paradigm shifts in the global economy

The need to reshore supply chains in a world of potential energy abundance suggests that moves towards a circular economy will accelerate…

ADVANCED MANUFACTURING

Advanced manufacturing paradigm shift in global business

Many manufacturing operations still operate as they would have done 500 years ago, or even 50 years ago…

FINANCIAL MARKETS

Financial markets fiscal policy – Paradigm shifts in the global economy

Governments are refocusing on fiscal policy instead of monetary policy as the debt bubbles created by central bank stimulus begin to burst.

The Car Market Is Crashing
Paul Hodges | Blockworks (1 Dec 2022)
The Chemicals Market Is Bearish – Stupendously Bearish
Paul Hodges | Blockworks (4 Nov 2022)
RealVision My Life in 4 Trades: Paul Hodges Believes Markets Will Refocus on Price Discovery
Paul Hodges believes markets will refocus on price discovery
RealVision (3 Aug 2022)
RealVision interview: Paul Hodges Says Investors Should Stop Fed Watching
Paul Hodges Says Investors Should Stop Fed-Watching
RealVision (7 Jun 2022)

What our subscribers say:

New Normal testimonials 2022 12

Consulting

new normal consulting – we support you on the 'new normal' learning curve and implement new strategies

The support you need to move quickly up the ‘new normal’ learning curve and implement new strategies.

Reports

The pH Report - The litmus test for the global economy - since 2014 - by New Normal

$10,995 per year
The litmus test for the global economy

  • Monthly report
  • In depth analysis of macro economic issues
  • Telephone access to experts

The pH Report - subscribe

new normal newsletter

FREE
No sign up required

New Normal eBook – Boom, Gloom and the New Normal

FREE
Boom, Gloom and the New Normal

New Normal in the news

2023
 
Jan PODCAST: Think Tank: EU chemicals may lose free carbon credits, double costs, under CBAM legislation
  PODCAST: The economic importance of chemicals BLK Capital Management interview
  Economy drives need for change
 
2022
 
Dec Onde ficarão as próximas plantas de PE e PP? Plásticos em Revista
  PODCAST: Think Tank: Europe chemicals suffer lowest operating rate since 2008, global industry in doldrums
  PODCAST: Think Tank: Ban on Russian refined products will hurt Europe more than oil restrictions