We help companies and investors to manage today’s crisis, and to begin building a robust and sustainable future for their business in tomorrow’s Net Zero world.

Outlook

“Prepare for possibilities and probabilities, not calling one course of action, since I’ve never seen anyone call it. I would be quite cautious about what might happen next year”. Jamie Dimon, JP Morgan CEO, 25 October 2023

“Basic industries in Europe are grappling with historical challenges: demand is declining, investments in the continent are stalling, production has dropped significantly, and sites are threatened. We want to drive the transformation of our companies.”

The Antwerp Declaration, 20 February 2024

“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

“You can’t run the most reckless monetary and fiscal experiment in history without the bill eventually coming due. The first invoice arrived as inflation. The second has come as a financial panic, with economic damage that may not end with Silicon Valley Bank.”

Wall Street Journal editorial, 12 March 2023

The chemical industry is the best leading indicator for the global economy, due to its size, geographic reach and early position in the value chain

The industry is now warning of recession and massive over-capacity as central banks’ stimulus programme finally unwind.

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.

The end of the two great “dividends” that have powered global growth since the 1980s. The “demographic dividend” created by the BabyBoomer generation has now become a “demographic deficit”, as the Boomers join the lower-spending, lower-earning Perennials 55+ cohort. And we have lost the “peace dividend” created by the fall of the Berlin Wall in 1989, that allowed $tns to be diverted from armaments to health and social spending

China’s economy has been “subprime on steroids” since 2009. It led the global economy out of recession after 2008, but its $43tn of stimulus meant that real estate became 29% of GDP. This “bubble” is now inevitably bursting. Beijing plans to replace the lost jobs by boosting manufacturing exports, which risks creating major trade frictions in global markets.

Geopolitics are rising up the agenda again. This means that economics are no longer the main factor in decision-making. Major wars are now underway in Ukraine and the Middle East, whilst OPEC+ continues to target higher oil prices in support of its political objectives.

Sustainability is also rising up the agenda – and creating major changes/ tensions in global markets. Auto markets highlight the exponential nature of the developments underway, with Electric Vehicles taking 18% of the global market in 2023 versus just 4% in 2020, as an increasing number of governments mandate the end of gasoline/diesel cars by 2030/35.

Research: How the Pros Do It — Geo Chen and Paul Hodges
RealVision | 28 Feb 2024
Global Industrial Slowdown Could Drag Down U.S. Economy In 2024, Argues Paul Hodges
Blockworks Macro | 13 Jan 2024
RV Real Vision Daily Briefing 5 December 2023 with Paul Hodges
Daily Briefing
Paul Hodges | Real Vision (5 Dec 2023)
Is the Fed back in play?
Paul Hodges | Real Vision Finance (6 Sep 2023)

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Paradigm Shifts

These paradigm shifts are also reinforcing each other. The Ukraine war, for example, means Western governments are accelerating the move to renewables so as to reduce Russian influence on energy markets. This development adds to the value of timely analysis and good judgement. 

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.

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New Normal in the News 

2024

May
April
March

PODCAST: Think Tank: Why stock markets soar while chemicals slump

PODCAST: Think Tank: Indorama, BASF strategy shift could signal end of integrated sites

February

PODCAST: Think Tank: Antwerp Declaration shows chemicals CEOs mean business

PODCAST: Think Tank: More trade barriers, regional isolation could protect Europe, US chemicals

PODCAST: Think Tank: Saudi chemical producers under pressure as ethane price soars

Energy, petrochemical, fertilizer sectors face 5 key risks in 2024

January

PODCAST: Think Tank: Distributors face higher costs, margin pressure from Red Sea disruption

Continuous progress

PODCAST: What dangers lurk in the year of the dragon?  

PODCAST: Think Tank: How AI can help navigate Suez, Panama crises

Time for a new business approach

PODCAST: Think Tank: Expect no end to downturn in 2024 as poor demand, overcapacity become entrenched  

2023

December

PODCAST: Think Tank: Catalysts will enable decarbonized chemical supply chains  
COMMENT: Where is chemical recycling on its path to circularity? Plastics Europe
PODCAST: Think Tank: Capacity equal to Europe’s entire 2023 ethylene demand could close by 2028  

RV Real Vision Daily Briefing 5 December 2023 with Paul Hodges
Daily Briefing: A New Digital Gold Rush?
Paul Hodges | Real Vision (5 Dec 2023)
November

BASF Set to Operate Europe’s First Electric Chemicals Furnace Bloomberg 

PODCAST: Think Tank: AI can help companies tackle biggest pain points 

November

PODCAST: Think Tank: New ‘supermajors’ will dominate chemical industry 
PODCAST: Think Tank: China exports price deflation 
PODCAST: Think Tank: Huge pressure to close petrochemical plants as global overcapacity grows 
PODCAST: Think Tank: Era of rapid change heralds winners and losers; trough conditions to persist 

October

PODCAST: Think Tank: Europe faces tough 2023/4, must think long-term 
PODCAST: Think Tank: Chemicals needs leaders like Steve Jobs to reinvent industry 

September

Companies must be bold and transform, as paradigm shifts reshape the business world 
PODCAST: Think Tank: Industry contends with fundamental shift to global economy 


Is the Fed back in play?
Paul Hodges | Real Vision Finance (6 Sep 2023)

August

Investors should pack a copy of the Old Testament for the beach Financial Times letter 
PODCAST: Think Tank: What China’s economic malaise means for chemicals 

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