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 impact of aging populations on demand
Rising life expectancy means that an entirely new generation, the Perennials 55+, are now the main source of population growth in the world, and 9 of the Top 10 economies. This creates a major headwind for growth, as they already own most of what they need and their incomes decline as they move into retirement.

China is changing
Its economy has been ‘subprime on steroids’ since 2009. It led the global economy out of recession, but its $43tn of stimulus means real estate now accounts for 29% of GDP – and the bubble is now clearly starting to burst with sales and prices already in a downturn.

Geopolitics
Russia’s invasion, and OPEC+’s decision to target higher oil prices by reducing output, highlights the paradigm shift underway. This creates major risks for companies and investors, as we can no longer automatically assume that economics will drive rational decisions.

Invest for the future
Auto markets highlight the exponential nature of the changes underway. Electric Vehicles accounted for 18% of the global market in 2022 versus just 4% in 2020. And an increasing number of major states nave mandated the end of new gasoline/diesel car sales by 2030/35.

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

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.

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New Normal in the News 

2024

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  

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 

July

PODCAST: Think Tank: Chemical industry must wake up to climate emergency 
PODCAST: Think Tank: Companies need to take bold steps to thrive in Europe 
PODCAST: Think Tank: Falling chemical prices signal switch from inflation to deflation 

June

It Feels Like ‘Lehman II’ in This Crucial Industry Bloomberg 
It Feels Like ‘Lehman II’ in This Crucial Industry Washington Post 
PODCAST: Think Tank: Europe PE, PP panic confirms persistent demand collapse  
Richard Carter joins Itero Advisory Panel 
PODCAST: Think Tank: China, energy transition spur volatility in oil, chemical markets
 
We Need to Talk About China, Again
 
PODCAST: Think Tank: PFA conflict flags existential questions for chemical industry
 

MEDIA CENTRE