liquidity

China’s lockdown makes global debt crisis now almost certain

Beijing has a population of 21.5 million, but you wouldn’t know it from this BBC video from last Thursday.  Normally busy streets and transport systems are eerily empty, with food deliveries often the main traffic on the roads. It’s the same picture in industry, with the Baidu Migration Index reporting only 26% of migrant workers

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High-flying “story stocks” hit air pockets as credit finally tightens

“Nobody could ever have seen this coming” is the normal comment after sudden share price falls.  And its been earning its money over the past week as “suddenly” share prices of some of the major “story stocks” on the US market have hit air pockets, as the chart shows: Facebook was the biggest “surprise”, falling […]

The post High-flying “story stocks” hit air pockets as credit finally tightens appeared first on Chemicals & The Economy.

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Chemical industry warns of likely global recession in 2017

The chemical industry is the best leading indicator for the global economy, and it is flagging major warning signs about the outlook for 2017.  As the chart above shows, based on American Chemistry Council (ACC) data:   Since 2009, Capacity Utilisation (CU%) has never returned to the 91.3% averaged between 1987 – 2008   It […]

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Oil market speculators profit as central banks hand out free cash

Oil markets are entering a very dangerous phase.  Already, many US energy companies have gone bankrupt, having believed that $100/bbl prices would justify their drilling costs.  Now the pain is moving downstream. The problem is the central banks.  Hedge funds have piled into the oil futures markets since January, betting that there would be lots […]

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New oil price fall is matter of “when”, not “if”, as inventory builds

Financial players have become convinced in recent months that the oil price will rise.  And so far, this has been a self-fulfilling prophecy.  Their buying has led to oil being stored all over the world – in tankers floating at sea and in shale oil wells, as well as in storage tanks. Unsurprisingly, prices have […]

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Oil price collapse, US$ rise confirm Great Unwinding underway

Stock markets are floating ever higher on an ocean of central bank money printing.  But something else is happening in the real world where we all live and work.  Since August, I have been warning that the Great Unwinding of this policymaker stimulus is now underway.  The chart above highlights how my 2 core forecasts have now been confirmed: Brent Oil […]

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Seven global implications of China’s new policies

Everyone remembers the old joke, “Why did the elephant wear dark glasses?”, and the answer, “So that she wouldn’t be recognised”.  A new version popped into the blog’s mind this week, when finishing its new Research Note on the impact of China’s new policies on the global economy: “Why did nobody notice that China was the ‘elephant […]

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Global economy approaches a T-junction

Intuition’s great benefit is that it provides a different perspective.  Thus the intuitive concept behind the launch of the IeC Downturn Monitor was that April 2011 would prove a watershed moment for policymakers’ Recovery Scenario after 2008′s financial crisis.  Their Scenario essentially had two elements: Acting as a ‘lender of last resort’ when the major banks stopped lending to each other and the […]

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Growth remains below SuperCycle trend, whilst debt is building

Whisper it quietly, so as not to disturb policymakers’ dreams.  But the charts above from the Financial Times confirm, as if proof were needed, that their policies of the past 5 years haven’t worked. The charts compare trends in economic growth in the world’s two largest economies, the Eurozone and the USA.   As the arrows indicate, both are […]

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Financial markets worry as Fed talks of ending stimulus

After 5 years of government stimulus, policymakers are having to think about their exit plans.  US Federal Reserve chairman Ben Bernanke retires in January, and most of the blog’s clients in the financial community believe that he intends to start the process before he leaves, perhaps as early as next month. This is likely to prove very scary […]

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