China is no longer seeking ‘growth at any cost’, with global implications, as I describe in my latest post for the Financial Times, published on the BeyondBrics blog A pedestrian covers up against pollution in Beijing © Bloomberg China’s President Xi Jinping faced two existential threats to Communist party rule when he took office 5 […]
Chemicals and the Economy
President Xi focuses on pollution, not growth, as key Party Congress nears
Imagine living in the capital city of a major country, and suffering the level of pollution shown in the above photo on a regular basis. We used the photo in chapter 6 of Boom, Gloom and the New Normal when we highlighted how pollution was inevitably going to move up the political agenda in China. Controversial at the […]
Chemical industry data shows reflation remains hope, not reality
Western central bankers are convinced reflation and economic growth are finally underway as a result of their $14tn stimulus programmes. But the best leading indicator for the global economy – capacity utilisation (CU%) in the global chemical industry – is saying they are wrong. The CU% has an 88% correlation with actual GDP growth, far […]
“Everyone wants to be rich”: Divorces soar with land prices as China’s housing bubble enters its final stages
One thing that “everyone knows” in China’s Tier 1 cities is that property prices can never go down. As one resident told the South China Morning Post: “The only thing I know is that buying property will not turn out to be a loss. From several thousand yuan a square metre to more than 100,000 […]
President Xi takes “core” leader role as China heads for political turbulence
Outside observers often imagine that China’s political structure is uniquely disciplined – unlike, say the US Republican Party, or the UK Labour Party, or indeed, political parties anywhere. But the fact that most arguments take place behind closed doors, and aren’t reported in the state-controlled media, doesn’t mean that the arguments don’t happen. Yesterday’s announcement […]
China’s slowdown continues as Xi “takes the pain” of reform
“What a difference a day makes“. Dinah Washington’s famous song could well be applied, with a longer timescale, to developments in China’s economy. The shape of the above chart has changed completely since it was last featured here in January 2015, as volatility has increased in China’s economy. It shows the relationship between bank lending and […]
China’s G20 Summit shutdown highlights risks to commodities buying “frenzy”
China’s polyester industry, like many others, is already preparing to shut down ahead of September’s G20 Summit in Hangzhou, to reduce pollution levels. The phenomenon even has its own Wikipedia page, APEC Blue, to describe the moment in November 2014 when Beijing suddenly saw blue sky for the whole of the Asia-Pacific Economic Co-operation (APEC) summit meeting. It […]
China Q1 electricity consumption up only 1% as economy slows
More and more evidence is emerging of the major slowdown now underway in China’s economy. China’s leadership have warned this would take place since they took office 2 years ago. And they have reinforced the message in recent months with their focus on explaining the move into the New Normal and its consequences. A major interview […]
How to survive the Great Unwinding of policymaker stimulus
I was privileged to be interviewed by Merryn Somerset Webb, editor-in-chief of MoneyWeek (the UK’s best-selling financial magazine) in this week’s edition. The interview covered a wide range of topics including the perilous state of UK house prices and some stock markets, and has prompted enormous interest amongst MoneyWeek readers. Merryn is one of the UK’s leading […]
China’s “wasted $6.8tn” highlights its new economic direction
Can you imagine your government publishing a report that showed $6.8tn has been wasted in “ineffective investment” in the past 4 years? That is $6.8tn, by the way, not a typo. And it is more than Japan’s total annual GDP, or the combined annual GDP of Germany and France. No, I thought not. I certainly cannot remember […]
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