Normally a 275 point fall on Wall Street, and a 600 point fall in Hong Kong, would make for some headlines. But this time, the media coverage has been very muted. Presumably everybody thinks it will be another ‘9 day wonder’, and believes with Chuck Prince of Citigroup that one simply has to keep ‘dancing’. […]
Chemicals and the Economy
NINJA turtles ride again
The head of Germany’s financial regulator is warning that US subprime mortgage problems may be about to lead to the worst banking crisis since 1931. Yesterday, WTI crude broke through its 1980’s highs to hit a new all-time record price of $78.77/bbl, and looks poised to push on past $80/bbl. And adding to the sense […]
Turning base quality loans into gold
Alchemists once claimed the ability to turn base metal into gold. More recently, some bankers seem to have been claiming a similar genius, via the magic catalyst of securitisation. These bankers no longer perform their traditional role of lending on a prudent basis to good quality borrowers in the personal or corporate sector. Instead, they […]
Greed and Fear
Bill Gross runs PIMCO, the world’s largest government bond managers with assets of nearly $700bn. In a new commentary, he pulls no punches about what he sees as the ‘gluttony’ of the super-rich amongst the private equity and hedge fund elite. He also takes aim at the lenders who, in his view, have been ‘too […]
A tale of two outlooks
If you read the financial pages of your newspaper, everything sounds rosy. But if you turn to the news section, its all gloom. Both views can’t continue to exist alongside each other for ever. Whichever scenario comes out on top, will have major implications for the chemical industry. My own view is that this week’s […]
Stress-testing the global financial system
Yesterday’s “swings in financial derivative prices were so extreme that they implied scenarios in which the core of the global liquidity system suffers a serious assault”, according to JP Morgan, the investment bank. Watch out, if current US sub-prime mortgage problems turn into a more general “flight from risk”.
Chemical company valuations
The prices paid for Petkim and for Lustran reflect two very different perspectives on the current market:
ICI and Akzo
ICI has experience of fighting off unwelcome acquisitions. And Akzo may find itself in a difficult position if ICI wins again. Unless this bid, like Hanson’s in 1991, marks the ‘top’ in the currrent M&A cycle.
4 risks to the world economy
The latest report from the ‘central bankers’ bank’ provides an excellent analysis of what might go wrong in the world economy over the next 2 – 3 years. Anyone interested in scenario planning will find its conclusions valuable.
Hedge fund woes and the chemical industry
The US Senate thinks the Amaranth hedge fund increased the costs of natural gas futures contracts last year. Any pension funds invested in Bear Stearns’ hedge funds might want to check on the current value of their holdings.
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