It’s 10 years since my forecast of a global financial crisis came true, as Lehman Brothers collapsed. I had warned of this consistently here in the blog, and in the Letters column of the Financial Times. But, of course, nobody wanted to listen whilst the party was going strong. As the FT’s world trade editor wrote […]
Chemicals and the Economy
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 […]
London house prices slip as supply/demand balances change
London house prices are “falling at the fastest rate in almost a decade” according to major property lender, Nationwide. And almost 40% of new-build sales were to bulk buyers at discounts of up to 30%, according of researchers, Molior. As the CEO of builders Crest Nicholson told the Financial Times: “We did this sale because we […]
Financial markets party as global trade wars begin
More people left poverty in the past 70 years than in the whole of history, thanks to the BabyBoomer-led economic SuperCycle. World Bank and OECD data show that less than 10% of the world’s population now live below the extreme poverty line of $1.90/day, compared to 55% in 1950. Globalisation has been a key element in […]
China’s lending bubble is history
As China’s shadow banking is reined in, the impact on the global economy is already clear, as I describe in my latest post for the Financial Times, published on the BeyondBrics blog China’s shadow banking sector has been a major source of speculative lending to the global economy. But 2018 has seen it entering its […]
US Treasury benchmark yield heads to 4% as 30-year downtrend ends
The US 10-year Treasury bond is the benchmark for global interest rates and stock markets. And for the past 30 years it has been heading steadily downwards as the chart shows: US inflation rates finally peaked at 13.6% in 1980 (having been just 1.3% in 1960) as the BabyBoomers began to move en masse into the […]
Chart of the Year: Bitcoin, the logical end for stimulus policies
Last year it was the near-doubling in US 10-year interest rates. In 2015, it was the oil price fall. This year, there is really only one candidate for ‘Chart of the Year’ – it has to be Bitcoin: It was trading at around $1000 at the start of 2017 and had reached $5000 by August […]
China’s central bank governor warns of ‘Minsky Moment’ risk
The world is coming to the end of probably the greatest financial bubble ever seen. Since the financial crisis began in 2008, central banks in China, the USA, Europe, the UK and Japan have created over $30tn of debt. China has created more than half of this debt as the chart shows, and its total debt […]
US tax cuts will fail as Trump’s demographic deficit replaces Reagan’s demographic dividend
No country in the world now has a top quality pension system. That’s the conclusion from the latest Report by pensions consultants Melbourne Mercer. As the chart above shows: Denmark and The Netherlands have fallen out of the top category In the G7 wealthy nations: Canada is in category B; Germany and UK in C+; […]
Interest rates and London house prices begin return to reality
Global interest rates have fallen dramatically over the past 25 years, as the chart shows for government 10-year bonds: UK rates peaked at 9% in 1995 and are now down at 1%: US rates peaked at 8% and are now at 2% German rates peaked at 8% and are now down to 0%: […]