Its now 4 years since the blog published its first New Year Outlook in ICB. Then it was in a small minority when advising CEOs “to prepare for a marathon not a sprint” in dealing with the financial crisis. And very few accepted its suggestion that it was “unlikely that governments will quickly find a […]
Chemicals and the Economy
Q3 results remain in downward trend
The blog’s quarterly survey of chemical industry results shows the downward trend continued in Q3. Some companies remain untouched by the mainstream problems, but they are now clearly in the minority: • Bayer remain optimistic, and DuPont hopeful that problems are merely temporary • But Dow now talk of a ‘new reality’ which sounds very […]
IMF warns on recession risk as Political, Social worries rise
When the economy is running well, most people tend to get on with their lives. That was the case during the 1982-2007 SuperCycle, when growth was almost constant. But today’s greater economic uncertainties translate into a growing role for Political and Social factors, as the triangle above describes: • In the West, politics is becoming […]
Buyers start selling benzene as demand disappears
What happens if prices stay unaffordable for so long, that the consumer eventually stops buying? Younger readers may not remember such a period, as it last happened in the early 1980s, before the SuperCycle began. But it looks as though they may be close to finding out. As ever, benzene is the key indicator for […]
‘Moving forward in volatile times’ the motto for H2
The chemical industry has a long track record as a leading indicator for the global economy. Its position in the value chain means that it sees what is happening upstream in energy markets, and downstream in consumer markets. Anyone studying Q2 results will therefore be concerned about the outlook. This is a major shift from […]
Oil markets break out of their ‘triangle’
There has never been any fundamental basis for the rise in oil prices over the past 3 years: • At no time has there been any actual shortage of product • In fact, inventories have always been at comfortable levels They rose only for two reasons: • The investment banks found they could make a […]
Europe’s banks turn to bullfight loans
The blog’s IeC Boom/Gloom sentiment indicator (blue column) continues to be neutral on the outlook. As the chart shows, this is quite unlike its performance in early 2009. Then it rose rapidly from February – accurately forecasting the major recovery that was about to start. The problem, of course, is that the austerity reading (red […]
The banana skin risk
This week’s news provided more evidence to support the blog’s fear that the global economy is close to recession: • The German economy, Europe’s motor, saw negative growth in Q4 • US retail sales grew just 0.1% in December, despite good auto sales • China’s auto sales fell in Q4, and house prices fell in […]
Oil prices hit record annual level in 2011
High oil prices are a bad thing for the global economy, and for the chemical industry, 2011 was therefore a very bad year indeed. Brent oil prices, the global benchmark, averaged $111/bbl in 2011. This is higher even than in 1979 and 1980, after adjusting for inflation. The chart shows the history since 1970, based […]
2012 Budgets
The blog will publish its fifth annual Budget Outlook next weekend. As usual, it is therefore time to review last year’s Outlook. Past performance may not be a perfect guide to future outcomes. But it is one of the best that we have. The blog’s 2008 Outlook ‘Budgeting for a Downturn’, and its 2009 ‘Budgeting […]
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