A funny thing is happening in Europe. Coal power, thought to have been rendered moribund by the push for “greener” energy, is enjoying a resurgence, and a most profitable one at that. All actions have consequences, and Europe’s shift from coal to natural gas for power-generating and heating has made it vulnerable to shortfalls in...
Category: TRENDS ON THE GLOBAL ECONOMIC FRONT
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SIX COUNTRIES AGREE TO COORDINATED RELEASE OF OIL FROM STRATEGIC PETROLEUM RESERVES
The U.S. will release 50 million barrels of crude oil from its strategic petroleum reserve as part of a joint six-country agreement to bring more oil to market to reduce prices of gasoline and other petroleum products. The nations involved are China, India, Japan, South Korea, the UK, and the U.S. U.S. gas prices at...
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WALL ST. CRIME GANG
Insider trading, even by those who are supposed to be regulating the financial industry, has been the topic of a number of Trends Journal articles; see, for example, “FED TIGHTENS TRADING RULES AFTER SCANDAL FORCES RESIGNATIONS” (26 Oct 2021), “BANKSTER BANDITS: CRIME SYNDICATE COVER UP” (16 Nov 2021) and “FED ETHICS? FU!” (21 Sep 2021)....
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“EXUBERANCE” LEAVES ASSETS VULNERABLE TO RATE HIKES
“Exuberance,” often a polite term for reckless speculation, in cryptocurrency, housing, and junk bonds has left those markets vulnerable to dramatic reversals if interest rates rise sharply, the European Central Bank (ECB) warned in its twice-yearly financial stability report. The Eurozone’s economy is well along in its recovery, which reduces short-term financial risks, the bank...
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SPOTLIGHT: BIGS KEEP GETTING BIGGER
PRIVATE EQUITY GROUP BUYS McAFEE Cybersecurity company McAfee Corp. is being taken over by a consortium of investors led by private equity firms Advent International and Permira Advisors for $14 billion in one of this year’s largest leveraged buyouts. Other partners include the Abu Dhabi Investment Authority, the Canada Pension Plan Investment Board, Crosspoint Capital...
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ETHANOL PRICE UP 50 PERCENT THIS YEAR
The price of ethanol, the common corn-derived gasoline additive, has soared about 50 percent so far this year, The Wall Street Journal reported, as people return to the roads after bunkering at home for most of 2020. U.S. road traffic was 8 percent heavier in August than a year previous, according to the Federal Highway...
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RISING OIL PRICES WILL SHRINK DEMAND, OPEC SAYS
Fast-rising prices for oil likely will slow demand in some of the world’s largest economies in the next few months, the Organization of Petroleum Exporting Countries said in its 10 November monthly market report. World oil use will expand by 5.7 million barrels per day this year overall, 160,000 barrels less than OPEC predicted in...
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COST OF CAPITAL SOARS FOR OIL AND GAS PRODUCERS
A decade ago, the cost of capital—the interest paid to borrow the money to fund a capital project—for developing long-term oil and gas deposits and for launching a renewable energy project was about 8 percent to 10 percent for both, according to a Bloomberg analysis. Not now. The minimum return needed to financially justify a...
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FOREIGN INVESTORS POUR ANOTHER $120 BILLION INTO CHINESE MARKETS
Global investors have bought $120 billion in Chinese stocks and bonds so far in 2021, according to the Financial Times, as investors bet on higher returns than those available elsewhere, despite the quirky and unpredictable hand of China’s regulators and government policy. Foreign investment in China’s equity and fixed-income markets totaled about $1.1 trillion as...
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FOOD PRICES HIT DECADE HIGH
Droughts in the U.S. and South America have ruined coffee, corn, sugar, wheat, and other crops. China’s record purchases of grains have tightened global supplies and pushed up prices for livestock farmers and food processors. The cost of cooking oils has surged as the biofuel industry has claimed a larger share of world production. Globally,...