February 18, 2012

ONE ECONOMY TO RULE THEM ALL:

US economy is stepping on the gas: Employment, profit and car sales figures are looking much brighter across the Atlantic than in Britain. (Jeremy Warner,  18 Feb 2012, The Telegraph)

[A] new industry has come to town, bringing investment, thousands of jobs and growing prosperity. Steubenville is one of scores of new boom towns springing up along the American Appalachians, from Ohio and Maryland, to West Virginia, Pennsylvania and New York, all of them beneficiaries of the shale gas revolution, a new technology that allows access to abundant reserves of natural gas trapped within the rock.

The results are startling. It's not just the mini-boom in business investment. It's also meant that for the first time in more than 40 years, the US is close to achieving its goal of energy self-sufficiency. Energy costs have fallen so sharply that Methanex Corporation, the world's biggest methanol maker, recently announced it was dismantling its factory in Chile and reassembling it in Louisiana, perhaps the biggest example yet of the new found fashion for "onshoring".

This is just one of any number of similar decisions that stem from the shale gas revolution. Dow Chemical plans a new propylene unit in Texas by 2015. Formosa Plastics similarly proposes a $1.5 billion investment in ethylene-related plants in the same state, while both US Steel and Vallourec are planning multi-million dollar investments in new steel capacity to meet demand for shale gas extraction.

Nor is shale the only part of America's economic renaissance. All over the shop, the American economy is spluttering back into life. Just this week, General Motors, bankrupted almost beyond redemption three years ago, reported its best bottom line profit.

Automobile sales are at their highest level since the start of the financial crisis, and there are even signs that the delinquent housing market is finally beginning to turn. Sales to listings, a key measure of the health of the US housing market, are at last moving in the right direction, while in some states, prices have actually started to rise.

Just wait until the borders reopen.

Posted by at February 18, 2012 10:41 AM
  

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