This is one of the art supplies that I bought on a recent trip to Wellington (New Zealand). It is 'liquid pencil' by Derivan. It is like pencil in a paint form and it is yummy!
I say yummy because it is the consistency of a thick glossy cream. You can thin it with water or acrylic medium and you can paint it on like a watercolour. It comes in six different colours: red, sepia, yellow, blue and two shades of grey. These aren't bright colours, they all look like pencil, but the colours are the undertone.
Here are a couple of links for you to have a look at:
Matisse Derivan product information page (includes some videos)
So far I have only used it to stencil through punchinella. The effect was brilliant though. I was able to vary the thickness I put it on for a varying effect, and it had a wonderful chalky pencil finish which was brilliant for a different texture and feeling to ink or acrylic paint stencilling.
I will blog the page I used it on in the next week after I am sure that my journal partner has got my journal and sees it first.