Saxo Bank's Outrageous Predictions for 2012

This is always fun…

***

Saxo Bank’s Outrageous Predictions for 2012:

1. The stock of Apple Inc plummets 50 per cent from 2011 high

Going into 2012 Apple will find itself faced with multiple competitors such as Google, Amazon, Microsoft/Nokia, and Samsung across its most innovative products, the iPhone and iPad. Apple will be unable to maintain its market share of 55 per cent (three times as much as Android) and 66 per cent on the iOS and iPad.

2. EU declares extended bank holiday during 2012

The December EU Treaty changes prove insufficient to solve EU funding needs, particularly those in Italy, and the EU debt crisis returns with a vengeance by mid-year. In response, the stock market finally caves in and drops 25 per cent in short order, prompting EU politicians to call an extended bank holiday, closing all European exchanges and banks for a week or more.

3. A yet unannounced candidate takes the White House

In 1992, Texas billionaire Ross Perot managed to take advantage of a recessionary economy and popular disgust with US politics and reap 18.9 per cent of the popular vote. Three years of Obama has brought too little change and only additional widespread disillusionment with the entire US political system, and conditions for a third party candidate have never been riper. Someone with a strong programme for real change throws his or her hat in the ring early in 2012 and snatches the presidency in November in one of the most pivotal elections in US history, taking 38 per cent of the popular vote.

4. Australia goes into recession

The effects of the slowing up-and-coming Asian giant ripple through Asia Pacific push other countries into recession. If there ever was a country dependent on the well-being of China it is Australia with its heavy dependence on mining and natural resources. And as China’s demand for these goods weakens, Australia is pushed into a recession, which is then exacerbated as the housing sector finally experiences its long overdue crash – a half decade after the rest of the developed world.

5. Basel III and regulation force 50 bank nationalisations in Europe

As 2012 begins, pressure will mount on the European banking system as new capital requirements and regulatory pressure force banks to deleverage in a great hurry. This creates a fire sale on financial assets as there are few takers in the market. A total freeze of the European interbank market forces nervous savers to make bank-runs, as depositors distrust deposit guarantees from insolvent sovereigns. More than 50 banks end up on government balance sheets and several known commercial bank brands cease to exist.

6. Sweden and Norway replace Switzerland as safe havens

As we saw with Switzerland, becoming a safe haven in a world of devaluing central banks presents a number of risks to a country’s economy. The capital markets of both countries are far smaller than Switzerland, but the Swiss are aggressively devaluing their currency and money managers are looking for new safe havens for capital. Flows into the two countries’ government bonds on safe haven appeal becomes popular enough to drive 10-year rates there to more than 100 basis points below the classic safe haven German Bunds.

7. Swiss National Bank wins and catapults EURCHF to 1.50

Switzerland’s persistency in fighting the appreciation of its currency will continue to pay off in 2012. With Swiss fundamentals – particularly export related – continuing to suffer mightily in 2012 from past CHF strength, the SNB and government bear down further to prevent more collateral damage and introduce extensions to existing programmes and even negative interest rates to trigger sufficient capital flight from the traditional safe haven of Switzerland to engineer a move in EURCHF as high as 1.50 during the year.

8. USDCNY rises 10 per cent to 7.00

As marginal returns from building million-inhabitant ghost towns diminish and exporters struggle with razor-thin margins due to the advancing CNY China gets to the brink of a “recession”, meaning 5-6 per cent GDP growth. Chinese policymakers come to the rescue of exporters by allowing the CNY to decline against a US Dollar – buoyed by its safe-haven status amid slowing global growth and an on-going Eurozone sovereign debt crisis – and send the pair up to 7.00 for a 10 per cent increase.

9. Baltic Dry Index rises 100 per cent

Lower oil prices in 2012 could lead to an increase in the Baltic Dry Index as operating expenses go down. Brazil and Australia are expected to expand iron ore supply, further leading to lower prices and therefore higher import demand from China to satisfy its insatiable industrial production. In combination with monetary easing this leads to a massive spike in iron ore demand.

10. Wheat prices to double in 2012

The price of CBOT wheat will double during 2012 after having been the worst performing crop in 2011. With 7 billion people on the earth and money printing machines at full throttle, bad weather across the world will unfortunately return and make it a tricky year for agricultural products. Wheat especially will rally strongly as speculative investors, who had built up one of the biggest short positions on record, will help drive the price back towards the record high last seen in 2008.

Steen Jakobsen, Chief Economist at Saxo Bank, commented: “Our Outrageous Predictions have been prepared in the spirit of encouraging investors to think outside the box and prepare for world-altering events. Thinking outside the box is rarely a comfortable exercise, but neither is dealing with an unpleasant surprise for which one has failed to prepare in any meaningful way.

“Should some of the predictions come to pass, it would make 2012 a year of tremendous change. We would like nothing more than to be proven wrong on negative views, but only if they are replaced with something better than the current central bank and government-manipulated paradigm.”

***

Source:

Saxo Bank

 

 

 

This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment.

The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Ritholtz Wealth Management employees providing such comments, and should not be regarded the views of Ritholtz Wealth Management LLC. or its respective affiliates or as a description of advisory services provided by Ritholtz Wealth Management or performance returns of any Ritholtz Wealth Management Investments client.

References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.

Wealthcast Media, an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. Investments in securities involve the risk of loss. For additional advertisement disclaimers see here: https://www.ritholtzwealth.com/advertising-disclaimers

Please see disclosures here.

What's been said:

Discussions found on the web
  1. Immediate Edge Review commented on Sep 22

    … [Trackback]

    […] Find More on to that Topic: thereformedbroker.com/2011/12/16/saxo-banks-outrageous-predictions-for-2012/ […]

  2. Immediate Edge Review commented on Sep 23

    … [Trackback]

    […] Info to that Topic: thereformedbroker.com/2011/12/16/saxo-banks-outrageous-predictions-for-2012/ […]

  3. immediate edge reviews commented on Sep 23

    … [Trackback]

    […] Info to that Topic: thereformedbroker.com/2011/12/16/saxo-banks-outrageous-predictions-for-2012/ […]

  4. immediate edge commented on Sep 25

    … [Trackback]

    […] Read More Info here on that Topic: thereformedbroker.com/2011/12/16/saxo-banks-outrageous-predictions-for-2012/ […]

  5. blazing trader reviews commented on Sep 27

    … [Trackback]

    […] Find More to that Topic: thereformedbroker.com/2011/12/16/saxo-banks-outrageous-predictions-for-2012/ […]

  6. 안전놀이터 commented on Oct 16

    … [Trackback]

    […] Info on that Topic: thereformedbroker.com/2011/12/16/saxo-banks-outrageous-predictions-for-2012/ […]

  7. fake rolex commented on Dec 15

    … [Trackback]

    […] Read More on that Topic: thereformedbroker.com/2011/12/16/saxo-banks-outrageous-predictions-for-2012/ […]

  8. nằm mơ thấy hôn môi commented on Dec 22

    … [Trackback]

    […] Here you can find 12685 additional Information on that Topic: thereformedbroker.com/2011/12/16/saxo-banks-outrageous-predictions-for-2012/ […]

  9. 토토 commented on Dec 25

    … [Trackback]

    […] Information to that Topic: thereformedbroker.com/2011/12/16/saxo-banks-outrageous-predictions-for-2012/ […]

  10. tangerine online banking sign-in commented on Jan 13

    … [Trackback]

    […] Find More here on that Topic: thereformedbroker.com/2011/12/16/saxo-banks-outrageous-predictions-for-2012/ […]

  11. CI CD Services commented on Jan 15

    … [Trackback]

    […] There you can find 67932 more Information on that Topic: thereformedbroker.com/2011/12/16/saxo-banks-outrageous-predictions-for-2012/ […]