2020 was a year of turmoil, disruption and transformation - as predicted in January 2020.
I failed to correctly anticipate the source of the massive shocks we were about to witness. It was the ultra-tiny Corona virus (aka c19) - instead of Trump (re-election), Boris (Hard Brexit) and Cummings (digitalisation and numeracy of Whitehall) - that triggered 2020 life-changing events. You can't get all the details right, can you?
Main takeaway from the year 2020: size doesn’t matter. Just your talent and potential to transform the world.
Equipped with the wisdom gained and lessons learned over the past 12 months, here are my outrageous predictions for 2021:
1. The year 2021 will prove to be as intellectually stimulating, disruptive and transformative as 2020 was. But c19 won't be the main agent of change.
2. The new c19 UK strain will spread all over Europe and force longer and more severe lockdowns during the 1Q2021 than expected. Vaccination will however prove effective and by August all travel restrictions in the European Union will have been lifted. Do you remember the utopian dream of empty sandy beaches in Southern Europe in the summer? Prepare for dystopia in the summer of 2021.
3. In mid-March financial markets had 7 questions:
a) Is c19 highly deadly or just highly contagious?
b) Will lockdowns flatten the curve (quickly)?
c) Will home office actually work?
d) Will governments and central banks intervene decisively?
e) Will the temporary nationalisation of business life avoid a massive wave of defaults?
f) Once the economies start to open up will we have a quick, V-shaped recovery?
g) Will we have an effective vaccine in less than 2-3 years?
All questions were answered at the most extreme positive end of the initial range of expectations.
With the new c19 UK strain on the rise, and normality taking longer to return than expected, governments and central banks will have to build longer bridges. And they will do whatever it takes to build them.
Markets won't be shocked by c19 anymore. Don’t expect more than a 10%-15% stock market correction even if the newsflow becomes supremely negative (e.g. full lockdowns across Europe till end-March, home office is here to stay, vaccine not fully effective against new c19 UK strain)
4. Bitcoin won't be banned by US and EU authorities. In October the Economist will run a cover story titled " Bitcoin - the digital gold?". Timing is everything.
5. CDU and Greens will form a coalition government following the German general elections in September 2021.
I will vote. Jens Spahn will be Chancellor. Green Annalena Baerbock will be Deputy Chancellor.
A gay head of government. Girl power continuing to be represented at the very top of German political decision-making. Alliance between conservatives and greens at the summit of German politics.
Modernity, diversity and tolerance. Youthful spirit. Brilliant Germany.
6. One of the first measures of the new German government coalition will be to pass legislation making equal time sharing of government paid parental leave for the two parents mandatory.
It’s a tiny measure at first glance. It will do more to break up the still very much patriarchal German job market (especially at the top management level) than 100 (boardroom) quotas for women.
Size doesn’t matter.
7. Massive street protests across Scotland will force the UK government to give in. Scotland will hold an independence referendum in 2022. Nigel Farage founds a new political party: "Scots-don't-get-back-control". What a time to be alive!
8. Joe Biden will engage in negotiations with Xi Jinping to improve US-China relations. No much progress here. By the end of the year Hong-Kong will be fully under Mainland China control. Chinese democracy was a pipe dream.
9. Portugal's new flying football generation will display pure technical beauty at the Euro 2021. Football fans all over the world will fall in love with Cancelo, Rúben Dias, Rafael Guerreiro, Bruno Fernandes, Bernardo Silva, João Félix. Portugal will end the competition as it started it: the European Champion 2016.
10. A meteorite will hit New York in May and wipe out all my predictions - especially the ones related to financial markets. Er.....context man! Stop thinking 2020. In 2021 normality returns and impossible things simply won't happen. Relax people!
11. At the end of December 2021 you will be eagerly awaiting my "Outrageous Predictions for 2022". They will arrive in January 2022. Portuguese punctuality never disappoints.
