Dear All,
Happy New Year!I’m spending too much time in the Metaverse - some call it Financial Markets - these days and almost missed that 2022 had already started.
But worry not. I did not forget that you need my guidance to walk confidently through 2022. So here they are - my outrageous predictions for 2022:
1. By the end of 2022 everyone will be asking: "remind me, what was that covid thing again"?
2. Companies are building inventory so aggressively that we will end up with an excess supply of durable goods in the 2H2022. Meaning: wait until September to buy that new coffee machine. Fridge. Bike. Car. Or start your flat refurbishment. It will be (much) cheaper then. Durable goods deflation is a beautiful thing.
3. With US inflation proving to be more persistent than initially expected, the Fed will have to decide between fighting inflation aggressively or protect asset prices. Protect the poor or the rich. In full compliance with its mandate, it chooses the former. And it panics, tightening monetary policy much more aggressively than expected (and necessary). Stock markets collapse: peak-to-trough the S&P 500 loses 30%. The Nasdaq 40%. Tesla 60%. Meme stocks anyone?
4. It will be the year of the great re-opening. And revenge travelling will take off decisively. Book your holidays for the next 2 years. Now! (PS Travel & Leisure stocks will be some of the very few with a positive performance for the year. Just saying).
5. Boris will still be British PM in December, proving that Brits have a brilliant sense of humour. The world’s best. What is there not to like about a good party anyway?
6. Putin invades Ukraine. Better now than after it becomes a NATO member, his rationale goes. The Nordstream 2 gas pipeline is discontinued. US and Middle East (more expensive) LNG replace Russian gas in the EU. The green energy revolution will pick up speed - and yes, nuclear energy will be part of the new green.
7. In the US, the democrats will lose the mid-term elections. Sorry Joe!
8. By the end of the year, Trump will be by far the most popular politician in the US. Encouraged by his rising popularity, he sets course for world domination: he announces a Deutsche Bank debt financed takeover bid for Twitter.
9. In December, the football World Cup will take place in Qatar. For the first time in living memory, English players will not arrive at a major international tournament in much worse physical shape, after a long Premier League season, than their rivals. Given England’s strong squad, they are serious contenders to win the title. Christmas will see record alcohol sales in England. “Drink teams“ will be formed all over the nation to forget the “dream team’s” failure to win the World Cup. Consolation prize: Germany won't win either. Can’t wait for that roaring party at number 10!
10. At the end of December you will be eagerly awaiting my outrageous predictions for 2023. I’ll send them out in January. The Metaverse is very addictive indeed.
