'Black Swans' 2021: 10 Events That Could Affect Global Finance Next Year
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When it comes to finance, 'black swans' are rare and unexpected events that impact global activity. For example, the coronavirus pandemic that caused a global economic crisis in 2020. As every year, Saxo Bank released its predictions on 10 events that could affect global markets in 2021.
According to the Danish investment bank, specialized in online trading and investment, technology will be the biggest cause of damage to the world's accounts.
Amazon “buys” Cyprus
Amazon plans to move its headquarters from the European Union to Cyprus. The company's tax revenue will help the country reduce its debt-to-GDP ratio by almost 100%. The EU reacts and forces Cyprus and other countries to harmonize tax rules. The United States also joins the fight against these monopolies.
Germany rescues France
The level of public debt in France will represent 120% of its GDP in 2021. Investors are becoming more pessimistic, which will lead to a sell-off of French megabanks. Then, France will ask Germany for help so that the European Central Bank authorizes it to print more money and allow a massive rescue of the system.
A blockchain ends fakenews
Disinformation is on the rise and with it the lack of credibility in the media, leading the industry to respond. A massive shared blockchain network is enabled that will allow the distribution of news in an immutable way with verification of the validity of the content and the source.
Changes in Chinese cash flow
Electronic payment in digital currency would be an electronic version of the Yuan (CNY). The People's Bank of China is looking for a society that uses less cash. The blockchain eliminates the risk of capital flight or illegalities.
Abundance of energy
The MIT Sparc fusion reactor design has been enhanced with Artificial Intelligence, validated in 2020 as a path to fusion power. This created the biggest paradigm shift in energy technology since nuclear power. Wind Power ETF FAN Down 50%.
After an extraordinary year, the SaxoStrats are back with their 10 Outrageous Predictions for 2021.- Saxo Bank (@saxobank) December 9, 2020
Join us for an Outrageous #webinar tomorrow, 10th December at 11.00. https://t.co/uWmni2byvI
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Universal basic income
City offices face 100% overcapacity. Commercial office property values fall. The creation of a Universal Basic Income makes workers and professionals start to leave the big cities. Better balance between work and personal life.
Citizen Technology Fund
There will be new policies to reduce inequality. The 'Citizen Technology Fund' is created, which transfers a part of the ownership of capital assets to everyone, and an additional part goes to vulnerable populations, with productivity gains from the digital age.
The Covid-19 vaccine kills companies
The post-vaccine recovery is overheating the economy. Inflation rises and unemployment falls so rapidly that the Fed allows long-term Treasury yields to rise. Corporate defaults are increasing. Physical retail companies are the first to disappear.
Solar panels and silver
With a covid-19 vaccine in place, excessive liquidity and the policy of excess ease drive a powerful supply on any hard asset. There will be an accelerated increase in the price of silver and the crisis in its supply will frustrate investment in solar energy.
Impact of new technologies
There will be overestimated growth rates in emerging markets, but key technologies can boost private sector productivity, above what has been seen in developed markets in recent decades. It would be a surprise for regions like Latin America.
With information from Saxo Bank .