Every year, Saxo Bank, the Danish investment bank, comes out with its list of the 10 most outrageous events that might affect global finance in the coming year. The outlier events that are out of the norm and might make the unexpected happen, is what the financial organization indulges in annually.
“Some of our forecasts might come to pass, some might not – but they’re all guaranteed to give you a new perspective on the markets and make you think outside the box,” is how the bank describes its annual exercise.
Of course, no one can ignore the pandemic effect, which has seen online businesses and e-commerce, and AI all taking center stage along with the greater focus on green.
And inflation is just right around the corner.
Amazon buys Cyprus
It could relocate its European headquarters to Cyprus and embed itself in the polity there. GDP of Cyprus is just a quarter of what amazon trades in and it could help the country reduce its debt to GDP ratio.
In 2021 there will be a clampdown on monopolies—ergo Facebook.
The whole idea is to pay no taxes by relocating. Amazon paid nearly 3 % tax on $26 billion in profits since 2009.
Germany rescues France
The level of public debt in France has gone up compared to other European countries. It will represent 120% of its GDP in 2021. Corporate debt is also going up. Investors are becoming more pessimistic, which can lead to a sell-off of French megabanks. France will likely ask Germany for help so that the European Central Bank authorizes it to print more money and allow a massive rescue of the system.
Blockchain tech kills fake news
Major social media companies will invest heavily in this tech to save themselves from regulatory scrutiny and the result will be that fake alternative sites peddling conspiracy theories etc. will no longer be relevant. Real news will see a comeback and echo chambers will fade out.
China’s new digital currency inspires tectonic shift in capital flows
China will open up its current account and float a digital currency to rival the dollar as reserve. Its consumption will increase, it will fund a new pension system and overall deepen the country’s capital market. The blockchain system will eliminate fraud and stop capital flight.
Revolutionary fusion design catapults humanity into energy abundance
New fusion technology will alleviate water and food scarcity with desalination and vertical farming. It will allow most countries to be food and energy-rich and start a new era of abundance.
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.
Universal basic income decimates big cities
Will allow youngsters to stay in communities where they grew up and will not be forced to move away.
There will be deurbanization as labor starts moving back to the countryside and even professionals opt to move away from dense overpriced real estate.
With everything available online, no incentive to stay on and work-life balance will change with people preferring to move in relaxed surroundings.
Disruption dividend creates Citizens Technology Fund
2021 will come with a major shift in policy aimed at income adjustment and more equitability. A Citizens Technology Fund is created that transfers asset ownership in capital assets to everyone and a portion of it is given extra to people who have been displaced by digital technology. It is spun as a Disruption Dividend and relieves the social and economic anxiety of people who have been kept out of the economic gains in technology in recent years.
A successful covid-19 vaccine kills companies
The post-vaccine recovery is overheating the economy. The Fed tried to curb it by tightening financial norms. 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.
Silver prices rise and solar power demand goes up
There will be an accelerated increase in the price of silver as its use in industrial products goes up, especially in the photovoltaic cells and the crisis in its supply will frustrate investment in solar energy.
Next-gen tech and emerging markets.
Three areas of technology are set to give a tremendous boost to emerging markets.
The advent of satellite internet, the revolution in fintech technology and banking systems via the digital access through mobiles, and lastly drone technology will improve delivery systems, making the supply chain pipeline more efficient.
Whether all the predictions and prophecies and conjectures come to pass or not is still to be seen. But the technology progress, the changing economy, and lifestyle choices are surely playing out their part out there.
