Saxo Bank's predictions always focus on a series of unlikely but underappreciated events which, if they were to occur, could send shockwaves across financial markets.

While these predictions do not constitute Saxo’s official market forecasts for 2019, they represent a warning of a potential misallocation of risk among investors who typically see just a one percent likelihood to these events materialising.

The Outrageous Predictions for 2019 are:

  • EU announces a debt jubilee
  • Prime Minister Jeremy Corbyn sends GBP/USD to parity
  • Donald Trump tells Jerome Powell «you’re fired»
  • Germany enters recession
  • Apple «secures funding» for Tesla at $520/share
  • Corporate credit crunch pushes Netflix into GE’s vortex
  • IMF and World Bank announce intent to stop measuring GDP, focus instead on productivity
  • Global Transportation Tax (GTT) enacted as climate panic spreads
  • X-Class solar flare creates chaos and inflicts $2 trillion of damage
  • Australia launches «TARP Down Under» after nationalising the big four banks

Chief Economist at Saxo Bank, Steen Jakobsen thinks this year’s edition has a unifying theme of «enough is enough». A world running on empty will have to wake up and start creating reforms, not because it wants to but because it has to. The signs are everywhere.

Signs of Strain

He believes that 2019 will mark a profound pivot away from this mentality as we are reaching the end of the road in piling on new debt and next year will see us all beginning to pay the piper for our errant ways.

The great credit cycle is already showing signs of strain in late 2018 and will rip through developed markets next year as central banks are sent back to the drawing board. After all, their money printing efforts since 2008 have only dug a deeper debt hole, and it has now grown beyond their mandate to manage.