There have been some shocks in 2023. A notable one was the US regional bank crisis – no one was expecting it. After all, US banks were supposed to safe after all the post-GFC regulation. When I say no-one, there was one person, Dominique, who wrote in late 2022 that a ‘grey swan’ event for 2023 could be banks needing a capital injection. How prescient! This shows that the Macro Hive annual tradition of listing their grey swans for the year ahead can be more than just a creative exercise. For 2024, we have come up with nine Grey Swans – given our track record, a few of them will surely turn into white swans.
For those who may be unaware, Grey Swans are close cousins to Black Swans: high-impact events that no one expects. Yet to try to predict a Black Swan lands you in something of a paradox. By definition, they are impossible to call in advance. So we prefer the Grey Swan: a low-probability, high-impact event that few expect.
A sovereign crisis in 2012 could not do it. Neither could an immigration crisis in 2015. But a climate policy crisis in 2024 could be what breaks the EU.
2. Investors Discover AGI Has Taken Over Markets
The AI’s owner finally informed the authorities only once repeated attempts to regain control had failed. By then, the AGI had embedded itself into the very plumbing of the financial system.
Entering 2Q 2024, it was becoming clear China’s economy was not emerging beyond the shadow of the Covid pandemic as many had predicted…
With the recent addition of Brazil to the cartel, you might think OPEC+ is growing strong. Here are four reasons why that is not the case – and why 2024 might be the end of OPEC.
5. Biden Withdraws From the US Elections
Markets are pricing zero chance of Biden not being nominated. I think there is more like a 20% chance that Biden pulls out. But if not Biden, then who?
USD/JPY is up over 10% in 2023 and consensus expects steady performance in 2024. What could possibly go wrong?
To borrow the words of Jim McKay in the wide world of currencies, there is nothing like the Turkish lira to give the trader ‘The thrill of victory, and the agony of defeat’!
Within a short ten years, Germany had thrown off the shackles of collective policies on the brink of socialism and became an inspired nation of hope…
9. Arsenal Win the Premier League and Champions League Double
Doing this double would be a dream for an Arsenal fan. But, surely, those of us who love what Pelé called ‘the beautiful game’ are allowed to dream?
(The commentary contained in the above article does not constitute an offer or a solicitation, or a recommendation to implement or liquidate an investment or to carry out any other transaction. It should not be used as a basis for any investment decision or other decision. Any investment decision should be based on appropriate professional advice specific to your needs.)