Hello everyone and welcome to 2014.
The teenies, as this decade is known, is becoming a fascinating decade of change.
From fundamental change in the economic and political world, thanks to the financial crisis of 2008, to fundamental change of society thanks to the technology movements of mobile and tablet computing, this decade is a pinnacle of the forces for change.
I’ll talk about those forces for change through the week, but wanted to kick off with something a little more light-hearted to welcome y’all back to work, so here are some wild predictions for 2014.
First, the Danish bank Saxo Bank sends out a list of ten ‘tongue-in-cheek’ predictions every year. Last year, they predicted a crash in the price of gold, so not all of their predictions are that mad. Of the ten predictions for this year, I was most intrigued by this one:
Tech’s ‘Fat Five’ wake up to a nasty hangover in 2014
While the US information technology sector is trading about 15 percent below the current S&P 500 valuation, a small group of technology stocks are trading at a huge premium of about 700 percent above market valuation. These ’fat five’ – Amazon, Netflix, Twitter, Pandora Media and Yelp – present a new bubble within an old bubble thanks to investors oversubscribing to rare growth scenarios in the aftermath of the financial crisis.
It certainly is the case that there are bubbles out there in the Net 2.0 world. Twitter’s stock price at IPO on November 7 was $26 and it’s now trading near $70, so there’s definitely some fuel for this notion.
The bubble burst theory is quickly followed by quite a few predictions that new tech will buy old tech, e.g. Amazon buy Barnes & Noble and Microsoft buy Yahoo! Why either would happen is beyond me though.
In currency markets Amelia Bourdeau, Director of FX sales at UniCredit AG, talks about a wild year for the dollar:
The euro hit a two-year high against the US dollar on Friday after officials from the European Central Bank and Germany's Bundesbank suggested that European interest rates may be too low. Besides the hit the dollar took again the euro, the US Dollar Index also had its worst day in two months. Meanwhile, this is occurring as the US Federal Reserve Bank begins to taper its bond-buying stimulus program, thus potentially causing a hike in US rates as well. In other words, the coming year could be a wild one in the currency markets.
I thought every year was a wild one in currency markets, so that’s no big doozy.
Barrelperday makes eight bold predictions for 2014, the most unlikely of which is probably this one:
Pope ends celibacy and allows female priests. He tweets: “Jesus probably had a wife. Why shouldn’t we?” The Catholic Church splits, but church attendance and the number of those seeking to become priests soars.
Condoms maybe, but female priests? C'mon, this is only 2014!
Anyways, there’s plenty more out there if you look for it. Meantime, if you have an hour free, here’s Brett King, Jim Marous and I making a few predictions of our own for the banking community: Breaking Banks: the Crystal Ball for 2014 says …