What lies ahead in the year 2008? Recession in Great Britain, plummeting of the S&P 500, share prices falling by 40% on the Chinese stock exchange, increase in the oil price to 175 dollars per barrel, continuing weakness of the G3 currencies US dollar, Euro and Yen. If these “Outrageous Predictions” by the Saxo Bank in Kopenhagen were to become true in the year 2008, the economy would have to face up to a bleak future.
One part of the annual outlook by the Saxo online investment bank in its “Outrageous Predictions” is the attempt to spot extraordinary developments on global markets. This year the bank presented quite an uncanny forecast – uncanny because some of its “Outrageous Predictions” made in the past turned out to be correct. According to the bank, almost one quarter of its forecasts for 2007 became almost or completely reality such as the prediction that the US key interest rate would amount to 4% in 2007. The bank´s forecast with regard to the US building and construction business was also very pessimistic at the start of last year thus predicting the course of future events correctly.
However, it remains to be hoped that of these bleak forecasts as few as possible will come true.
Here the predictions made by Saxo Bank for 2008:
- Ron Paul wins the 2008 presidential elections in the USA
- The S&P index falls from its record high in 2007 by 25% to 1.182 points
- EUR/SEK falls to 8.8000 (currently 9.4000)
- USD/SGD falls to 1.4000, but then increases to 1.6000 (currently 1.6000)
- EUR/HUF rises to 275
- at least three of the ten most important US construction companies will file for insolvency
- the Chinese stock exchange will plummet by 40% by late summer
- prices for cereals will once again double
- The oil price will rise to 175 dollar per barrel
- Great Britain´s economy will shrink