We have a few days before we transition into 2018. It is prime time for us to look back at 2017, relish the stuff that went well, promise ourselves not to repeat our mistakes, make our new year resolutions and wonder what 2018 will be like.

Saxo Bank has published their set of outrageous predictions for 2018. See reference link at the end of this post. I summarise them in this post for your reading pleasure. Naturally, these predictions are intended for their global investment clientele. Despite that, I hope you still enjoy it.

Outrageous Predictions for 2018

1. Russia and China Will Engineer a Bitcoin Crash

Although the Bitcoin price will continue to rise and peak in 2018, China and Russia will work together to crash bitcoin to it's fundamental 'production cost' of USD 1,000. Both countries will strive to develop state sanctioned cryptocurrencies to quell the outflow of capital from their shores.

2. US Voters Turn Hard Left

With the dismal failure of Trump's brand of populism and potential incarceration of members of his cabal, a growing cohort of under-35 millennials will drive US politics towards the left as they suffer the consequences of a spiralling public deficit and a likely recession.

3. ‘Austro-Hungarians’ Launch Hostile EU Takeover

Tensions in the European Union boil over as the divide between the old core members of the EU and the more newer and sceptical members widen to an impassable chasm. The shift in the centre of gravity from the Franco-German to the Visegard-and-friends is expected to have severe consequences to the Euro. If this scenario plays out, the Euro may reach parity to the USD.

4. China Issues CNY-Denominated Oil Futures Contract

With waning US influence on the international stage and fossil fuel producers happy to trade in Chinese Yuan (CNY) with the world's largest importer, Shanghai International Energy Exchange's decision to launch a yuan based crude oil future is expected to be a runaway success.

5. Bank of Japan Abandons Yield Curve Control

As inflation rises and soft global interest rate yields collapses, Japan will be forced to abandon it's yield curve control. The USD-YEN exchange rate reaches 150 as the yen plunges.

6. South Africa Resurgent after ‘African Spring’

South Africa may lead political and economic growth in the southern region of the continent in 2018. This will have a positive contagion further north as she delivers the world's strongest growth rates - up to 33% against the G3 currencies.

7. Women Smash the Glass Ceiling

Female representation in the highest levels of executive boards will rise as more women achieve higher education levels and prove themselves in the business world. We can expect a substantial increase of more than 60 female CEOs at the top Fortune 500 companies.

8. Stock Market Flash Crash Spikes Volatility

The last global financial crisis occurred in 2008. We have learnt to expect these cyclical crashes and it may appear that one is due by 2018. Although the equity and real estate markets are near record levels, the drivers of bubbly asset values - quantitative easing tactics, interest rate targeting, low interest rates - are aggravating imbalances and weakening the financial system.

The outrageous prediction is that with the ballooning imbalances, the S&P 500 will plunge by 25% in a spectacular flash crash.

9. Tencent topples Apple as Market Cap King

China still has the world's largest population that is advancing economically. She is opening up it's capital markets and with rising living standards and economic prosperity in the 'lucky year of the dog', Chinese companies are expected to surge past their US counterparts in 2018. Tencent in particular is a spectacular example of a USD 100 billion Chinese company that delivered 60% year-on-year top line revenue growth in 2017Q3 with a rise in operating income of 50%.

The outrageous prediction is that Tencent will surpass Apple's USD 1 trillion market cap in 2018.

10. Fed Loses Independence as US Treasury Takes Charge

The Fed's independence has fluctuated based on the needs of the federal government. The prediction is that the bond market will collapse in 2018 and this will trigger the Treasury Department to intervene to cap yields at 2.5%.

If any of these predictions do play out in 2018, the world as we know it will experience rather radical changes. Some of these predictions tend to foretell doom and gloom. The good news is that like economists, these outrageous predictions by financial 'experts' may not bear out. So do not fret unnecessarily.

Best wishes for a great 2018!

PS: For additional details, please refer to the reference indicated below.

Image Credit: Photo by Ramón Salinero on Unsplash

Reference: Saxo Bank Presents Outrageous Predictions for 2018