Market revolution

Steen Jakobsen, Chief Investment Officer at Saxo Bank, stated that there is a growing probability of a revolution in the global financial markets - a paradigm shift. “Our intent is the broader definition of revolution: not the physical overthrowing of governments, but eureka-like moments that trigger a change of thinking, a change of behavior and a rejection of the unsustainable status quo,” Jakobsen clarified. These upcoming changes could shake up the existing state of affairs.

New cold war and renewed space race

In 2022, a new cold war could lead to a renewed space race, fuelled by recent hypersonic missile tests in countries such as China. “The latest hypersonic missile tests are driving a widening sense of insecurity as this tech renders legacy conventional and even nuclear military hardware obsolete. In 2022 a massive hypersonic arms race develops among major militaries as no country wants to feel left behind,” John Hardy, head of FX strategy at Saxo Bank wrote. Most major powers would join the race, leading to massive funding for aerospace companies developing hypersonic and space hardware.

Plans to end fossil fuels temporarily suspended

In 2022, amid growing debate over ending the use of fossil fuels and shifting to renewable energy, policymakers could come to an unexpected decision. “Faced with rapidly rising commodity prices and an increasingly impossible road to carbon neutrality, policymakers make a surprise and controversial move in 2022 to temporarily relax environmental restrictions on new upstream crude oil and natural gas investments for five and ten years, respectively,” writes Ole Hansen, head of commodity strategy at Saxo Bank. According to Hansen, this plan could be presented as the only way to reach a low-carbon future while also limiting the risk of social unrest caused by rising food and energy prices.

Young users abandon Facebook’s platforms

A rising protest against Facebook’s mining of personal data for profit could lead to young users abandoning the tech giant’s social media platforms in 2022, with the Metaverse failing to entice the youth. This would result in a massive shake-up for the tech industry. “Facebook is suddenly in the midst of a cultural war between young people under 40 and adults over 40, with young people seeing Facebook representing the evil boomer generation of fake news and greedy corporations,” Peter Garnry, Saxo Bank’s Head of Equity Strategy predicted. “In 2022, investors will realize that Meta is rapidly losing the young generation and thus the future potential and profitability of the company”, he added.

Spotify faces competition from NFT-based service

In 2022, a new digital music platform using the NFT technology could become a serious competitor for services such as Spotify. “Musicians feel unfairly treated by the revenue sharing models of the current streaming platforms like Spotify and Apple Music,” Mads Eberhardt, Saxo Bank’s cryptocurrency analyst noted. A new platform using NFTs and smart blockchain contracts would help musicians and performers bring them back their share of industry revenues, allowing them to distribute their music without centralized intermediaries, track their income, and get paid in real time, Eberhardt predicted.

US constitutional crisis

The midterm elections in the US could lead to a political stand-off in 2022, Saxo Bank’s John Hardy predicted. “In the wake of the 2022 election, a handful of key Senate and House races come down to the wire and one or both sides move against certifying the vote, making it impossible for the new Congress to form and sit on its scheduled first day of January 3, 2023. Joe Biden rules by decree and US democracy is suspended,” he wrote. “As 2023 gets underway, the stand-off sees a full-blown constitutional crisis stretching over the horizon.”

Massive global stock market imbalance

A constitutional crisis in the US after the 2022 midterm elections would cause extreme volatility in US assets, negatively impacting the global stock market. In this scenario, “US Treasury yields rise and USD drops on hedging against the existential crisis in the world’s largest economy and issuer of the world’s reserve currency of choice”, Saxo Bank’s John Hardy noted.

Women trader army takes on stock market

Another scenario by Saxo Bank sees a rise of women traders in 2022. Using tactics similar to those employed by Reddit’s so-called “investor army” in early 2021, these traders would launch a coordinated long squeeze of stocks by selected companies with low gender equality, causing huge swings in equity prices for targeted companies.

Biomedical breakthrough extends life expectancy

Developments in biomedical research could result in a significant breakthrough in 2022, pushing productivity and life expectancy up. “A cocktail of treatments is put together that tweaks cell-level processes in order to extend their life and thus the life of the organism composed of those cells… The implication for humans is the possibility that average life expectancy can be extended by 25 years or more, and with it the incredible prospect in the future that age 80 will be the new 50,” Saxo Bank’s Steen Jakobsen predicted. “Not only that, but this future is open to older humans too, as the new fountain of youth treatment can slow and even rejuvenate already old cells,” he added. While this new treatment would be beneficial for mankind, it would raise massive ethical questions demanding an immediate resolution.

EU superfund created from private pensions

The EU could create a $3 trillion superfund for financing climate, energy, and defense spending, Christopher Dembik, Saxo Bank’s Head of Macroeconomic Research predicted. The new fund could be financed from private pensions of EU countries. It would be focused on the three-fold priorities of defense, climate, and the related clean energy transition, Dembik added.