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What 2018 has in store for the markets

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guest-theritz

David Bowers says it is the “second derivative” that often drives markets—not the change, but the change in the rate of change.

That is the truth. If the VIX is made up of sectors that differ in volatility, or worse, vary significantly, people may not realize that the cause is the variation in your observation. Panic!

llandowner

According to the laws of physics every action (rise) will be followed by some reaction, if not fully so in economics.
But where to hide in an everything bubble?

AlecFahrin

Yes, China is tightening its monetary policy and slowly deleveraging.
But then again, China carried 40% of global growth 2008-2015. Now the rest of the world is growing faster again.
China is both an independent and dependent variable. They will slow down to healthier, less polluted, growth. But they will be picked up by the rest of the world.
Chinese exports will outperform expectations next year, leading to outperformance in their GDP growth. That’s my bet.

daysaccountedfor

One issue with surveys like this is that they often don't tell us about balanced alternatives. The likeliest scenario is that the market continues to rise. But it's a bit like accepting a dollar to play Russian roulette, on grounds that there's a 5/6 chance of a profit.

baldy 63

That there will be another crash is a certainty, the when and how it is triggered is all that is unknown, none of the 'experts' will see it coming until it has already happened is also certain. The problem is that whilst QE may have kept global trade going, it has also distorted both the market and behaviour to such an extent that it has introduced a whole new series of perils into the equation so predicting "outcomes" becomes a job for "Mystic Meg" and her crystal ball rather than "market experts" of any kind.

Still 'Pin the Tail on the Donkey' is a very popular children's game this time of year :)

baldy 63 in reply to Simon Hibbs

Simon

And if they get it wrong ? Well I guess that is the "Creative Destruction" of capitalism at its very best. I always smile and think of the "Scottish Play" and the witches: "When shall we three meet again..." Their prophesy wasn't that helpful in the end was it ?
"Tomorrow, and tomorrow, and tomorrow,
Creeps in this petty pace from day to day,
To the last syllable of recorded time;
And all our yesterdays have lighted fools
The way to dusty death. Out, out, brief candle!
Life's but a walking shadow, a poor player,
That struts and frets his hour upon the stage,
And then is heard no more. It is a tale
Told by an idiot, full of sound and fury,
Signifying nothing."