Review of 2013- Part 1 – Europe, Middle East and Africa
Uk- Obviously I highlighted the key themes of the year (
benefits, Shale, wealth and property) but can claim little credit for these as
they were all evident already in 2012, but still there is a lot of very exactly
timed stuff to recommend this forecast.
|
Month
|
Prediction
|
Outcome
|
|
Feb-mar
|
Negative
|
Late feb credit rating downgrade
|
|
Mar
|
Problems re partners
|
Euro – due to Cyprus
|
|
April
|
Events – open up to world
|
Thatcher funeral
|
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July
|
Positive sentiment ( Royal baby already known)
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Baby and Murray wimbledom win etc
|
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Aug
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Critical time
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Syria decision
|
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Dec
|
Benefits in news
|
Migrant benefits – Romania etc
|
FTSE
Excepting a short sharp decline in June this was a rather
good market forecast
|
Month
|
Prediction
|
Outcome
|
|
Feb
|
More rises – exuberant
|
More rises
|
|
Mar
|
New highs
|
New highs
|
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April
|
Mixed
|
Yes
|
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May
|
Flat
|
Rose a lot
|
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June
|
Flat
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Fell
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July/aug
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Unusual activity for summer
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Yes – due to Syria and EM mkts
|
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Sep - Oct
|
Frothy
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Talk of valuations led to fall in Oct
|
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Dec
|
Momentum cont.
|
Year end high
|
BOE/Sterling
Difficult to segregate the movement of Sterling throughout
the year as it fell somewhere in the middle of the developed world currencies ,
$, Euro and Swiss.so the rather noncommittal forecast was spot on. These ‘not a
lot will happen’ ones are often
difficult as there is a temptation to talk about trivial movements rather than
say nothing
|
Month
|
Prediction
|
Outcome
|
|
Jan Feb
|
No significant changes
|
Fell a bit
|
|
Mar
|
Unexpected announcements – physical changes
|
Rating change ( late feb)- April – new £5 with Churchill (*)
|
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April/May
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BOE internal changes only
|
Flat or volatile within ranges
|
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July/aug-Sept
|
New feel by Sept
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Rose from mid Aug
|
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Oct/Nov
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Some policy tensions
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Issues about targets and stopping easing as stats looked better
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Dec
|
As start of year –perhaps brief weakness – nothing lasting
|
Against CHF Sterling was basically unchanged on year
(*) announced this will be first plastic note
|
Euro
Cyprus timing spot on and a reasonable attempt at the rest although
the exact timing of the German French agreements was out by a month. And the
leadership issues seemed more about rates than the ECB leader himself. A good
call on October being as much about $ as Euro.
|
Month
|
Prediction
|
Outcome
|
|
Feb- march
|
Challenges including to leadership
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Cyprus. Volatile March VS chf but rose vs $
|
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April-May
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Leadership issues but not value ones
|
Fell April and May vs. CHF & $
Rate cut to lowest ever May
|
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June-Jul
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Some value issues. Possible accord re bonds or something
|
Rise in june then fall and rise
Rate unchanged
|
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Aug
|
Leadership questions, unexpected announcements , not so much value changes
|
Relatively flat
Accord by France and Germany to work on closer Euro financial
ties
|
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Sept
|
Shift in exchange rates following August events
|
Rise vs dollar – little change vs CHF
|
|
Oct
|
Some drama on currency scene – could be Euro or US -volatile but no
long term trend
|
US – budget ceiling – Euro rose
|
|
Nov-Dec
|
Turning point – possible change of heart by Euro countries
|
Fell against dollar then rose again – Flattish vs CHF. Announcement
re common fund etc by France & Germany
|
Germany
Clearly the very precise Merkel forecast makes this an
overall winner.
|
Month
|
Prediction
|
Outcome
|
|
March
|
Problems specially re partners
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Cyprus
|
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April
|
Global image
|
Continued Cyprus
|
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May
|
More benign but leadership difficulties
|
Questions over Merkel communist past
|
|
June
|
Mixed - overreaching
|
Floods
|
|
July – Aug
|
More challenging
|
Moderate general difficulties
|
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Late Aug
|
Better
|
Good stats support Merkel
|
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Sept
|
Merkel re-elected – but
|
Merkel re-elected – but
|
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Oct
|
Difficulty with policy as no outright control
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Took until Nov to form coalition
|
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Dec
|
Difficult – particularly for leadership
|
Economic mood positive, but questions over succession
|
France
A country that went nowhere in 2013, so difficult to get a
handle on it
|
Month
|
Prediction
|
Outcome
|
|
Mar
|
Worst situation since start of crisis
|
Unemployment at 16 year high
|
|
April
|
Better than expected
|
Not really better at all
|
|
May
|
Difficult but will soldier on
|
Cabinet reshuffle
|
|
June
|
Difficult but will soldier on
|
Deficit forecasts downgraded
|
|
Aug-Sep
|
Challenges for public
Mali- like situation
|
2% growth second quarter
But Syria dominated – France took heavy approach
|
|
Oct
|
Mixed – some shocks
|
Local elections – right wing successes. Ongoing tax issues
|
|
Nov-Dec
|
More restrictions, leader has problems, but possible good economic
news
|
better 3rd quarter stats, Ratings downgrade but rise in
sentiment
|
Spain
I did well on this one; but for some reason this 500 year
old chart is one of the best
|
Month
|
Prediction
|
Outcome
|
|
Mar-may
|
Some light at the end of the tunnel
|
Austerity but with long term aims in mind.
|
|
June
|
Dissent though some short term economic positives
|
Bárcenas jailed due to
corruption scandal. But IMF said the country was making progress
|
|
Jul-Aug
|
Low point – will improve now
|
Train crash.
Rajoy challenged due to corruption allegations But ‘ The Spanish
economy may finally be about to turn the corner’, FT 30 july .
|
|
Sep
|
Better Stats – but difficult for leadership
|
Started to pull out of recession in 3rd quarter.
Independence vote by Catalonia
|
|
Oct-Dec
|
Much better sentiment
|
Spain grew at its fastest for 6 years despite young unemployment
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Italy
Italy was also a relatively good prediction though I’m less
sure how good this one will be in the next years.
|
Month
|
Prediction
|
Outcome
|
|
Feb-Mar
|
Made in 2008 – that after a good year one could not be sure of good
outcome next
|
Elections a shambles – with comedian winning and downgrade received
|
|
April
|
Some improvement but still inertia economically
|
|
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May
|
Not significant – good news may be misleading
|
Coalition finally formed but economic mess
|
|
June
|
Heated debate – but government still unable to press forward
|
fragile coalition government has closed ranks
around a budget-neutral decree intended to boost the recession-hit economy
while putting off decisions on controversial tax cuts
|
|
Jul- Aug
|
Better – some progress
|
While growth was marginally better than expected, the picture
still looks bleak with businesses failing faster
|
|
Sep-Oct
|
Maybe some positive economic
developments – although core issues remain
|
Ministers resign from coaltion
Unemployment worst sinc e1977, poor 3rd quarter though 4th
may be better
|
|
Dec
|
Clinging to past even though there is opportunity for future
|
Weak signs of recovery Third-quarter gross domestic product
(GDP) data signalling that Italy could be about to emerge from two and a half
years of recession not matched with jobs growth due to structural
issues
|
Ireland
Another pretty good assessment of developments
|
Month
|
Prediction
|
Outcome
|
|
Mar-May
|
Uncertainty but Nothing to significant
|
Slight concerns about
forecasts but no significant reduction
|
|
June July
|
Renewed energy but it is a challenge to get things moving
|
Restricted repayment of bailout giving more opportunity but latest
stats show country back in recession 17% of owner occupiers are having trouble paying their
mortgages. And employment remained high
|
|
Aug-Sep
|
New mood – appreciation of the positives
|
Rebound in economy
|
|
Nov-Dec
|
Mood continues but a return to
preoccupation with debt
|
Ireland's
GDP may now be rising and unemployment may be falling, Sentiment best since
2007 bailout programme put
in place by international lenders in 2010 came to an end
|
Switzerland
Yawn!
|
Month
|
Prediction
|
Outcome
|
|
Pre Oct
|
N/a – already happened
|
n/a
|
|
Oct
|
Should be trouble free
|
Growth forecast raised – still in super cycle
|
|
Nov-Dec
|
Awareness that things might not always be ok but no real problems
|
Good Q3 stats released
ZURICH, Dec 19 (Reuters) -
Switzerland's economy is poised for stronger growth in coming years, buoyed by a recovery
of exports, but remains at risk from the fragility of the global economic
recovery, the Swiss government said.
|
Greece
More ticks
|
Month
|
Prediction
|
Outcome
|
|
Pre May
|
N/A – already happened
|
n/a
|
|
May
|
Relative stability
|
Greece's battered debt
ratings received a rare upgrade from Fitch which noted "clear
progress" on eliminating deficits.
|
|
June-Aug
|
Difficult, entrenched with protests
|
Cabinet
reshuffle unemployment rate stands at a record of almost 28%, and threats of
further job cuts have led to strikes and civil unrest, that economists worry
could jeopardise further economic recovery.
|
|
Sep-dec
|
Small turning point but continued disaffection and a lot of hot air
|
Improved borrowing rates and signs of improvement but still strikes
and The group known as the 'Troika' remains
at loggerheads with the government
|
Iceland
Not a lot predicted
and not a lot reported.
|
Month
|
Prediction
|
Outcome
|
|
Pre Sep
|
N/A – already happened
|
N/A
|
|
Sept
|
Not significant
|
Just some expected positive stats
|
|
Oct
|
Restrictions and some dissatisfaction
|
Iceland's economy is recovering but it is still in crisis with
capital controls reducing the potential for foreign investment and this month
the central bank warned that Iceland’s private sector faces the risk of being unable to repay
its foreign currency debt.
|
|
Nov
|
disillusionment , possible water issues
|
Icelandic entrepreneur says his company may have a novel
solution to the world’s water shortages: Also country seeking finance for
undersea cable
|
|
Dec
|
Not noteworthy
|
Nothing new
|
Russia
Not very exciting but
pretty much on the money again
|
Month
|
Prediction
|
Outcome
|
|
Pre Oct
|
N/a – already happened
|
n/a
|
|
oct
|
Leadership will need to compromise more
|
Russia dropped Greenpeace charges
|
|
Nov-Dec
|
Strong leadership with support but economic position mixed. Some
unexpected benefits
|
Pussy riot members to be released.
Putin tightened grip on legal system and shook up state media, threatened
crackdown on offshoring. Country slashed long term growth forecasts and bank
warned of household debts but market more stable
|
Turkey
Timing was a bit out
– did not expect this effect until January 2014
|
Month
|
Prediction
|
Outcome
|
|
Pre Nov
|
N/a – already happened
|
n/a
|
|
Nov-Dec
|
Largely positive – short term lira and market uplifts
|
Reshuffle by president 25th dec. in response to corruption
scandals
Lira was flat until December but then fell due to reshuffle issues
etc. The market also fell
|
Saudi
Yawn ( though unlike
Switzerland this is about to change)
|
Month
|
Prediction
|
Outcome
|
|
Pre Nov
|
N/a – already happened
|
n/a
|
|
Nov-Dec
|
Largely benign
|
Nothing new
|
Iran
Such short forecasts
– not really worth worrying about, but accurate nevertheless
|
Month
|
Prediction
|
Outcome
|
|
Pre Nov
|
N/a – already happened
|
n/a
|
|
Nov-Dec
|
For the most part the last two months of the year are positive-
though no radical changes. Uranium devels
|
Nuclear deaL with US. Expects reduced sanctions Opened talks with oil
cos
|
Israel
Israel is never
interesting
|
Month
|
Prediction
|
Outcome
|
|
Pre Nov
|
N/a – already happened
|
n/a
|
|
Nov-Dec
|
The coming months look challenging for the country as it is prevented
from making much headway with its strategies. There may also be more
government spending restrictions
|
Israel objected to US Iran dealings.
Rates were kept fixed with no further loosening planned. But growth
in 2013 was at a 10 year low
|
South Africa
Should have forecast
Mandela death ( though irrelevant for my purposes) but ok otherwise
|
Month
|
Prediction
|
Outcome
|
|
Pre Nov
|
N/a – already happened
|
n/a
|
|
Nov-Dec
|
While these concerns [mandela, strikes, growth falls] aren’t going
away the remainder of the year looks to be relatively uneventful however.
|
Mandela’s death probably doesn’t class as uneventful but economically
and politically it did put events pretty much on hold for the last month of
the year.
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