From Dario Perkins at TS Lombard, December 23:
Since we first published our annual “Things that won’t happen” outlook in 2015, writing outlandish non-forecasts has become considerably more difficult. Back then, nobody would have taken us seriously if we had said Donald Trump would become US president or the UK would quit the EU or there would be a two-year pandemic with rolling global lockdowns. And the surprises kept on coming in 2022. Suddenly we had central bankers who didn’t seem to care about the stock market (except when trading their own PA positions), equity strategists forecasting actual market declines (admittedly only after their first 15 Buy-The-Dip recommendations had failed) and England not winning the World Cup (again). Meanwhile, nobody could have known that cryptocurrencies were just digital tulips or that paying millions for Jpeg monkey pictures – freely available to anyone with a smart phone – was a bad idea. Anyway, humbled by the silliness of real life, here are some things that won’t happen in 2023 (probably…).
#PivotsAreForWimps
In 2022, Jerome Powell made no secret of his admiration for every central bankers’ hero, Paul Volcker, the 6ft7in former Fed chair who famously broke the back of inflation in the early 1980s. Powell promised to learn from the experience of the 1970s and 1980s, ‘keeping at it’ until he had slain the inflation monster once again. But in 2023, after another global energy shock pushes inflation to its highest-ever level, Powell takes his unrequited bromance with Mr Volcker a step too far, donning two-inch platform shoes and a rumpled dark suit and casually puffing on a large cigar at every public engagement. Things get out of hand in August, as US interest rates hit 25% and Powell insists on entering his FOMC press conference to the tune of “Eye of the Tiger”. His embarrassment is complete when he is finally doxxed on #fintwitter as @IHeartVolcker79 (check out his Twitter feed, which is totally dedicated to “Big Paul” and even includes the occassional love poem). Not to be out done, Christine Lagarde tries to revive the ECB’s own monetary heritage, inviting Otmar Issing to run the economics department at the ECB and forcing all officials to read the historical works of Karl-Otto Pöhl. The BoE’s Andrew Bailey treads a path of defiant British exceptionalism, giving a speech on “Why 15% inflation isn’t really that bad”.
.....MUCH MORE
If interested see also:TS Lombard: "Inflation was always the Endgame"
