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Saxo Bank: Gold falls to $ 1,200 an ounce

Saxo Bank

Expectations of falling German stock market in 2013

Saxo Bank issued, a bank specializing in multiple assets trade and investment via the Internet, released 10 annual predictions for 2013. Includes market forecasts and extremist political events, that may seem unimportant but will have significant impacts on global investment returns during the next year 2013.

Among those expectations that Germany will go towards acceptance of euro debt Exchange that can, with other pressures, causing a decline in Dax by almost one third, and after several years of continued rises to the level of 5,000 points, and predicted that gold would drop by about $ 500 to $ 1200 per ounce with us faster, growth and a stronger dollar, despite continued easy monetary policy for the Federal Reserve Bank.

Expectations are also included the nationalization of major Japanese electronics firms, because of increasing losses, versus more than corresponding Korean industries. While the stronger currency the yen turns around the world to jump against the dollar rates.

And other events that Saxo Bank believes it will have a significant impact if, Spanish interest rates will rise to 10% with the exit of Greece from the eurozone and mounting social tensions and unlink Hong Kong dollar with the US dollar, and linking it to China, with China’s attempt to acquire greater control over economic destiny away from USA and BOJ policies.

The most important adverse events through 2013

He said 60 large economic analysts to Jacobson Saxo Bank this year will be serious negative expectations, which can be any one of them to change the financial landscape, and in some cases will change until the current political situation.

He said that by the end of 2012, there is vulnerability low in all asset classes due to discover the real price caused by Central Bank interventions. In such an environment, almost no movement outside the normative deviations were considered serious.

He added: these ten expectations are not official forecasts to Saxo Bank for 2013, but in any case can prove highly relevant fact for investors because of the significant impact would if any one of them nor new year.

Before trading or investment, investors must know the worst scenarios, capital preservation is imposed and all portfolios should be able to survive in any storm.

The German Dax stock market index is one of the best performing stock markets in the world in 2012 while the continued economic strength in Europe (Germany) profit more from most countries in the euro area, despite the crisis in Europe and slow China’s economic activity, but all that will change in 2013 with the continued slowdown in the Chinese economy which will stop industrial expansion.

This will lead to significant declines of share prices of industrial companies because of weak revenue and declining profits of key players in the industry such as Siemens, BASF, Daimler, which will cause the market to pass a tough time may reduce consumer confidence and lead to lower domestic demand and we shall see through weak retail sales.

At a time when domestic demand will compensate for weak exports, the rates of satisfaction with Chancellor Angela Merkel dropping sharply before the German elections in the third quarter, and in the end would be the deteriorating economic situation is an impediment to its efforts for re-election, and with a weak economy and uncertainty about the new Government will circle the Dax will fall to 5,000 points lower by 33% in 2013.

The Japanese electronics industry will in the end even though they were once the pride of the Empire of the rising sun, after booming electronics industry in South Korea, Samsung has emerged victorious from the competition.

It would be the main reason for the decline in the Japanese electronics industry is greatly oriented approach towards the Japanese market, which led to the fixed cost is high, caused by the very high cost of living in Japan and pensions and the strength of the Japanese currency yen.

With combined losses amounting to 30 billion dollars in the last 12 months ended September 30, 2012, for sharp, Panasonic and Sony companies combined, will this credit rating companies and the Japanese Government will nationalize the electronics industry with a similar method already which is seen by the US Government to rescue the auto industry.

There was no nominal growth in Japanese gross domestic product (GDP) during the eight years out of the last 16 years, as a result of the rescue operations undertaken by the Japanese Government, the Bank of Japan will formulate a nominal GDP target.

The Bank of Japan will expand its budget to nearly 50% of nominal GDP, in order to stimulate inflation and weaken the yen, as a result, the exchange rate of the dollar against the yen will become 90 Yen to the dollar.

Bad weather caused in 2012 in that disaster in global crop production and agriculture decline in inventory value for the ninth year, reflected on the Chicago Stock Exchange prices, which makes its price only any new air disorders both in the United States or South America or China.

Will the increased demand for biofuels in the soybean price to great heights, investors speculators will enter in this sector will pay a high price and potentially by up to 50%, and food security will become an interview at.

The Liberal Democratic Party will return to power, in possession of what is supposed to be an agenda to punish Allen, and only half will be provided by and in the meantime would be a market requires a weak Japanese yen.

Japanese investors will also be part of their trillions of dollars of us investing abroad with a weak risk appetite will return Allen as hard currency to be again the strongest currency in the world.

As will the dollar against the yen to decline to 60 yen against the dollar and the yen will reduce a price in the form of cynical and will return by the Government of the Liberal Democratic Party and Bank of Japan by a more radical action to weaken the yen.

On the other hand, marginal risks will be exacerbated in the European Union, perhaps because of the Italian elections, as a result of the nature of the exit of Greece from the European Monetary Union and fear that Spain and Portugal will follow the same case.

This will drive capital flows to go to Switzerland again, will the Swiss National Bank and the Swiss Government that it is better to abandon a Swiss franc to the euro, rather than to make the reserves accumulate to more than 100% of GDP.

As a result, the exchange rate of the euro against the Swiss franc would have touched the lowest level at all times below parity, before forcing Switzerland to offer the capital controls to curb his power.

As Hong Kong will terminate the link Hong Kong dollar with the US dollar, and the Chinese balrinmenbi will bind him, other Asian countries will show signs of a willingness to follow the same policy, acknowledging the transition of Asian goods business models. The Chinese currency will fluctuate with the easing of China’s grip on currency movements, Hong Kong will grow quickly to become a World Centre for currency trading and currency trading center.

US Treasury bonds

Tell us Treasury bonds with 30-year-old that expected revenue over the next 30 years is the real return of 0.4%. This cannot be sustained in a world of forced inflation by printing banknotes does not permanently and reduce the potential for the United States, if not financial structural reforms.

The Fed is expected to keep interest rates low for longer, but in 2013 it could be subject to challenge the zero interest rate policy forced investors to abandon fixed income for no profit.

Global bond market of 157 trillion dollars in exchange for stock market assessment of 55 trillion, this means that for every $ 1 invested in property rights there are three dollars invested in fixed-income securities. Without a return or even negative return after costing the bond stock becomes an enticing investors.

In return, every reduction of 10% by mutual funds to the value of their bonds, the property rights market will see a net of 30% internally, this may not only lead to higher US interest rates, but also the beginning of the Decade in which equities to outperform bonds and is too late maturity.

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