More Steen Jakobsen, 10 hours ago16 December 2011 Non-Independent Investment Research Sweden and Norway are at risk of replacing Switzerland as the new safe havens – “risk” because, as we saw with Switzerland, becoming a safe haven in a world of devaluing central banks presents a number of risks to a country’s economy. The capital markets of both countries are far smaller than Switzerland, (the combined FX volume in Sweden and Norway being a mere fraction of Switzerland’s), but the Swiss are aggressively devaluing their currency and money managers are looking for new safe havens for capital. At the same time, Germany and its balance sheet are embroiled in the EU debt debacle and the classic safe haven appeal of 10-year Bunds is fading fast. Sweden and Norway sport excellent current account fundamentals, prudent social policies and skilled and flexible labour forces. Flows into the two countries’ government bonds on safe haven appeal becomes popular enough to drive 10-year rates there to more than 100 basis points below the classic safe haven German Bunds.
About Outrageous Predictions
In its Outrageous Predictions, Saxo Bank focuses on events that are unlikely to happen, but at the same time are far more likely than the market appreciates. The predictions are not meant as forecasts, but it is important for investors to consider events with under-recognised probabilities. Should any of them come to pass, they would have a significant impact on the markets. Read all of Saxo Bank's Outrageous Predictions for 2012 here. Downlaod a PDF document containing the Outrageous Predictions here. View a compilation of short videos about them here.
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