Second Set of Gray-Swan Shocks To Watch in 2018

Second Set of Gray-Swan Shocks To Watch in 2018

In my previous piece, I examined five gray swans that are already in view, but could fly in to roost in the year ahead. That’s the first half of the list of 10 ugly goslings that the Japanese investment bank Nomura sees as potential surprises in 2018.

Black swans are completely unexpected, and therefore can’t be predicted. Gray swans are a little different, neither hidden nor invisible, just largely ignored.

The investment bank has sought to identify situations that are a little out of the ordinary. We know that Donald Trump will be unpredictable — what he does is a known unknown. These birds fall into the camp of the unknown unknowns.

Here’s how cryptocurrencies, Bitcoin, house-price declines, war in the Middle East, oil prices and central banks may shock us in 2018.

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China’s New Leaders Are No Threat to President Xi

China’s New Leaders Are No Threat to President Xi

China’s new roster of top leaders have shuffled into their places on the red carpet for their curtain call, the procession leaving no question as to who is in charge. President Xi Jinping has been reappointed to head the Communist Party, with no one waiting in the wings as his nominated heir.

What’s more, not one of the new members of the Politburo Standing Committee, China’s cabinet, is under the age of 60, meaning none of them is likely to succeed Xi when and if he stands down at the end of his second term in 2022.

It’s a highly unusual move, unprecedented in recent years, leaving Xi to continue his push for reform and fight against corruption unquestioned. Critics worry that Xi’s “rule” has evolved into a dictatorship, the president eliminating rivals who question his positions and squelching stories about his family’s amassed wealth.

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