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It's All About Politicians, Central Bankers And Growth For 2013

Tyler Durden's picture




 

"It’s all about Politicians, Central Bankers and Growth for 2013" is how Deutsche Bank's Jim Reid perfectly sums up the year ahead. While he notes that Central bankers have increasingly eliminated the immediate tail-risk across the globe, he adds that they have not yet found the solution to weak/negative growth and how to successfully de-lever over indebted economies. This argues for a risk-off (periodic growth disappointments), risk-on world (liquidity injections) to continue as far as the eye can see.

We tend to agree that the biggest risk to this comes from politicians. The fiscal cliff is the near-term risk but the Italian elections also loom and execution risk in Spain must be closely watched.

It could be a decent year for markets but with huge risk off moments. It’s difficult to assess where we’ll be in one of these mini-cycles by the time the calendar ticks over into 2014 but trying to trade the large potential swings will likely be key.

 

Beyond 2013, politics will continue to be the key risk in markets. Central banks seem increasingly ‘all-in’ but there is conditionality attached to this in Europe. If politicians drop the ball and renege on promises or get forced by the electorate to embark on a different path against the wishes of the EU/ECB then huge risk aversion could still easily occur. Politics will be a key determinant as to whether the Euro survives over the next few years. We need political stability well beyond 2013 to guarantee this.

2013 is likely to be the seventh year that the financial world operates under extreme conditions/stress and increasingly heavy intervention.

 

Source: Deutsche Bank

 

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Mon, 12/10/2012 - 13:20 | 3048911 HD
HD's picture

ENDLESS. Just endless.

Mon, 12/10/2012 - 13:21 | 3048913 spankfish
spankfish's picture

Is that a dip in your charts or are you just happy to see me?

Mon, 12/10/2012 - 13:22 | 3048915 Samsonov
Samsonov's picture

iTraxx Crossover?  What the heck is that?  Never mind, I don't want to know, but the "it's" that it's all about is actually the algos.  As we see today, the stock-trading robots set the price of the stock market independently of the other stuff mentioned.  I need to understand more about what motivates those robots.

Mon, 12/10/2012 - 13:31 | 3048943 Cthonic
Cthonic's picture

 "what motivates those robots"

The fact that there might be a fraction of a penny available for more than a millesecond to be had by front running some other robot.  Everything else is merely "emergence".

Mon, 12/10/2012 - 13:24 | 3048916 dbTX
dbTX's picture

This chart looks like the Grand Tetons, about as much down as up. I guess it makes growth not so easy in 2013.

Mon, 12/10/2012 - 13:24 | 3048920 Darth Mul
Darth Mul's picture

It's all about toppling Assad then going balls deep into Iran for the petrodollar, gas pipelines, and Eretz Israel as we pass the peak of oil production.

Everything else is secondary.

 

Even the coming of the Messiah, bitches.

 

 

Mon, 12/10/2012 - 13:26 | 3048927 Everybodys All ...
Everybodys All American's picture

Russian roulette has better odds of success.

Mon, 12/10/2012 - 13:27 | 3048933 ekm
ekm's picture

Zerohedge is driving me nuts with this "negative growth".

 

Call it CONTRACTION, please.

Mon, 12/10/2012 - 13:28 | 3048938 buzzsaw99
buzzsaw99's picture

shrinkage bitchez

Mon, 12/10/2012 - 13:31 | 3048945 CPL
CPL's picture

Can't use the old words anymore.  Nobody knows what they mean.

 

It's a double-plus ungood word.  The motherland would be displeased.

Mon, 12/10/2012 - 13:58 | 3048964 crusty curmudgeon
crusty curmudgeon's picture

+1 ekm

 

Riddle:  If you call a tail a leg, how many legs does a dog have?

Answer:  Four.  Calling a tail a leg doesn't make it one.

 

"We are men of honor.  Lies do not become us."  -Dread Pirate Roberts

Mon, 12/10/2012 - 13:40 | 3048974 fonzannoon
fonzannoon's picture

EKM Contraction is a doomer term. You need to come in out of the cold. "Marginally less awesomeness" would be better than contraction or negative growth.

 

Mon, 12/10/2012 - 13:29 | 3048939 tooriskytoinvest
tooriskytoinvest's picture

The US Economy's Future Just Got Much Darker: Big Money Is Either Going Into Hibernation Or Being Paid Out To Shareholders While Things Are Getting Significantly Worse In EU, Japan, And China.

http://investmentwatchblog.com/the-us-economys-future-just-got-much-darker-big-money-is-either-going-into-hibernation-or-being-paid-out-to-shareholders-while-things-are-getting-significantly-worse-in-eu-japan-and-china/

Mon, 12/10/2012 - 13:33 | 3048956 CPL
CPL's picture

Cast your net wider and start using google translator to read other languages.

 

The picture should be clear enough that everyone is up to their eyeballs in debt and unable to move capital anywhere, mainly because that is the effect of hyperinflation.

 

Everyone is "rich" but there is nothing to invest into or buy because if you buy something there won't be a buyer on the otherside of the investment.  So everyone sticks to what they use everyday and can use themselves.  Hence the reason the land/PM/oil trades happening.

Mon, 12/10/2012 - 13:36 | 3048951 SheepDog-One
SheepDog-One's picture

AH yes I see....basically some stuff will happen all year, and Dec 2013 we'll be just about where we are today then....uh huh, sure.

Mon, 12/10/2012 - 13:48 | 3049007 pods
pods's picture

I think this kind of sums it up:

You load sixteen tons, what do you get
Another day older and deeper in debt

Mon, 12/10/2012 - 13:34 | 3048957 Dr. Engali
Dr. Engali's picture

Imagine that .. A bank pushing risk on buy stocks meme. Fucking countdown clock in CNBC for the fiscal cliff. What a piece of worthless shit station.

Mon, 12/10/2012 - 13:57 | 3049043 knukles
knukles's picture

Rise Above

(tears welling)

Mon, 12/10/2012 - 23:28 | 3050845 StychoKiller
StychoKiller's picture

[quote]

Winston, sitting in a blissful dream, paid no attention as his glass was filled up.  He was not running or cheering any longer.  He was back in the Ministry of Love, with everything forgiven, his soul white as snow. He was in the public dock, confessing everything, implicating everybody.  He was walking down the white-tiled corridor, with the feeling of walking in sunlight, and an armed guard at his back.  The long-hoped-for bullet was entering his brain.

He gazed up at the enormous face.  Forty years it had taken him to learn what kind of smile was hidden beneath the dark moustache.  O cruel, needless misunderstanding!  O stubborn, self-willed exile from the loving breast!  Two gin-scented tears trickled down the sides of his nose.  But it was all right, everything was all right, the struggle was finished.  He had won the victory over himself.  He loved Big Brother.

[/quote]

Mon, 12/10/2012 - 13:35 | 3048959 fonzannoon
fonzannoon's picture

Nice....so another quiet year of interest rates going full blown negative while the debt ceiling barrels towards 20 trillion. Another year of low paying service sector jobs created for aging boomers trying to hang on and 20's somethings buried in debt holding out for management. Another year of almost everyone trying to hang on. Sounds good. Thanks for the update.

Mon, 12/10/2012 - 13:38 | 3048971 SheepDog-One
SheepDog-One's picture

Yep! Basically just slap some more gymnast rosin on our hands and hang on tite for another year, where they've already figured we'll be just about where we are now, on 'I-Traxx' anyway.

Mon, 12/10/2012 - 13:42 | 3048981 Cult of Criminality
Cult of Criminality's picture

 

Off Topic;

I still have some Goldman Sachs Knife sets for sale.They make a great Christmas gift or for any occasion really.

Still just derivative priced ..get yours today !!

Only one set left with the clients blood still on it, Priced at National deficit.

Mon, 12/10/2012 - 13:41 | 3048983 pupton
pupton's picture

"Monti stays on"???  Didn't he just announce this morning that he's resigning?

Mon, 12/10/2012 - 13:57 | 3049047 knukles
knukles's picture

That Italian sign language gets really tough when they talk fast.

Mon, 12/10/2012 - 14:05 | 3049065 Iam Yue2
Iam Yue2's picture

Are you sure that you have cast your net wide enough?

Mon, 12/10/2012 - 14:18 | 3049111 SmoothCoolSmoke
SmoothCoolSmoke's picture

2013:  Despite all our rage we are still just rats in a (Bankster's) cage.

Mon, 12/10/2012 - 19:23 | 3050107 LooseLee
LooseLee's picture

"It could be a decent year for markets"? Based on what? Money printing? If that's all you got, better find another plan...

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