- Danish asset manager Saxo Bank has released its list of outrageous predictions for the markets in 2022.
- They include the drop in Spotify shares as musicians use NFTs to create revenue share.
- Another prediction sees US inflation soar to 15% and the Fed raising interest rates too late.
NFTs taking over the music industry from Spotify, US inflation hitting double-digit rates, and female traders banding together to put epic pressure on “patriarch companies” are part of Saxo’s outrageous market predictions Bank for 2022.
The Danish asset manager’s annual list has a revolutionary theme this year and includes wacky scenarios as well as more plausible scenarios.
“As culture wars rage across the world, it is no longer a question of whether we are going to have a socio-economic revolution, but of when and how,” Saxo Bank said.
Among his 10 predictions:
Spotify action slide
A revolution in the music industry could set in as more musicians adopt NFTs, or non-fungible tokens, to sell their songs, a move that could threaten streaming platforms like Spotify and Apple Music. , the bank said. The NFT market has exploded to a market capitalization of $ 15 million this year thanks to the rapid growth in sales of digital assets.
The bank sees an NFT-based music service backed by notable artists drop Spotify’s stock by 33% in 2022, as the challenger portends a “bleak” future for the streaming giant. Spotify in 2021 has already fallen by around 28%.
“[By] By leveraging NFTs, more specifically through “smart contract” blockchains, artists could distribute music directly to listeners without a centralized middleman, while tracking their income in real time, even getting paid in real time, listeners enjoying the knowledge that the money they pay goes straight to the artist, ”wrote Mads Eberhardt, cryptocurrency analyst at Saxo.
Labels and streaming platforms capture 75 to 95 percent of the revenue paid to stream music, Eberhardt said. Musicians have already started supporting crypto-based businesses. Singer Katy Perry, rapper Nas and electronic music duo The Chainsmokers this year helped raise $ 5 million for Audius, a blockchain-based music platform.
Inflation rate of 15%
The US consumer price index climbed to 6.2% in October, its highest rate since 1990. Saxo Bank predicts another rate hike next year, exceeding 15% for the first time since World War II, in large part because of the labor shortage in the American workforce.
Soaring inflation would prompt the Federal Reserve to tighten monetary policy “too little and too late”, leading to “extreme volatility” in the US stock and credit markets, said Christopher Dembik, chief executive officer. macro analysis at Saxo Bank. “JNK High Yield ETF drops to 20% and VIXM Medium Volatility ETF drops to 70%,” he wrote.
The coronavirus pandemic has “fueled a big wake-up call for workers,” Dembik added. “In all sectors and income classes, they are realizing that they are now more independent than ever. They demand a better experience: better working conditions, higher wages, more flexibility and a sense of work at work.
The “Women’s Reddit Army” forces stock fluctuations
Another scandalous prediction from Saxo Bank sees women on the social media platform Reddit using tactics employed by the so-called Reddit army on memes stocks to tackle gender inequality issues in businesses. These issues include women earning on average 20% less than men in the same jobs, leaving them with less disposable income to invest.
The “Women’s Reddit Army” would see women traders coordinate a long squeeze by short selling the shares of selected “patriarch companies”, said Althea Spinozzi, senior fixed income strategist at Saxo Bank. The group would also direct funds to companies with the best indicators of representation of women in middle management and among executives, she added.
“The movement is seeing real results as the broader market takes hold of the theme and joins in, forcing the prices of targeted companies to drop sharply, forcing companies to scramble to change their habits. marks the start of a renaissance of gender parity in markets, ”said Spinozzi. .