Some experts give financial predictions for the coming years. Rebecca Patterson, CIO Bessemer Trust, is one of them. She oversees more than 100 billion dollars for the richest families in the world. Investors have cogitate this after Paris situation a while ago. The situation will create refugee crisis so that starting effect on the market. Changing regulations make changes for consumer spending pattern.
This sentiment developing in the whole Europe Union and weakened Euro. According to Patterson, these moments are still classified as critical and increased the risk that the refugee crisis could result in a political and/ or policy shift, or simply lead consumers to change their spending patterns. It is become one of the greatest challenges for the Europe Union. Some countries will start to think about country borders compared to before. She also said that the condition of the European Union will strongly influence capital markets.
In line with Patterson, Morgan Stanley Investment Management Managing Director, Jim Caron said that inflation risk by 2015 would have profound effects on the capital market on 2016. People will going to wonder about the slowing rate of The Fed relating to what we think the climate change. “I believe inflation risk premia will return to the markets. This should provide upward lift for 30 years Treasury yields, possibly toward 3,75%. The markets may also be surprised by how slowly the Fed hikes rates in the face of what we think will be an improving economic climate,” he said.
The growth number of startup companies are too much in a short time, this also becoming one of the focus in 2016. Startups are greatly developed to reach a number which is not capable for financial sector to sustain. This is described by Greycroft Partners Co-Founder, Alan Patricof considering the value of all startups which reached more than one billion US Dollars.
Loomis Sayles Vice Chairman Dan Fuss is one that has long been follow the world stock developments said that 2016 is difficultly estimated. According to him, yields on the benchmark 10-year Treasury note will likely rise to 2,6% to 2,8% by the end of 2016 which is higher than the current. He expect the investors to stay in business in this times of crisis because investment will create new opportunities for the company with five to 12 years maturity and more careful company. High-yield debt has the best chance of success in 2016. the results of high, not too rely on index funding although slower movement of The fed. “It’s quite clear that high yield has the best value relative to stocks, but there’s a lot more scatter there.”
Russ Koesterich as Global Chief investment Strategic at largest money manager, BlackRock, said that the Fed would not largely affect on 2016. He predicts global growth will run slow and raising thirst to people in greater yield assets.
Tulio vera, chief global investment strategist at J.P. Morgan for Latin American Private Bank said, Argentina equity will get better and so affect all region in Latin America. Investors were encouraged to assess potential investments next year. “There’s a ray of sunshine from Argentina. That’s not only important for the country but also for the region. There will be some very interesting entry points in Latin American assets between now and the end of next year. We are getting closer to a re-entry moment for some of these markets,” said Tulio. In contrast with the investment climate in Brazil that is uncertain, Mexico still taking advantage of US economic recovery especially in auto industry.
While risk that may be appears post global economy shocks will still be occured 2016. Head of Emerging Markets Equity and Global Macro, Morgan Stanley Investment Management predicted that China will face various dynamics situation. “We are now just one big shock away from a global downturn, and the next one seems most likely to originate in China, where heavy debt, excessive investment, and population decline are combining to undermine growth, while relatively low-debt countries from Eastern Europe to South Asia look better positioned to weather the inevitable next turn in the cycle,” he added.
Different from Ruchir, one of China economist Yang Zhao said that China will in good climate and will focus on the services sector. Markets will still quite well-balanced although Gross Domestic Product (GDP) growth worth 5,8%.
This growth will create new job opportunities and financial industry will continue to hold up pretty strong because of the support of government. “Should any systematically important financial institutions have any problems, we believe that the government will step up to rescue them,” he said. Zhao is a Chief China Economist at Nomura Holdings, which cut its 2016 GDP forecast to 5,8% from 6,7%.
Positive tone also delivered by Thomas J. Lee, Managing Partner at Fundstrat Global Advisors said that equity would be far better in 2016 especially in banking and Blue-chip businesses. “Banks will benefit from the Fed tightening and will boost their returns on equity as the economy expands. And when you look at blue chips, they’re going to have the ability to generate stronger returns as the economy picks up,” clear the expert.
Most economic experts expect the us economy gets better than before, but in fact there is still a belief that the US will not financially as well as the previous year’s economic improvement.