Will volatility return to the markets in 2015?
World Finance asks Saxo Bank's Chief Economist, Steen Jakobsen, whether volatility is likely to return to the markets in 2015
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Transcript
World Finance: To what extent do you think volatility will return to the markets in 2015?
Steen Jakobsen: I don’t normally issue any guarantees, but I will guarantee you in 2015, volatility will increase. The geopolitical risk, I don’t need to go through the list of those, but if you look at the credit spreads they are trading in spread terms below the default rate, we have a zero interest rate policy around the world, even high-yielding economies like Australia are heading towards zero percent. We have China with no growth, we Europe with no growth, we have disinflation, we have a violation of every single inflation target in the world. If that doesn’t create volatility I will resign and go back to school and become a professor in agriculture.