2018 is going to be very interesting

We’ve started receiving outlooks for 2018 and there seem to be some dispersion in brokers’ expectations.

Overall 2017 has been a pretty good year so far. The « growth without inflation » theme has played out at full steam and up till now, nothing seems to stop it. 2018 might be different story if a number of surprises/unmet expectations fill in:
– a burst of inflation (not expected by anyone, even central banks) that would lead to a…
– … sharp rise in interest rates (also not expected; everything will be smooth and easy according to many commentators);
– a sharp slowdown in earnings growth;
– a crash in some parts of the market (high yield anyone ?) and the disappearance of liquidity;
– a recession (probas are low now but since most of the performance has been backed by improving leading indicators but not « real » data – wages, industrial production…)