In 2022, with persistent inflation, central banks will be forced to withdraw stimulus by reducing or eliminating their Quantitative Easing programs or raising interest rates and this, together with geopolitical tensions, is going to cause us to see widespread falls in the stock markets. ” The three possible economic, monetary and investment scenarios in this 2022 This unit is emblematic of a world undergoing profound change, the FAANG 2.0. energy security is now the top priority of most governments a new FAANG list, more inclined to harsher realities like survival: military weapons to fight enemies, agriculture to feed a world short of food and gold, the main asset of refuge. The best funds to invest in fuel, defense, agriculture, nuclear, renewables, gold or minerals. The FAANG is best positioned for a new geopolitical era marked by runaway inflation, war between Russia and Ukraine, supply chain problems, and the energy transition. and other unpleasant things. The first, less likely, is continuous thanks to rapid price control; the second scenario, more feasible, includes persistent inflationary pressures, stimulus cuts, adjustment and a harsh correction in the markets, and the third would take place in a low-intensity war environment with stagflation, handcuffed central banks and crashes of up to 50% in bag. There are three scenarios (the good, the ugly and the bad) that seek to encompass in each case an accurate forecast of what may happen in the financial markets in the coming months and how an informed investor should deal with these changes. In any case, the analysis confirms a turning point in the markets, since the exercise will bring two consequences for many investors: the first, much more volatility in the financial markets than we have experienced throughout 2021 and in what 2022 goes and the second, a pinprick in the financial bubble created by central banks if they are forced to apply more restrictive monetary policy measures to combat inflation. Investment Recommendations: A – First scenario: good This macro scenario is dominated by monetary continuity, a return to macroeconomic stability, bull markets and minimal returns on debt. It is the one that most Central Banks consider that 2022 will mark. It is based on the fact that the current inflationary pressures would begin to subside as of this year and would return to the equilibrium point of around 2% in the medium term. The withdrawal of the monetary stimulus could be carried out in an orderly and unhurried manner. In this environment, it would be very likely that we would not see interest rate rises until 2023 at the earliest in Europe and only a small rate adjustment in the US. If the episode of inflation that we are experiencing is really temporary, it will mean that the withdrawal of the debt purchase programs can be carried out in an orderly manner, without generating shocks among investors and avoiding a collapse in the current sentiment of confidence. In addition, a downward inflation would give flexibility to the Central Banks to return to their monetary stimulus policies, in the event that the economies experience a worrying slowdown again. Investment Recommendations: – Preference for “growth” assets over “value”. – Preference for cyclical sectors over defensive ones. – Preference for the stock market in the US over the stock market in the rest of the world. – The so-called FANG (Facebook, Apple, Amazon, Microsoft and Google) would continue to lead the Nasdaq and the technology index would maintain a better performance compared to the rest of the stock market segments. FAANG is a new acronym, which includes a series of investment themes, in response to the changes that are taking place in the world, related to factors such as geopolitical risks or the increase in the consumption of certain resources: Fuels: Geopolitical tensions, strong demand and tight supplies are some of the things that influence prices. Aerospace / Defense: Geopolitical tensions could imply higher defense spending. Agriculture: the planet will need to produce more food in the next 4 decades than in the previous 8,000 years. There are important challenges, such as weather or demand from the growing middle class in emerging markets. Nuclear / renewable: theme linked to the commitment to commit to environmentally friendly energies. Gold (gold) / metals / minerals: gold is traditionally considered a refuge asset, while the use of certain minerals has intensified (eg, electric vehicles require six times more mineral compone
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