What our columnists got right and wrong in 2021

  • 12/31/2021
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TORONTO, Dec 31 (Reuters Breakingviews) - Every year, Breakingviews’ hive mind puts together predictions and prescriptions for the future. As the pandemic taught those engaged in fortune telling, it’s a mug’s game. But that never stops our intrepid columnists from going out on a limb and conjuring up thought-provoking and original ideas about what will, or should, happen in corporate finance, money and markets in the year ahead. As the planet grapples with a third year of the Covid-19 pandemic, it’s fair to say that we may have subscribed to glass-half-full thinking with the title of last year’s book, “The World Emerges". While there hasn’t been a complete bounce-back, there have been some signs of a return to normalcy. Here are some of our greatest hits and misses from the year just ending. One big hit: We predicted it would be a golden era for rainmakers. The value of global mergers and acquisitions increased by more than two-thirds, judging by the first 11 months of Refinitiv data. True, some of the corporate marriages we predicted didn’t actually happen: Walt Disney (DIS.N) held on to ESPN read more , and Netflix (NFLX.O) and Amazon.com didn’t scoop up any large theater chains read more . Deutsche Bank (DBKGn.DE) and Commerzbank (CBKG.DE) didn’t reunite (but they still probably will). And Tesla (TSLA.O) is still worth more than other carmakers, even without buying Daimler (DAIGn.DE). U.S. airlines didn’t consolidate read more , but never say never: The sector hasn’t fully recovered and debt has grown for European and American carriers. There’s plenty else that went our way. The relationship between U.S. President Joe Biden and Chinese President Xi Jinping remains frosty as ever read more . Anthony Tan, boss of Southeast Asia’s Grab , did indeed step into the limelight read more : The super-app went public after a $40 billion merger with a blank-check company. European soccer’s attempt to create a Super League, as well as cap salaries as a proportion of revenue, confirmed our prediction that professional clubs would adopt an NFL-like model – even if it ultimately ended up collapsing read more . We said there would be a boom in second-hand luxury goods read more , and that high-end fashion houses would seek to invest in the space. Kering (PRTP.PA) bought a 5% stake in resale platform Vestiaire Collective; Valentino and others followed suit with their own initiatives. Among the bigger picture predictions we foresaw a pickup in U.S. inflation in 2021 . Consumer prices rose 6.8% in November compared with a year earlier, the largest annual increase since 1982. Others were closer calls. We said Microsoft (MSFT.O) should buy messaging platform Discord . The companies held talks in March, according to Reuters, although Discord has gone it alone for now. We thought HSBC (HSBA.L) Chief Executive Noel Quinn could turbocharge his lucrative Asian business by selling the bank’s U.S. retail network and spinning off its UK unit read more . In May, HSBC did the former, but not the latter. BlackRock (BLK.N) brought shareholder democracy to some of its biggest clients, which account for a bit more than one-fifth of the fund’s $9 trillion assets under management allowing options to vote more directly at companies . And Beijing’s warning against the rapid data-center buildout, which runs contrary to its carbon-emissions goals, was in some ways a realization of our prediction about a growing consciousness around tech infrastructure, suggesting it could still become green activists’ next target read more . That will still probably come to fruition. The U.S. gambling opportunity read more , which we said was one of 2021’s better bets, came to light in high-profile deals like those involving Golden Nugget (GNOG.O) and Scientific Games (SGMS.O), and lured players like Las Vegas Sands to the table, even if others warned it could take years to build out. The omicron variant of Covid-19 might still be spreading rapidly as 2021 winds down, but vaccines are more widely available and cities are bouncing back read more . New York and London remained in the top spots in the Global Financial Centres Index in 2021. In what was perhaps our best stock pick: The tech behind the Moderna (MRNA.O) and BioNTech jabs, mRNA, drove up their combined market capitalization to $160 billion, compared with $120 billion in December last year read more . Surging sales made both companies profitable. In the year ahead, the big transitions driving economies and companies – decarbonization, digitalization, new ways of working, the end of the combustion engine and so on – will prove many of our prognostications correct...or not. Either way, we promise they will continue to provoke.

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