Slideshows

12 Days of Christmas: A Wealth Management Wish List for 2012

12 Days of Christmas: A Wealth Management Wish List for 2012 12 Days of Christmas: A Wealth Management Wish List for 2012
First Day: One grand compromise between Republicans and Democrats. First Day: One grand compromise between Republicans and Democrats.

Hopefully, a comprehensive deal can be reached that at least includes the extension of the payroll tax cut for 2012.

Second Day: Two additional doves on the Federal Reserve Board. Second Day: Two additional doves on the Federal Reserve Board.

A pair to join Chairman Bernanke, Yellen and Dudley to assure that any substantial softness in the economy would be met by aggressive non-traditional monetary policy (e.g. QE3).

Third Day: Wisdom comes to the “troika.” Third Day: Wisdom comes to the “troika.”

Here’s hoping the European Union, European Central Bank and IMF devise a comprehensive plan to resolve the European debt crisis and restore confidence in the longevity of the European Union.

Fourth Day: Four consecutive positive quarterly U.S. GDP reports. Fourth Day: Four consecutive positive quarterly U.S. GDP reports.

In order to maintain the growth momentum of the world's largest economy.

Fifth Day: Five golden rings. Fifth Day: Five golden rings.

Twelve would have been better given gold at $1,750/ounce, but we don't want to be greedy. It would also be "golden" if the Italian 10-year sovereign bond yield (currently 6.6%) traded below 5%, signaling the healing of the Eurozone crisis.

Sixth Day: China cutting interest rates to below 6%. Sixth Day: China cutting interest rates to below 6%.

Even though they’re currently at 6.56% as inflationary pressures fade to generate 7%+ economic growth in Asia ex-Japan. No "hard" landing in Asia would continue to buoy global growth and be supportive of risky assets.

Seventh Day: 7% price return of the S&P 500. Seventh Day: 7% price return of the S&P 500.

That is our current year-end target (1305) to our 2012 year-end target (~1375 to 1400). Plus 2% in dividend yield makes for total return of 9% – not too bad.

Eighth Day: An 8% unemployment rate by the end of 2012 ( down from 8.6% currently). Eighth Day: An 8% unemployment rate by the end of 2012 ( down from 8.6% currently).

May be wishful thinking given the structural issues with employment, but President Obama will need a dramatic improvement to maximize his chances of winning re-election.

Ninth Day: High-yield bond yields remaining below 9%. Ninth Day: High-yield bond yields remaining below 9%.

Which would be supportive of robust returns for this fixed-income sector – one of our favorites!

Tenth Day: All 10 S&P 500 sectors ending the year in positive territory. Tenth Day: All 10 S&P 500 sectors ending the year in positive territory.

Asset price inflation would be alive and well!

Eleventh Day: A strong jolt to the stock market. Eleventh Day: A strong jolt to the stock market.

With S&P 500 earnings growth set to decelerate to single digits, double-digit P/E expansion (e.g. 11%) will lift equities.

Twelfth Day: Another year of 12 consecutive months of positive monthly increases in retail sales. Twelfth Day: Another year of 12 consecutive months of positive monthly increases in retail sales.

Shop ‘til you drop America!

With the holidays fast approaching, Deutsche Bank Wealth Management has come up with a holiday wish list for its "true love,” the financial markets. For the most
part, the Deutsche Bank crew doesn’t believe they’re dreaming and predicts most of these wishes will come true 2012. Do you?


Here’s an interactive slideshow counting down the 12 wishes they and most wealth managers are hoping for in the New Year.

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