The Tell: A Bitcoin Crash, A Burst Housing Bubble — Giant Bank Sees 30 Risks To Markets For 2018

Wall Street has been cranking out 2018 outlooks as 2017 winds down, and plenty of them are super-wordy and conventional.

So when a reflection on the upcoming year fits on a single page, it deserves a little attention.

It’s Deutsche Bank that has circulated the list of 30 risks for markets in 2018 shown below.

“They are in random order and are both upside risks and downside risks,” writes the bank’s chief international economist, Torsten Slok.

“Think of them not only as potential VIX-boosters, but also as potential sources of faster or slower growth than what we have in our baseline forecast,” adds Slok, whose team has predicted real U.S. GDP growth of 2.3% in 2018.

In their list of 30 risks, Slok & Co. warn that a bitcoin BTCUSD, +0.48%  crash could hurt the confidence of individual investors. They are also worried about housing bubbles bursting in China, Canada, Australia, Sweden and Norway.

See: Bitcoin futures are now open — what you need to know

Investors also might not be ready for even a small correction in U.S. stocks SPX, -0.05%  , as they “haven’t seen one for a long time,” says the DB team, whose list was featured in our Need to Known column for Dec. 8.

Read more: These defensive stocks rate as one of Morgan Stanley’s key picks for 2018

And: What stock-market sector looks good in 2018? Think planes, trains and automobiles

On the upside, the positive impact from U.S. tax reform might somehow be bigger than expected, according to the giant bank’s economists.

So what now? The Reformed Broker’s Josh Brown has made the case that it takes “no talent” to make lists of what could go wrong and what could go right, and the real key is “managing portfolios that offer an answer to multitudes of potential outcomes.”

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