Paul the Octopus
Regular readers may remember Paul the Octopus, the football oracle who amazed everyone with his spot-on predictions? The Fixed Income team have often used our Net Foreign Asset (NFA) model to help predict the outcomes of major football and rugby events, and we’ve had some spectacular results on occasions; most notably when Japan beat Spain 2-1 in the Qatar World Cup.
We've noticed an interesting trend: during tough economic times, wealthy nations tend to perform better in these tournaments. But when things are more prosperous, it's the heavily indebted countries like Spain and Portugal that shine. Remember Greece's unexpected Euro 2004 win when global growth topped 5%?
Times are much tougher now, so for this tournament, we're putting our money on the wealthy nations. We predict Germany (6 stars!) will triumph over Scotland (3 stars) on Friday, and on Sunday we foresee England (3 stars) beating Serbia (2 stars). We'll keep you updated on the rest of the matches.
We're aiming high, but we know we probably won’t outdo Paul the Octopus. His incredible accuracy (85.7%!) was truly remarkable. His keepers at the Sea Life Centre in Germany presented him with two boxes, each representing a team, and his food choice determined his prediction. Sadly, Paul is no longer with us, having passed away and the tender age of two years old. However, if Paul were with us, he would have plumped for Germany given he backed Germany 11 times out of 14 matches!
If you are in your company’s Euros sweepstake, hopefully you picked a wealthy nation. But if you have picked the likes of Serbia, one of the most indebted nations and a long shot at 146-1, hope may be given in recalling Paul the Octopus’ change of allegiance back in 2010, when he correctly predicted that Serbia would beat Germany. So, one never knows, good luck!
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