For the full Macro Hive World Cup Playbook, click here!
To give a taste of how each team (and their country) will fare, we’ve asked our network for their views. We’ve asked people the following questions:
- Which player is most under-rated in your national side?
- Which player in your national side will score the most goals?
- How far will your team go in the World Cup?
- Which team do you think will win the World Cup?
- Will your central bank beat inflation in 2023?
- Will your home country currency outperform the dollar in 2023?
- What’s the best investment in your home country?
- What’s the biggest macro risk in your home country?
So not only will you get some insights on the quality of each team, but you’ll also get some investment insights for 2023. A win-win situation.
Importantly, we don’t just focus on the big footballing nations. In fact, we have a special focus on Canada – the often-overlooked nation. We’d rather hear from them than the Americans, who don’t have the right name for the beautiful game of football. Meanwhile, Sam also clues us up on the Netherlands – or Oranje as he prefers.
Special Focus 1: Canada
Canada’s appearance in the 2022 World Cup will only be the second time that the country has participated in football’s foremost international tournament. The last time they qualified, in 1986 in Mexico, Canada only played in three games, lost each time, and scored a grand total of zero goals.
This time around, hopes will be higher, but it must be noted that Canada is in a tough group. Belgium, the second-best team in the FIFA rankings, is an obvious standout in Group F, with the 2018 World Cup finalists (and number 12 ranked) Croatia also in the group. Morocco, number 22 in the world, will also be a formidable opponent for the 41st ranked Canadians.
Most Underrated Player
Turning to individual players, the star for Canada is Alphonso Davies, the 21-year-old fullback/wingback who plays for perennial German Bundesliga champions Bayern Munich. There was some fear that Davies might miss the World Cup due to injury, but it seems he will be fit for the tournament. And while Davies is the most recognisable player on Canada’s roster, it could also be argued that he is the most under-rated. This is especially true in a bigger picture view of the game in Canada, and how important the emergence of Davies on the global stage in a big European league has been to the growth of football in his home country.
A good World Cup from Davies and his team could catalyse an increase in popularity of the sport in Canada. The importance of Davies, therefore, cannot be overestimated in this broader context.
Biggest Goal Threat
Assuming Canada can better its 1986 goal output and actually score in Qatar, Jonathan David will probably be the danger man and leading scorer. Like his international teammate Davies, David also plays his football in one of the big five European leagues, for LOSC Lille in Ligue 1 in France. David, only 22, is very highly rated and continues to be linked with a potential big money move to a big club in the English Premier League. He has been a prolific goal scorer at club level, so he will be considered the major goal threat for Canada.
How Will Canada Do?
I find it very difficult to see Canada getting out of Group F. There are three very tough teams bundled with Canada here and, despite my heart telling me that ‘anything can happen’ in a tournament, my head tells me that this will be a big ask.
It would be great to see Canada be competitive, push the big clubs in their group, and generally improve the status of the game back home. That would be progress from last time and will hopefully mean this is the first in a string of World Cup qualifications (beyond 2026, where Canada automatically qualifies as a co-host).
Which Team Will Win the World Cup?
Europe has won the previous four World Cups, and six of the past eight. And while eight of the top ten teams in the FIFA rankings are from Europe, it really feels like it might be South America’s turn to win this time around.
Brazil, the world’s number one ranked team, looks very strong going into the tournament, especially up front, with so many excellent attackers. They also certainly seem to be the favourite in the betting markets.
Argentina, however, will be the choice of many. They are third in the FIFA rankings, so are a strong challenger on this metric. A sentimental element for Argentina may also be quite a compelling driver for the country’s success. At 35, this will almost surely be Lionel Messi’s final international tournament. Arguably the best player of his generation, Messi has won virtually every trophy imaginable, except for the World Cup. This might be the ‘X Factor’ for Argentina. In the final analysis, however, it is hard to look past Brazil for the eventual winner.
Will The Bank of Canada Beat Inflation in 2023?
The Bank of Canada will probably keep inflation in check in 2023.
In its most recent Monetary Policy Report (MPR), the Bank stated that even though inflation remains too high, it has declined from its peak (although underlying price pressures remain elevated.)
Having said that, financial conditions have become more restrictive, firms’ investment and hiring plans are softening, activity in the housing market is moderating due to higher mortgage rates, and household spending is slowing. While uncertainty is high, particularly due to geopolitics and the volatility in energy markets, the Bank forecasts inflation to fall in 2023, eventually hitting 2% in 2024.
Will the Canadian Dollar Outperform the US Dollar in 2023?
It is hard to see the Canadian dollar outperforming the US dollar next year. In the event of a global economic slowdown (and possible recession) in 2023, this macro backdrop will probably see the USD outperform the CAD. Although the US will not be immune to a global slowdown/recession and will also experience material economic challenges, the US economy seems to be going into next year in a stronger position on a relative basis. This should lead to USD outperformance against CAD. This will be especially true if haven flows are seen into the Greenback, which cannot be ruled out given geopolitical and economic uncertainty.
What’s The Biggest Macro Risk in Canada?
The biggest macro risk in Canada is the same as in other developed market countries — the challenge of central banks tightening policy into (what now looks like) an inevitable economic slowdown/recession. While the Bank of Canada and its counterparts have clearly been laser-focussed on fighting inflation, there is a big risk of tightening too much into a potentially deep global economic slowdown in 2023. This could lead to a volatile macro backdrop next year, impacting financial markets and the real economy.
Special Focus 2: Netherlands (AKA, Holland or Oranje)
Sam van de Schootbrugge
The Dutch have a love-hate relationship with major footballing competitions. The Orange Army, steeped in passion and pizazz, are all too aware that the Netherlands have never won a World Cup. Yet, you will find no other nation with more runners-up medals, more Ballon d’Or victories, or a more impressive youth set-up. It is perhaps the greatest misjustice in football that the pioneers of Total Football, the blueprint for Pep Guardiola’s Tiki-taka system, have only ever once tasted international victory – Euro ’88. Can this year be our year?!
Which Player Is Most Underrated in Your National Side?
Louis van Gaal enjoys a solid defensive, possession-based football style. He has three world-class ball playing centre backs in Jurrien Timber, van Dijk and De Ligt, flanked by experienced technicians in Daley Blind and Denzel Dumfries. If that’s not enough, they’ll be reinforced by two holding midfielders, with one of those likely to be Frankie De Jong. If we’re looking for an underrated player, it’ll be a footballer in one of these seven positions.
For me, I’m looking at Jurrien Timber to make a difference on the international stage. Just 21, he’s already turning into one of the best central defenders in Europe. He’s consistent, creative and carries a goal threat. I see him linking the defensive play with the counter-attack, helping the Dutch pinch a goal or two against higher-ranked oppositions. Off the pitch, though, I think van Gaal is the most under-rated manager and any success at the World Cup hinges on his tactical nous.
Which Player in Your National Side Will Score the Most Goals?
With just three attacking positions in the team, there isn’t much choice. I wouldn’t bet against Liverpool’s Virgil van Dijk or Bayern’s Matthijs de Ligt coming in top. But, I will go with Barcelona’s Memphis Depay – top goal scorer in the recent Nations League competition. He’s struggled at club level, but he always saves his best for his country.
How Far Will Your Team Go in the World Cup?
Holland should progress out of the group stages. Group A is statistically the weakest in the tournament, providing an easy start for Van Gaal’s team on paper.
In the Round of 16, they face the qualifiers from England’s group. If they face the US or Wales, a combined head-to-head record of 14-1 in favour of the Netherlands, opens the door nicely to the Quarters. If the Netherlands face England, history favours the Three Lions, but momentum swings the other way.
Next, the Dutch could meet Argentina or Denmark. Argentina knocked the Netherlands out in the semi’s in 2014, and Argentina are second favourites to win the World Cup. However, the head-to-head favours Holland for both these ties.
Too many variables thereafter make forecasts pointless in my opinion. Then again, I predict the Dutch won’t get past the Quarter Finals. But, if they do, they could get favourites Brazil or a very talented Spanish side in the semis. It pains me to say, this year is unlikely to be Holland’s year.
Which Team Do You Think Will Win the World Cup?
I think the Dutch are very pragmatic. We’ll admit that we’re unlikely to win the World Cup, unlike some nations…which brings me to England. I think they’ll do well, but I can’t see past France. They have a great mix of experience, exuberance and pace, most of their players are in title-challenging league clubs, and they won it last time out. Sadly, this could mean knocking England out in the Round of 16.
Will Your Central Bank Beat Inflation in 2023?
The Dutch are right up there with Italy, Germany, Hungary and Austria in terms of the estimated GDP losses from the energy crisis. The Netherlands also currently has one of the highest inflation rates in Europe, and the highest on record for the country. Moreover, core CPI is still accelerating upwards, and wages are growing at close to their fastest pace this century.
With limited say in monetary policy, the above-average price rises in the Netherlands have spurred a stronger-than-average fiscal response to support household consumption. This is uncharacteristic of a country better known for its frugal approach to spending. While the fiscal spend may ease pressures this year, it’ll make beating inflation in 2023 that much harder.
Will Your Home Country Currency Outperform the Dollar in 2023?
I think the Dutch are happy to ride along with wherever the euro goes in 2023 – it’d certainly outperform the old Dutch guilder! Nevertheless, the left-tail growth risks in Europe for 2023 strike me as (i) more likely, and (ii) more under-estimated relative to the US. I’ll follow Bilal on this one – short EUR/USD.
What’s the Best Investment in Your Home Country?
Cheese! Nothing can be surer than the strong demand for Gouda in times in economic turmoil. Even with average food prices up over 10% YoY, Gouda has risen a gentle 1%. It is a staple food at home, and abroad. The appetite for cheese globally is on the rise (Statista), and Dutch exports of Cheese and Curds are at historic highs (approx. EUR438m or 0.7% of total exports in Aug 2022).
Merging cows with tech, why not check out Royal DSM? It’s new Bovaer feed minimises methane emissions from cows – greener cheese, and not the mouldy kind! The company’s price has dropped 38% off its highs – double the Euronext average. Does that smell like a good investment? I’ll leave you to decide…
What’s the Biggest Macro Risk in Your Home Country?
Small in size, the Netherlands is very dependent on the Eurozone’s economic cycle. I fear, with the country relatively more susceptible to developments in Ukraine, the left-tail growth risks are even greater for the Dutch if the ECB struggles to reduce inflation.
While the government and household balance sheets are generally well positioned for a downturn, private debt is particularly high in the Netherlands. Higher interest rates and lower consumer demand could lead to significantly higher corporate default rates relative to the rest of Europe.