Boris Johnson is clearing the decks for a massive public spending binge to revitalise the economy. The cornerstone is a rail project that is running over budget and might involve the Chinese. Markets are wondering who will pick up the tab.

Germany must ditch its fiscal conservatism and put its budget surplus to work. An ultra-loose monetary policy in conjunction with over-tight fiscal policy is hampering growth and distorting the euro zone yield curve.

More policy accommodation in the form of easier credit and fiscal stimulus from Beijing looks likely. The Federal Reserve must go the extra mile and consider another interest rate cut.

Central banks seem committed to loose monetary policy, which means the wall of money they created since the 2008 financial crisis needs to find a home. Negative yields in mainstream bond markets will push investors towards equities.

The euro could be a major winner in the currency markets this year, as world trade and the German economy get back on track. If the euro rallies against the dollar, there are important implications for China’s currency reserve management.

The years of deflation or low inflation may end as a growth recovery gathers momentum and puts less pressure on prices. Central banks, which are largely sticking to loose monetary policy, should go with the flow.

The positive impact of a trade deal with China will outweigh the downside risks of a potential conflict in the Gulf, leaving domestic politics to play a key role in whether market confidence in the US dollar will hold.

As the trade war recedes, investors will feel better about market prospects. With bond markets offering rock-bottom returns, the pressure to switch into stocks will be compelling, giving the equity market a bigger boost.

Despite the potential spoilers, 2019 has been a good year, with the MSCI world index gaining some 30 per cent. The world is in transition and even the impeachment process against Donald Trump could turn to investors’ advantage in 2020.

While China’s planners will no doubt institute more structural reforms and improve supply-side investments, they should boost expectations by aiming for a 6 to 7 per cent growth target.

Supportive ECB policies and green-shoot growth in several European economies, as Germany successfully avoided a recession, are good news for the market. But the US threat of tariffs on French goods could portend an escalation of tensions.

Market crash fears are out of date. Recent business confidence numbers from the US, China and Germany show the global economy is not down and out. The world’s governments must seize the momentum and find new ways to fund sustainable recovery.

With US economic data suddenly looking brighter and positive noises being made in the trade war, risk reversals could be round the corner. After years as sanctuaries for investors, government bonds may finally lose their mojo in 2020.

Europe’s common market is supposed be a level playing field. But as Germany remains a magnet for foreign capital – most recently Tesla’s – the gulf between Europe’s rich and poor will only widen, fuelling the EU’s existential crisis.

Markets, having priced in the worst outcomes of the trade war, a Trump impeachment and Brexit, now seek good news. As central banks ease policy, political risks recede and with a trade deal in sight, 2020 should be glorious.

The US central bank is cutting interest rates and buying short-term Treasury bills with the aim of supporting the economy. This should give China more room to ease policy and stabilise the yuan, taking some heat out of the trade war.

China’s economy could return to 7 per cent annually, the US could near 4 and the global economy could go back to 5. But this would depend not just on the trade war ending, but appropriate stimulus and reform measures afterwards.

Deficit spending among major economies steadily declined in the years after the global financial crisis ended. With economies around the world slowing, major players – Germany in particular – should abandon austerity now.

The Fed should not only cut interest rates, but up its quantitative easing holdings, thus driving down the dollar. This, and a trade war ceasefire, would not only boost the US economy but the global economy and trade as a whole.

There’s no better way for Trump to fight off the threat to his presidency and increase the chances of his re-election by focusing on improving the US economy and global outlook. The damaging trade war must end.

Europe’s emphasis on austerity and fiscal stabilisation since the global financial crisis is not working. With a recession and no-deal Brexit looming, it’s time for the ECB and European governments to loosen the strings.

The US-China trade war, Brexit and tensions in the Gulf could add up to a perfect storm for the global economy. The world can’t count on Trump. Now, more than ever, Beijing must take the lead.

Since Donald Trump launched his trade war US trade and budget deficits have only grown, and now the US economy is slowing. Better to tame runaway US consumerism and start policy coordination with other major powers to stave off a recession.

China should set a new range for its currency and use the rest of its reflationary tools to reach its 2019 growth target. It should also lead the way in seeking reconciliation at a time when the trade war is hurting everyone.

Germany’s economy is flashing warning signs and with a no-deal Brexit imminent, contagion might spread across Europe and the world. The Chinese economy, already under stress from the US trade war, is vulnerable.

Governments everywhere it seems are turning to stimulus to stave off the very real risk of global recession. This return to Keynesian-centred solutions must avoid boosting inequality again, though; governments should agree on a global ‘New Deal’.

China’s policy options amid a slowing economy are to strike a face-saving trade deal with the US, devalue its currency and offer cheap loans at home. Beijing must use them all.

The US’ overreliance on expansionary fiscal policy when the country is already deeply in debt is a recipe for disaster. Beijing, for its part, needs reforms to spur domestic demand, not currency depreciation that could further provoke the US.

Neither austerity nor supply-side economics that put the haves before the have-nots will pull Europe out of its doldrums. To rescue the economy, Brussels must help its poorer members and spend on key infrastructure and social services.

Britain is an important enough trading partner for the EU to work out a late deal, much as it once did with Greece. Furthermore, Britain looks like it’s taking the gloves off and getting ready to spend big.