Results 1 to 14 of 14

Thread: 10 predictions for 2008

  1. #1
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default 10 predictions for 2008

    ... which seem pretty obvious to me !



    (snip)"
    1. The price of gold will touch 4 digit in USD ($1000) for the 1st time in human history. Gold has entered the 2nd phase of its uptrend, will have more explosive up movement and become more volatile. We should see $50+/- intraday movement in 2008. But this gold bull market has a long way to go beyond 2008.

    2. With gold rising, silver and mining stocks represented by HUI will eventually catch up. I expect to see HUI over $600 and sliver over $20 in 2008. Don't give up on them. A turnaround always happens at the time when everyone feels desperate and gives up.

    3. After a temporary rebound, USD will continue its downtrend again, as an inverse mirror image of gold. USD will lose another 10% of its value and USD index will touch 70 sometime during 2008.

    4. In 2007, we see the burst of mortgage bubble followed by the burst of real estate bubble. We will see the burst of credit card bubble in 2008 (another blow to the credit market), while some consumers have financed their credit card purchases to the hilt and many years into the future. The burst of this long time consumer bubble will dampen any recovery hope of the retail sector and the economy. At the end of the day, the credit card industry is similar to subprime, with new cards of initial tease rate of 0% to people who should not even have a card, then jack the rates to as high as 36%, making subprime rate look paltry.

    5. Citigroup will drop to teens (below $20). More bad news to come in the banking industry. Only less than half of the subprime write-downs have announced in 2007, with another half yet to come. OTC derivative market is full of land miners, like steroids in professional baseball, even we don't know the exact implication and situation of each player (bank), we know many of them having problems and will hear more explosive news in 2008. Banks will be stacked with lawsuits, from self-promoting fund returns with the whole purpose of collecting fees and bonuses, to unable to show ownership documents to foreclose homes and face countersuits from disgruntled homeowners. The current moving SIVs to balance sheet will further invite shareholder lawsuits, with the argument that SIV instruments should never have been off their balance sheets to begin with thus false and misleading shareholders, and now putting them back at par further destroying shareholder's equity. The fact that banks are busy bringing in sovereign funds tells us there are much more skeletons in the closet. If this now is the end, banks are able to absorb all the write-downs and would not have asked for sovereign fund injections. The mindset behind sovereign funds investing in US is no different than previously holding all US treasuries in their funds, only this time they "diversify" into more risky US equities. Not only this is too early for bottom picking, likely to suffer 25% loss like their Blackstone investment, but also any future return (if any) will be more than offset by the further falling USD.

    6. Inflation will grow high, and agriculture commodities of soybeans, corn and especially wheat continue to rise to new highs. Wheat is a commonly used ingredient for many daily products which actually provides a better gauge of food inflation than any other indicators. Public will start questioning government published CPI number when food, energy bills are growing intolerable high. There will be pressure for government going back to the pre-adjustment CPI methodology used in the 70s and 80s which is 3-4% higher than current published data, so that their TIPs investment could receive more equitable income. There will be talks and fear about real double digit inflation down the road.

    7. Energy price will continue to rise. We should finally see oil at 3 digit ($100 and more) and a decent recovery of the natural gas market with inventory level declining. Against popular opinion, higher oil price would neither reduce global demand, nor increase global supply. Alternative energy is more a dream than reality. Oil from tar sands is not only costly, but also faces environment challenges. Biofuel not only drives corn price to sky high, but also reinforces public perception that biofuel takes poor people's basic need for food (corn) away to pay for rich people's gas-guzzling SUVs.

    8. S&P market will be at trading range and volatile. Both banking and retail sectors will continue to be under pressure, as discussed earlier. The $1,576 price S&P 500 reached in October 2007 is likely the highest for this ending bull market, we should see more severe correction in 2008. Corporate earnings and profit margins will shrink along with stock prices to make P/E at about the same level as now, a typical valuation trap at the start of a bear market.

    9. Fed will try to rescue market from time to time after big crashes by further lowering fed fund rates, likely 3.5% by yearend. As inflation fear grows, long bonds will drop and yield will go higher. 30-year yield will be back above 5%, with short end (Fed rate) at 3.5%, yield curve will become much steeper than now.

    10. National real estate market will decline faster in 2008 than 2007, recording double digit loss and we won't see the bottom at least until 2009."(snip)

  2. #2
    Banned Katrine's Avatar
    Joined
    Nov 2003
    Posts
    13,855
    Thanks
    0
    Thanked 0 Times in 0 Posts

    Default Re: 10 predictions for 2008

    11. Aliens will invade planet earth and make us their slaves. And they will steal all the gold!

    "Have you ever been to American wedding? Where is the vodka, where's marinated herring?" - GB
    "And do the cats give a shit? No, they do not. Why? Because they're cats."-from The Onion

    Quote Originally Posted by Mia M
    If a cupcake was tossed at me... well, I'd only be upset if it missed my mouth

  3. #3
    God/dess Deogol's Avatar
    Joined
    Dec 2003
    Posts
    5,493
    Thanks
    120
    Thanked 50 Times in 35 Posts

    Default Re: 10 predictions for 2008

    Those Bastards!

    (Besides, that is actually in 2012!)

  4. #4
    Member texasdancer's Avatar
    Joined
    Sep 2006
    Location
    Ironic, Florida
    Posts
    45
    Thanks
    1
    Thanked 0 Times in 0 Posts

    Default Re: 10 predictions for 2008

    On number one, a technical point, factoring inflation, gold has been over $1000. If you believe everything is going to fall apart, gold is still cheap on a historical basis.

  5. #5
    God/dess Bella21's Avatar
    Joined
    Sep 2003
    Location
    SoCal
    Posts
    7,772
    Thanks
    2
    Thanked 40 Times in 35 Posts

    Default Re: 10 predictions for 2008

    ... and now Bella is sad...
    If you think school is hard, try being stupid.

  6. #6
    Banned Katrine's Avatar
    Joined
    Nov 2003
    Posts
    13,855
    Thanks
    0
    Thanked 0 Times in 0 Posts

    Default Re: 10 predictions for 2008

    Quote Originally Posted by texasdancer View Post
    On number one, a technical point, factoring inflation, gold has been over $1000. If you believe everything is going to fall apart, gold is still cheap on a historical basis.
    Very true.

    "Have you ever been to American wedding? Where is the vodka, where's marinated herring?" - GB
    "And do the cats give a shit? No, they do not. Why? Because they're cats."-from The Onion

    Quote Originally Posted by Mia M
    If a cupcake was tossed at me... well, I'd only be upset if it missed my mouth

  7. #7
    God/dess britneyireland's Avatar
    Joined
    Jan 2002
    Location
    Dallas
    Posts
    2,568
    Thanks
    283
    Thanked 602 Times in 340 Posts
    Blog Entries
    1
    My Mood
    Inspired

    Default Re: 10 predictions for 2008

    It a good time to be a Bear!
    Rebecca Avalon







  8. #8
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: 10 predictions for 2008

    ^^^ actually, it's never a 'good' time to be a bear, because bear markets mean pain for someone. However, if a bear market is inevitable, it's much better to minimize potential pain to your own investments ... and there's no reason to feel guilty about making a buck on 'bear' investments either !

  9. #9
    Veteran Member
    Joined
    Oct 2006
    Location
    lap dance land
    Posts
    711
    Thanks
    313
    Thanked 292 Times in 132 Posts

    Default Re: 10 predictions for 2008

    This is very discouraging

  10. #10
    Member miss_rosewoods's Avatar
    Joined
    Feb 2005
    Location
    Los Angeles
    Posts
    21
    Thanks
    0
    Thanked 0 Times in 0 Posts

    Default Re: 10 predictions for 2008

    Quote Originally Posted by Katrine View Post
    11. Aliens will invade planet earth and make us their slaves. And they will steal all the gold!
    this made me totally smile.. thank you!

  11. #11
    Featured Member Wwanderer's Avatar
    Joined
    May 2004
    Location
    Most of the time in N. America, Asia, Europe or Australia
    Posts
    1,337
    Thanks
    0
    Thanked 4 Times in 4 Posts

    Default Re: 10 predictions for 2008

    Quote Originally Posted by Melonie View Post
    ... which seem pretty obvious to me !

    http://www.safehaven.com/article-9112.htm

    (snip)"
    1. The price of gold will touch ... "(snip)
    As usual, I think that it might be a good idea to look at past performance of those who claim to be economic prophets before getting too worked up over their current predictions, and in this case it is easy to do. Last year Mel posted a link to this same source's predictions for 2007, namely:

    http://www.safehaven.com/article-6590.htm

    (See http://www.stripperweb.com/forum/showthread.php?t=79811 for the thread.)

    In case you don't want to bother looking it up, here's a summary:

    Re the S&P500, "safehaven" said "There is a significant resistance zone between 1439 and 1478 that I believe will cap any upside move for 2007." The article then went on to predict a low for the year in the 1150-1230 range. But in reality, the index exceeded 1550 at its high and only got down to about 1375; today it is at about 1450.

    For the Dow, "safehaven" predicted a 2007 high around 12,900 and a low in the 10,600-11,250 range. But the reality was a high of over 14,000 and a low just above 12,000.

    For the NASDAQ, "safehaven" did somewhat, but not much, better. It said that trading at 2900 was possible but would be a real "bullish surprise" and predicted lows around 2067-2150. As it turned out, the high was about 2860, and the low 2330.

    In overall summary, "safehaven's" predictions for 2007 turned out to be in the range of wildly to seriously too bearish, and on that basis, my guess is that the same will turn out to be true of their 2008 predictions. Put even more bluntly, taking their advice is more likely to keep you "safe from profits" than from losses, based on past performance.

    Slightly more seriously, being badly wrong about one year (2007) does not mean that they ("safehaven") will be badly wrong about all years (including 2008 ), but it should serve as word of caution against taking their perspective as the gospel. Moreover, if you scan through the site a bit (or even just consider its name), it is clear that it has a rather bear-ish view overall and is likely to err on the bear side more often than not.

    -Ww
    "At this moment what more need we seek?
    As the Truth eternally reveals itself,
    This very place is the Lotus Land of Purity,
    This very body is the Body of the Buddha."
    - Zazen Wasan

  12. #12
    Banned Katrine's Avatar
    Joined
    Nov 2003
    Posts
    13,855
    Thanks
    0
    Thanked 0 Times in 0 Posts

    Default Re: 10 predictions for 2008

    Safehaven is all about the gold. Someone is paying them well to keep shilling gold. All articles are going to be accordingly biased. At least that's what I get from them.

    But I do predict that this is going to be a rocky year. However, it should not be an indicator to pull out of long-term investments.

    The investor who missed the top 10 days of the markets in the last decade, lost 50% of their average return. This is assuming SPY index as "market".

    "Have you ever been to American wedding? Where is the vodka, where's marinated herring?" - GB
    "And do the cats give a shit? No, they do not. Why? Because they're cats."-from The Onion

    Quote Originally Posted by Mia M
    If a cupcake was tossed at me... well, I'd only be upset if it missed my mouth

  13. #13
    Featured Member Wwanderer's Avatar
    Joined
    May 2004
    Location
    Most of the time in N. America, Asia, Europe or Australia
    Posts
    1,337
    Thanks
    0
    Thanked 4 Times in 4 Posts

    Default Re: 10 predictions for 2008

    Quote Originally Posted by Katrine View Post
    Safehaven is all about the gold. Someone is paying them well to keep shilling gold.
    People who own a lot of gold have a vested interest in encouraging other people to buy gold too. And of course, you can pretty well substitute any marketable commodity for "gold" in the previous sentence. A yet more general take is that "free" financial advice often aims to get your money in some other way, especially if it is free advice that someone goes to the trouble of distributing/promoting on the web or in other ways.

    -Ww
    "At this moment what more need we seek?
    As the Truth eternally reveals itself,
    This very place is the Lotus Land of Purity,
    This very body is the Body of the Buddha."
    - Zazen Wasan

  14. #14
    Veteran Member StuartL's Avatar
    Joined
    Feb 2006
    Location
    European Man Of Mystery
    Posts
    648
    Thanks
    1
    Thanked 21 Times in 7 Posts

    Default Re: 10 predictions for 2008

    Kenya, Pakistan and Nigeria...

    Looks as though we won't even be through January and a few of these predictions might have been met. Gold and oil being the likely ones. And what have we been discussing about inflation for months and months and months? It won't be long and the rest of the world will spot that little sleight of hand.

    Good luck in 2008 everyone - we may need it!!

Similar Threads

  1. Oscar predictions
    By Madcap in forum The Lounge
    Replies: 11
    Last Post: 02-24-2008, 10:35 PM
  2. Predictions for next year
    By Elusive21 in forum The Lounge
    Replies: 4
    Last Post: 01-13-2008, 10:32 AM
  3. Replies: 2
    Last Post: 01-13-2008, 09:17 AM
  4. Replies: 2
    Last Post: 01-04-2008, 01:12 PM
  5. Oscar Predictions
    By supermaruchi in forum The Lounge
    Replies: 4
    Last Post: 10-29-2006, 07:58 AM

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •