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Wednesday, December 30, 2009

2009 Predictions, closing the year out

Back in January 2009, I was a tad bit cockier, as having a great two years in investing.
I posted 2009 market predictions and market trend predictions relating to finance and some politics.

In July, I posted Half Way to Hell, my commentary on the scorecard so far, and what remains.

How funny my 2009 opening lines read now, I quote:
I'm hoping I am becoming more accurate in my time line, and the person I am now would not have predicted complete collapse in 2007. I have learned the world moves slowly, but when the panic hits the heart of people, it moves quicker than anyone can imagine. In large numbers, fear is more powerful than greed.

The world moves slowly? And here I predicted it would move quickly in 2009. Ha!
I didn't listen to myself on how slow the world would move!
So lets cut to the chase. 2009 greatest hits and misses, see Italic BOLD for current commentary

2009 predictions met
  • Unemployment will hit 8% in 2009 in official figures, unofficial (REAL) numbers easily top 12%
    Real unemployment officially over 10%, unofficially easily at 15%
  • All countries will continue to race to devalue their currencies. The race to devalue will help ensure the US Dollar doesn't collapse as compared to it's peers.
    I count this as a win, the world is trying to race to devalue their own currencies, US dollar did devalue, but has been rallying back. USD did not collapse
  • Oil will hit 50 bucks a barrel in Q1 2009. Oil will hit over 60 a barrel before EOY 2009.
    Check, hit 49.47 in Q1, it hit about 67.56 bucks a barrel in Q2 (both hit higher in reality)
    Oil hit over 80 bucks a barrel in 2009
  • Oil for shorter term traders, on the pop up in Q1, will sell significantly out of this trade. Oil went straight down from 140 to 36, it needs a counter rally.
    Oil hit over 80 bucks a barrel in 2009
  • Gold, Oil, and resource plays are NOT guaranteed safe heavens, but over all investments, it will fair pretty well compared to the alternatives. See previous bullet as to why. GDX will hit 55 a share in 2009, wouldn't surprise me if this occurs in Q1.
    Check, GDX hit 55.40 in 2009
Near misses for 2009
  • Obama cannot save the USA and the world in 2009. (proven in short order
    Cant prove either way, so took it out of the met
  • With all this doom and gloom, predict the market WILL RALLY, sometime in Q1/Q2, and fool people into thinking the market has recovered before failing again. From 2009 market top to bottom will exceed 50%. (hence why I am long currently resource stocks/oil)
    Market did retrace 50% back up, as of December 2009, so we did retrace, but through Q4
  • DOW will hit below 6,000 (I'll take ANY bet on this one). And it wouldn't surprise me to hit DOW 4,000. (over 50% drop from current position)
    I thought below DOW 6,000, hit 6,469.95, off by 7.8%
  • Counties and states will face financial crisis, as many as 5 counties will outright fail in 2009, causing municipal bonds to sway.
    Many taking drastic action, .states like California have had major financial crisis, same with counties. But I haven't read of 5 counties failing.
  • Stock DECK (at 80 now) will trade at below 25 a share by Jan 2010 (may need extra month for earnings report)
    Near miss Went to 37.25, in 2009.
    And I suspect a complete miss for the price target by Jan 31 2010 of 25.
  • Gold valuation is unknown for Q1/2/3. Long term Gold is a great buy here again, and will be higher in the next 2 years. GDX is is currently at 33, and will hit over 55 in next Q1/Q2, target is close to 100 in 2009. This will be due to golds high price, but low energy costs and cheap labor (other miners such as copper laying off in droves).
    As previously mentioned hit 55 2009, 100 will be at end of 2010 possibly. So half right.
  • Inflation in Gold, Oil, or Food, will occur in 2009.
    I qualify this as a hit, as resources as measured in US dollars, did go higher
  • If gold collapses, will recover by Q4.
    Gold didn't collapse until extreme late Q4.
Misses for 2009
  • More insurance companies will have severe financial issues.
    There has been serious problems at various insurance companies surfacing, but as a whole, not severe.
  • The housing collapse is 50% there, as per my previous entry. The NorthEast will see acceleration as the financial market layoffs take effect in the region.
    Not achieved, and there is no recovery, but cracks are appearing
  • In Q2, the market will pull back, sucking the bears in for the short of a lifetime. They will be disappointed as the market rallies back in Q2/Q3 and hurts the bears.
    I WAS the sucker that I predicted! And the rally extended through Q4 DESTROYING bear traders
  • Deflation will "win" in wages, stocks, and real estate.
    Wages check, real estate - check, stocks - WRONG
2009 Debacles - Big Misses
  • The ETF SRS will hit over $200 a share in 2009, currently at $53. May hit $25 before $200. Over $500 a share would shock me.
    SRS hit below 25 a share, its at 8 bucks, hardly a miss, its a huge miss on 200 buck target.
  • The market will have a rally over Obama and his policies to save the world as the new savior. The rally (or trade sideways, lack of collapse) will last into Q2
  • After the rally of Q2/Q3, the market will finally collapse to new lows in Q3/Q4.
    Obama Rally lasted straight into the end of 2009
Over all, I have to say my predictions werent a complete debacle, but there is enough wrong to not count it as a banner year for meeting expectations. For 2010 predictions, I'll try to be more pointed in predictions, and keep it to a few. Often palm readers and other prediction nuts use the technique of predicting 1,000 things and highlight the right to paint themselves as good visionaries.

I had too many diverse thoughts, muddying the assessment.

1 comment:

  1. Overall still a great scorecard Murf. Some of your readers know that we usually work together, and I'll still take our three year track record over just about anyone! :)

    For 2010, I still would rather be short the markets as opposed to long, yet lots of sideways action and choppiness wouldn't surprise me either. There are just so many pending problems with the banks and commercial real estate sector. This makes me feel that another large downturn is on the eventual horizon.

    Good luck to everyone,