2012

[Iron]

My predictions at the end of last year were partially correct. The B of E didn't budge on interest rates, but Greece and Ireland are facing further austerity measures, and some bondholders of Greek debt will have to take a haircut.

I'm going make a bold prediction for 2012.

I think the West, economically speaking, is like a ship on a collision course with a huge iceberg. If we're lucky, we'll be able to minimise the impact, but we won't be able to avoid it.

Let's say that a banking failure means that people can't withdraw money from their bank accounts. If people have no means to pay their bills, and the army and police force are also without money, then what happens next is anyone's guess...

So my prediction for 2012 is the establishment of a new global economic order, following social unrest on a scale unprecedented in human history. As we saw with Communism in Eastern Europe, economic and political systems can unravel quickly once a tipping point is reached. However, what form the new order would take is anyone's guess...

And to think some people accuse me of excessive positive thinking!

Jeff

Here are my predictions for 2011:

A. QE-fuelled inflation will force the B of E to raise interest rates. The resulting impact on spending by the public will wipe out the private sector recovery on which the austerity plan was based. In turn, this will force further government spending cutbacks. The only thing keeping the Coalition together will be the Lib Dems' knowledge that they'd be wiped out in a General Election!

B. Greece and/or Ireland will suffer a further economic slowdown, and be unable to meet their debt repayments without further austerity measures. Bondholders will probably take a haircut, losing many billions of euros, causing another global market crash. Only this time, the only money that will be available to rescue the banks will be freshly printed (ie non-existent) money...

[Euler]

I predict the future will be unpredictable.

[LeTiss]

I predict a General Election due to the coalition breaking down, and a total farce developing as we end up with another hung parliament.

I also predict Arsene Wenger will leave Arsenal to become the manager of England

[Iron]

I predict a General Election due to the coalition breaking down, and a total farce developing as we end up with another hung parliament.

That would be very funny if it were another Con-Lib coalition!

Jeff

[superfrank]

I predict that central bankers and governments, at the request of the private bankers, will continue to do everything in their power to reflate a broken economic model irrespective of the long term consequences thus further increasing the chances of a crack-up boom.

It's so far been true in 2008, 09, 10 and 11 and we all know they won't change course (follow the trend Jeff!).

Definition "Crack-up boom":

The final short-lived boom that occurs in the last stages of a seemingly endless inflation. The crack-up boom results from a "flight into goods or real values" and marks the end of an inflation by a complete breakdown of the monetary system.

Definition "Crack-up boom" by Ludwig von Mises:

The wavelike movement affecting the economic system, the recurrence of periods of boom which are followed by periods of depression, is the unavoidable outcome of the attempts, repeated again and again, to lower the gross market rate of interest by means of credit expansion. There is no means of avoiding the final collapse of a boom brought about by credit expansion.

The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.

[Iron]

I predict a General Election due to the coalition breaking down, and a total farce developing as we end up with another hung parliament.

I love this recent quote from Vince Cable:

"I'm sending no Christmas cards to Tory MPs, but I look forward to getting back to business working with them in the New Year."

Jeff

[Iron]

It's so far been true in 2008, 09, 10 and 11 and we all know they won't change course (follow the trend Jeff!).

*Throws hands in air*
I give up!

Definition "Crack-up boom":

The final short-lived boom that occurs in the last stages of a seemingly endless inflation. The crack-up boom results from a "flight into goods or real values" and marks the end of an inflation by a complete breakdown of the monetary system.

The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.

Lots of Western sovereign debt is due for repayment in 2012. To pay off the expiring bonds, new bonds will need to be issued. The problem is that, this time, the interest rates asked for by the markets will be higher. Unless growth picks up, things will come to a head sooner or later IMHO...

Jeff

[superfrank]

It's so far been true in 2008, 09, 10 and 11 and we all know they won't change course (follow the trend Jeff!).

*Throws hands in air*
I give up!

I also predict that in 2012 Jeff won't execute a trend following trade but will continue to post on how it is the route to immense riches.

sorry mate, couldn't resist!

[Iron]

Professor Larry Lang: ‘Every province in China is Greece’ - http://investmentwatchblog.com/professo ... is-greece/

[Iron]

I also predict that in 2012 Jeff won't execute a trend following trade but will continue to post on how it is the route to immense riches.

sorry mate, couldn't resist!

You never know - You might convince me to put my faith in approaches which are unproven, like someone swapping Western medicine that's undergone years of rigourous testing for a bottle of aloe vera.

I'm told you can use stats to prove anything, so why bother looking for hard evidence of an edge?

If it looks good and feels good, and lots of experts believe in it, then that's good enough for me!

Oh maybe not...

Jeff

[LeTiss]

2011 - We didn't hear too many updates on your Plenty of Fish progress, Jeff!

[Iron]

There wasn't much to report!

Jeff (Happily single)

2011 - We didn't hear too many updates on your Plenty of Fish progress, Jeff!

[Iron]

Prince Harry captured. 600 of our soldiers killed. In this terrifying plausible account, DOMINIC SANDBROOK imagines the day the Argies retook the Falklands

Read more: http://www.dailymail.co.uk/news/article ... z1hMCmNbUd

[Euler]

Maybe scientists will finally crack how to perform nuclear fusion in 2012, then the world would take a massive step forward with virtually unlimited energy.

[Euler]

I think it would be quite fun to post up some predictions and review them next year.

This is what prompted the thought: -

Crappy New Year! Stocks Will Fall 35% in 2012 Says Schoenberger

http://finance.yahoo.com/blogs/breakout ... 42361.html