Monday, January 05, 2009

End of year business, Post Mortem on Predictions

So I held out till the very last hopping a final run would sort out the rancid state of my yearly predictions for 2008, alas it did not happen.

My gold and silver predictions were abysmal well off the 1200/25 mark I had envisioned. The instability of the financial markets should have driven people to real assets but too many hedge funds and personal investors had to cover margins and the sorry legitimacy of the Comex both crushed metals. On the good side private investors are still accumulating and no glut of product is flooding the market, this bodes well that the bull is resting not dead. I wonder how much supply small investors would absorb if the mints could supply the small products people are demanding?

In the currency pit I was pitiful. While I called the Canadian dollar high I did not call it’s subsequent slump as I did not expect commodities to get nuked the way they did, neither can I rationalize the U.S. dollar strength, WTF?
A country that is borrowing, printing and defrauding the way the U.S. has been doing should have zero credibility, this mock strength will be shown as a blip and a great opportunity to short the dollar for the next collapse, but how long before the wake up is obviously hidden to my apparently blurry vision.

I also did not see the wide spread dropping of the dollar peg I expected but with its recent strength that is simply postponed not cancelled. The talk of a Arab common currency (possibly linked to gold) is a plus as well there has been some movement towards a basket of currencies vs just the U.S. dollar in the Gulf.

In the correct column I did call the massive slide in interest rates yet even I (one of the most bearish people I know) did not see nil rates in 2008. I was calling for a reduction of to at least 2% which when I made it was considered ludicrous.

I did call the bank failures but expected many more small failures before now.

No war in Iran

$140 oil was a good pick yet the subsequent slump makes no sense with my low being $90 yikes, was not seen and has more to due with deleveraging of funds than the bogus “demand destruction” argument. World demand is not going to shrink massively, new wells will not be brought on at today’s price, depletion is accelerating and this is going to blow up in our faces making this years highs pale in comparison. At today’s prices Oil and NG may well have more upside than metals in 2009.

Recession, uneployment up, housing defaults up, credit lines/ credit cards being called, reduced or cancelled were all good general calls for the year.

I will attempt a new set of predictions within the next 2 weeks

1 comment:

CHR said...

Don't be too hard on yourself for not hitting too many of your predictions; there won't be many folks who would have seen this all coming. Even folks like Peter Schiff, who saw the financial collapse coming, still got it wrong in predicting gold/silver to take flight. As much as history and gut should have made that call a no brainer; it just didn't happen. Even those with much better than average 'forward vision' would have been amazed to see how much has played out in a single business quarter.

Unfortunately, still lots to come ...

The ARM-resets for another 18 months, the Big Three hitting the event horizon and collapsing down to the Little One, American retailers all over Main Street closing up for good due to the American shopper going MIA over Christmas .. and then the bursting of the biggest bubble of them all; the US Treasury bubble. As LoW suggests, due to zero credibility and half a quadrillion dollars in derivatives.

Half a quadrillion dollars .. nice ring, don't you think?

What will the US do when "it all costs money" but ~their~ money is no longer worth much due to runaway inflation? Hint: it involves weapons!