Predictions for 2011

2011 is going to be the year for the wise investor. People who worry excessively about the macro-economic story will miss out on opportunities. People who focus on investing in strong global companies with good balance sheets will prevail and thrive.

At a macro level in the US:
- Oil will rise and rise. We will see $4.50+ per gallon oil. We will also see an increase in food, gas, healthcare, education prices
- Long term interest rates will continue to rise. Borrowing costs will rise.
- Unemployment rate will drop. Wages and salaries will rise. The economy will grow.
- Real estate will rise
- Stock indexes (S&P 500) will see new highs.

We will see a return of animal spirits. However, the euphoria will be tempered by:
- increased tensions with China
- towards the end of 2011, short-term interest rates will rise

Globally, there will a lot of problems.
- European Union will come under intense pressure. One or more countries will opt out of the EU. This will raise serious concerns about the future of the Euro currency
- China's economy will slow down, however, it won't slowdown excessively. Parts of the economy will continue to grow. Chinese real estate will come down dramatically.
- Australian and Canadian real estate will collapse. Their economies will come under stress

Lastly, about India:
- India is walking on very thin ice. Within the next 2 years, India will have a balance of payment crisis. This will shock the world and burst the Indian bubble story. However, the US will step in to bail out India.
- Indian Rupee will drop dramatically and faster than anyone will anticipate. By the end of 2011, INR will be trading somewhere between Rs60-65 (or more) to the USD.
- Indian inflation will continue to skyrocket. Food prices will double (or triple) by the end of the year. This will cause grave problems for the Indian government. The government's solutions will exacerbate the problem and cause food riots.
- Maoists will continue to expand their reach to other states.
- India real estate, stock markets, etc will rise in INR terms. In dollar terms, they will fall. (e.g. if a house costs Rs45,000 today, then in $$ terms it is USD1000. Let's say at the end of the year, the house is Rs60,000, but the exchange rate is 1USD = Rs 65, it would mean the house price when priced in USD terms would be USD 923) Precious metals (gold, silver, platinum, palladium) prices will continue to rise and will end the year higher.

Geopolitical tensions will rise, specifically US - China tensions will rise.

http://forums.sulekha.com/forums/finance/predictions-for-2011-19396.htm

There will be clouds; so it "may" rain. (I say "may" because I can switch to either side]. Thank you!

India real estate, stock markets, etc will rise in INR terms. In dollar terms, they will fall. (e.g. if a house costs Rs45,000 today, then in $$ terms it is USD1000. Let's say at the end of the year, the house is Rs60,000, but the exchange rate is 1USD = Rs 65, it would mean the house price when priced in USD terms would be USD 923)

Great logic HHM? Where did you get your degree from? And for this you need prediction too? Excellent. Which kalikyulator you use? Casion fx-72 that runs on LED and AA batteries? Kahan se kharida? Burma bazar of the yore?

The Absolute Zero wrote:

India real estate, stock markets, etc will rise in INR terms. In dollar terms, they will fall. (e.g. if a house costs Rs45,000 today, then in $$ terms it is USD1000. Let's say at the end of the year, the house is Rs60,000, but the exchange rate is 1USD = Rs 65, it would mean the house price when priced in USD terms would be USD 923)

Great logic HHM? Where did you get your degree from? And for this you need prediction too? Excellent. Which kalikyulator you use? Casion fx-72 that runs on LED and AA batteries? Kahan se kharida? Burma bazar of the yore?

??? what's your point?

See my predictions regarding euro.

harharmahadev wrote:2011 is going to be the year for the wise investor. People who worry excessively about the macro-economic story will miss out on opportunities. People who focus on investing in strong global companies with good balance sheets will prevail and thrive.

At a macro level in the US:
- Oil will rise and rise. We will see $4.50+ per gallon oil. We will also see an increase in food, gas, healthcare, education prices
- Long term interest rates will continue to rise. Borrowing costs will rise.
- Unemployment rate will drop. Wages and salaries will rise. The economy will grow.
- Real estate will rise
- Stock indexes (S&P 500) will see new highs.

giggle

harharmahadev wrote:
We will see a return of animal spirits. However, the euphoria will be tempered by:
- increased tensions with China
- towards the end of 2011, short-term interest rates will rise

snicker

harharmahadev wrote:
Lastly, about India:
- Indian Rupee will drop dramatically and faster than anyone will anticipate. By the end of 2011, INR will be trading somewhere between Rs60-65 (or more) to the USD.
- Indian inflation will continue to skyrocket. Food prices will double (or triple) by the end of the year. This will cause grave problems for the Indian government. The government's solutions will exacerbate the problem and cause food riots.
- India real estate, stock markets, etc will rise in INR terms. In dollar terms, they will fall. (e.g. if a house costs Rs45,000 today, then in $$ terms it is USD1000. Let's say at the end of the year, the house is Rs60,000, but the exchange rate is 1USD = Rs 65, it would mean the house price when priced in USD terms would be USD 923) Precious metals (gold, silver, platinum, palladium) prices will continue to rise and will end the year higher.

chortle followed by giggling snicker

[quote="Propagandhi711"]

harharmahadev wrote:

giggle

snicker

chortle followed by giggling snicker

BWAH-HAHAHAH!!

how can a man be wrong on almost all counts when even a failing clock is right twice a day?

S&P making new highs (ed: snicker), gas at 4.50/gal (ed: currently at 3 dollas), interest rates rising (ed: snicker), wages rising (ed: giggle), economy growing (ed: uproarious laughs), rupee at 62-65/dollar (ed: snide guffaws), precious metals ending the year at a high note (gold in bear market territory as of 12/29 & silver down abt 40+% from recent highs, snicker).

I'll continue to consult my monkey for financial predictions, than you very much.

not to forget real estate rising in the US (ho ho ho)

Propagandhi711 wrote:how can a man be wrong on almost all counts when even a failing clock is right twice a day?

S&P making new highs (ed: snicker), gas at 4.50/gal (ed: currently at 3 dollas), interest rates rising (ed: snicker), wages rising (ed: giggle), economy growing (ed: uproarious laughs), rupee at 62-65/dollar (ed: snide guffaws), precious metals ending the year at a high note (gold in bear market territory as of 12/29 & silver down abt 40+% from recent highs, snicker).

I'll continue to consult my monkey for financial predictions, than you very much.

Guys like you and Merlot and whatshisface argue just for the heck of it. You guys suck at stock picking and assume that everyone is a loser like you!

Gold was at ~$1300 and ended the year at ~$1525...which is a whopping +22% gain, you fucking idiot!!! That's one of the best performing asset classes in the world!

My prediction on the trend on the INR was spot on. Remember this - on Jan 1 2011, NO ECONOMIST, and I mean NO ECONOMIST WAS PREDICTING A STEEP DECLINE OF THE INR!! I stuck my head out when I made this call. I think the INR decline is a work-in-progress. By end of 2012, INR will continue to decline to the 80+ against the USD. More on that later.

Regarding Euro, my calls were almost prescient. Now, maybe you are disappointed that I'm not measuring to the level of perfection you have come to expect from me and I understand that, but you have to realize the hard truth that I am an economist, not a fortune teller.

Regarding US, my predictions have been choppy and I accept that.

harharmahadev wrote:

Propagandhi711 wrote:how can a man be wrong on almost all counts when even a failing clock is right twice a day?

S&P making new highs (ed: snicker), gas at 4.50/gal (ed: currently at 3 dollas), interest rates rising (ed: snicker), wages rising (ed: giggle), economy growing (ed: uproarious laughs), rupee at 62-65/dollar (ed: snide guffaws), precious metals ending the year at a high note (gold in bear market territory as of 12/29 & silver down abt 40+% from recent highs, snicker).

I'll continue to consult my monkey for financial predictions, than you very much.

Guys like you and Merlot and whatshisface argue just for the heck of it. You guys suck at stock picking and assume that everyone is a loser like you!

Gold was at ~$1300 and ended the year at ~$1525...which is a whopping +22% gain, you fucking idiot!!! That's one of the best performing asset classes in the world!

My prediction on the trend on the INR was spot on. Remember this - on Jan 1 2011, NO ECONOMIST, and I mean NO ECONOMIST WAS PREDICTING A STEEP DECLINE OF THE INR!! I stuck my head out when I made this call. I think the INR decline is a work-in-progress. By end of 2012, INR will continue to decline to the 80+ against the USD. More on that later.

Regarding Euro, my calls were almost prescient. Now, maybe you are disappointed that I'm not measuring to the level of perfection you have come to expect from me and I understand that, but you have to realize the hard truth that I am an economist, not a fortune teller.

Regarding US, my predictions have been choppy and I accept that.

every fucking currency declined against dollar so come back with something else. I just copied your predictions and how almost all of them were wrong. you might have some good stock ideas (might) but your insistence on writing some open-ended macro shit and claiming victory when your performance is worse than a monkey throwing darts irks me. you just read like someone that reads a bunch of newsletters and copies them here verbatim and expects high praise for his prescience. if you are all that you claim, bloomberg/cnbc would be queuing outside your mansion begging for your comments on the morning show a la' stephen roach/mohammed el-arian. everybody and his monkey can watch some talking heads on TV and make macro predictions on their own. predictions.....economist, my ass.

as for your claim that gold is up 22% in 2011, I guess you're revising your earlier commentary that it'll be making new highs at EOY? new high in gold woulda been 1900+, numbnuts.

Propagandhi711 wrote:as for your claim that gold is up 22% in 2011, I guess you're revising your earlier commentary that it'll be making new highs at EOY? new high in gold woulda been 1900+, numbnuts.

huh???

Where did you see a revision?? The prediction was the gold would end higher at the end of the year compared to the start of the year. You have to be a major moron to think that I was predicting gold prices would peak at the very end of the year!!

Propagandhi711 wrote:
every fucking currency declined against dollar so come back with something else. I just copied your predictions and how almost all of them were wrong. you might have some good stock ideas (might) but your insistence on writing some open-ended macro shit and claiming victory when your performance is worse than a monkey throwing darts irks me. you just read like someone that reads a bunch of newsletters and copies them here verbatim and expects high praise for his prescience. if you are all that you claim, bloomberg/cnbc would be queuing outside your mansion begging for your comments on the morning show a la' stephen roach/mohammed el-arian. everybody and his monkey can watch some talking heads on TV and make macro predictions on their own. predictions.....economist, my ass.

You are so fucking thick that I find it pointless to discuss this but I will try anyways because its my nature to share my knowledge to the less fortunate!

INR was the worst performing currency in Asia and probably in the world!! Inspite of all the hubbub about the Euro, the decline was no where close to that of the INR. No fucking talking head in the world singled out the INR!!! Not Roach...not El Arian...NOBODY!! I did!!

Please give credit where credit is due!

harhar: any advice for 2012? i'm thinking of aggressively paying down my mortgage this year every chance i get because i don't think i can get a guaranteed 3.75% return anywhere. that was my thought till my morning drive in. however, tom ashbrook on NPR was hosting a show on precisely this topic (where to look for opps in 2012) and one caller in the same situation as me said he was going to be buying high dividend paying stocks. that has given me a bit of pause.

indian banks are giving 9% interest on NRE deposits. and it's not taxed in india. that beats your 3.75 guaranteed return easily

harharmahadev wrote:

Propagandhi711 wrote:
every fucking currency declined against dollar so come back with something else. I just copied your predictions and how almost all of them were wrong. you might have some good stock ideas (might) but your insistence on writing some open-ended macro shit and claiming victory when your performance is worse than a monkey throwing darts irks me. you just read like someone that reads a bunch of newsletters and copies them here verbatim and expects high praise for his prescience. if you are all that you claim, bloomberg/cnbc would be queuing outside your mansion begging for your comments on the morning show a la' stephen roach/mohammed el-arian. everybody and his monkey can watch some talking heads on TV and make macro predictions on their own. predictions.....economist, my ass.

You are so fucking thick that I find it pointless to discuss this but I will try anyways because its my nature to share my knowledge to the less fortunate!

INR was the worst performing currency in Asia and probably in the world!! Inspite of all the hubbub about the Euro, the decline was no where close to that of the INR. No fucking talking head in the world singled out the INR!!! Not Roach...not El Arian...NOBODY!! I did!!

Please give credit where credit is due!

dickhead, you said INR will be 60-65 this year. it's 53. big fucking difference, wouldnt you say?

Propagandhi711 wrote:indian banks are giving 9% interest on NRE deposits. and it's not taxed in india. that beats your 3.75 guaranteed return easily

thanks. i guess i will have to weigh currency risk against my current scenario.

[quote="Propagandhi711"]

harharmahadev wrote:

dickhead, you said INR will be 60-65 this year. it's 53. big fucking difference, wouldnt you say?

Langoor kya jaane angoor ka swaad!! Yes, it's 53 and not 60+.....it's the overall economic trend, stupid! I have correctly identified the trend...the numbers will follow! I'm an economist not a fortune-teller.

Propagandhi711 wrote:indian banks are giving 9% interest on NRE deposits. and it's not taxed in india. that beats your 3.75 guaranteed return easily

9% interest in USD or INR?? If it's INR then that's it's useless since the currency depreciation negates any interst growith.

MaxEntropy_Man wrote:

Propagandhi711 wrote:indian banks are giving 9% interest on NRE deposits. and it's not taxed in india. that beats your 3.75 guaranteed return easily

thanks. i guess i will have to weigh currency risk against my current scenario.

It has been a while since i dealt with the Indian banks and their NRE stuffs. Do they still convert your $100 into rupees and RECONVERT later at the prevailing rate ? In that case, your $100 might lose 10 to 15% with Rupee devaluation and end up with less money in the end.

I lost 25% like that but that was a very small amount.

harharmahadev wrote:

Propagandhi711 wrote:indian banks are giving 9% interest on NRE deposits. and it's not taxed in india. that beats your 3.75 guaranteed return easily

9% interest in USD or INR?? If it's INR then that's it's useless since the currency depreciation negates any interst growith.

i thought NRE accounts have to be maintained in rupees, but i could be wrong.

Marathadi-Saamiyaar wrote:

MaxEntropy_Man wrote:

Propagandhi711 wrote:indian banks are giving 9% interest on NRE deposits. and it's not taxed in india. that beats your 3.75 guaranteed return easily

thanks. i guess i will have to weigh currency risk against my current scenario.

It has been a while since i dealt with the Indian banks and their NRE stuffs. Do they still convert your $100 into rupees and RECONVERT later at the prevailing rate ? In that case, your $100 might lose 10 to 15% with Rupee devaluation and end up with less money in the end.

I lost 25% like that but that was a very small amount.

i saved you the trouble of writing one whole paragraph by referring to it as "currency risk". you are soon going to become a member of the whitney writing club.

MaxEntropy_Man wrote:

Marathadi-Saamiyaar wrote:

MaxEntropy_Man wrote:

Propagandhi711 wrote:indian banks are giving 9% interest on NRE deposits. and it's not taxed in india. that beats your 3.75 guaranteed return easily

thanks. i guess i will have to weigh currency risk against my current scenario.

It has been a while since i dealt with the Indian banks and their NRE stuffs. Do they still convert your $100 into rupees and RECONVERT later at the prevailing rate ? In that case, your $100 might lose 10 to 15% with Rupee devaluation and end up with less money in the end.

I lost 25% like that but that was a very small amount.

i saved you the trouble of writing one whole paragraph by referring to it as "currency risk". you are soon going to become a member of the whitney writing club.

Yep...the official operative word is currency risk

MaxEntropy_Man wrote:

Marathadi-Saamiyaar wrote:

MaxEntropy_Man wrote:

Propagandhi711 wrote:indian banks are giving 9% interest on NRE deposits. and it's not taxed in india. that beats your 3.75 guaranteed return easily

thanks. i guess i will have to weigh currency risk against my current scenario.

It has been a while since i dealt with the Indian banks and their NRE stuffs. Do they still convert your $100 into rupees and RECONVERT later at the prevailing rate ? In that case, your $100 might lose 10 to 15% with Rupee devaluation and end up with less money in the end.

I lost 25% like that but that was a very small amount.

i saved you the trouble of writing one whole paragraph by referring to it as "currency risk". you are soon going to become a member of the whitney writing club.

Yes...but remember I was not responding just for you...but for the Economics-challenged people (including myself). After all, this is not some intellectual forum for economists (alone).