Tuesday, January 1, 2013

Forecast 2013

Before I rub the crystal ball and reveal my 2013 calls, let me reflect, as this is a mediation period and recall my 2012 predictions.
I was spot on in my weather call as Hurricane Sandy after-effects still cause serious damage to many households. I also sadly called the drought problem. I do not see a bad hurricane season, but I see the drought continuing in 2013.
I called every election except the one in France and although presently, the Euro is in an uptrend, my call that it would hit a new low was correct. I see another new low in 2013.
My black swan call on derivatives is still a danger in progress, however my investment advice on coal was off the mark. My other investment calls on the media and trains returned profits as well as my long-term bullish stance on gold which has made money twelve years in a row.
the pundits will push the banking industry and with the Fed manipulating investment choices, who can blame them. Nevertheless, I would not follow the herd on this call because in the second set of books, the banking industry hides their toxic securities and another three million homes that need to be foreclosed upon. The banks along with the Fed policy is using the drip I-V recovery method for the housing industry. The media plays along and together they are turning the public perspective about the housing market. Bottom line: a repeat of 2012 but a possible big downside.
Of course, the most important news and the reason why I delayed this piece one day, is the fiscal cliff call on the budget. As I stated many times, President Obama is an appeaser. He has already doubled the "middle class" threshold in negotiating with Congress. He says, he won't budge on spending cuts unless equal taxation is applied, however the pending battle on the debt ceiling will show that he is indeed an appeaser with no plan or convictions. Can you believe anyone who says $450,000 is middle class? The best thing is for our nation to go over the cliff and maybe, some reality about our economy will reset the national thinking. That is the hope, but the reality is some cheaper version will be reached. The real story will be money for the states with budget shortfalls. This will determine the national economy for 2013.
or lack of it would describe our present day government.  Not only is the fiscal cliff a problem, but we learn that there needs to be a diary fix or a gallon of milk will cost over $7 dollars. We find that there needs to be a doctor fix, so payments under Medicare and Medicaid will be carried over into 2013. There are other fixes too like the extension of unemployment benefits, spending cuts for the military and other government contract deals. I see them all getting extended by these weak leaders. All these lies hide the fact that our government is corrupt.and deceiving its citizens. Our economy is losing its capitalism to socialism with the government causing what little GDP that we attain. The Simpson-Bowles agreement was a glance at reality and this government cannot allow the truth to be known. Bottom line: Free trade is a lie that is destroying America and until this is addressed, nothing will change for our benefit. Gold will hit over $2,000 in 2013.
Other Elections
will see the same leaders in Germany and Italy and a continuation of the same policies unless some black swan event causes a turn to the truth.
Other Dangers
This could be an attack by Israel with Iran. A hacking event that causes a world interruption. This will result when this happens, with new laws that will force Internet security expenses by companies which will result in higher inflation to the global community. There is a slight possibility that Japan will have a financial problem with its new policy of debasing the Yen. All these scenarios will only help gold, but I see the dollar climbing higher at first which will lower the price of gold and oil until the realization that the world central banks are printing worthless paper with no backing. This awareness will cause our Fed to lose control of interest rates that will rise, eventually causing world havoc in the financial markets. This may cause the One World people to suggest a new world reserve currency. This will hurt America as inflation will show its ugly head. Our role will end up being a less powerful economic force with China rising in influence, after all, it is the year of the snake.