This page has been archived and commenting is disabled.
2012 - Things that will happen
Significant economic and political changes will make 2012 a historical year. The globe has experienced relative calm for the past 24 months. That stability won't last much longer. Events that are not on anyone's radar screen will matter the most. The following are the things that I think might happen, but it's the surprises that worry me.
-Silas Kiplagat will win the 1500-meter race at the Summer Olympics in London. The time will be 3:33:22.
-Obama will drop Joe Biden from the ticket. Obama will want a Veep that has a chance to be a viable presidential candidate. He will chose Hillary Clinton.
-Green Bay will beat Denver in the Super Bowl. (Millions of Christians will be disappointed).
-Mitt (the suit) Romney will be the Republican presidential candidate. The nomination will be a fight to the very end. Newt (the fool) Gingrich will come close, but will not get the nod. Romney will announce that his running mate will be South Carolina Governor, Nikki Haley. Her presence on the ticket will give Mitt a chance.
-Ron Paul will run as a third party candidate (Green) He will get 10% of the popular vote. He will upend any chance the Republicans have.
-The presidential election will go to Obama. Ending up with only 44% of the vote, he will not have a mandate. The battleground states will be Pennsylvania and Ohio. Billions will be spent on getting the votes in those states. Pennsylvania will go to Obama. Ohio will go with Romney. The electoral vote margin will be very narrow as a result.
-The Kepler spacecraft (link) will identify a planet that has the capacity to sustain life (the ultimate safe haven). The scientists at CERN will confirm the observation of particles exceeding the speed of light. These developments will result in significant rethinking by the scientific community.
-The Senate will be split evenly between Democrats and Republicans. The new VP will have deciding votes on several key issues.
-Republicans will retain their majority in the House. Gridlock will be the outcome. There will be no new legislation of significance in 2012. A lost year.
-Iran will attempt to disrupt sea traffic in the Straits of Hormuz. Naval exercises by NATO, USA and China will be required to escort tankers through troubled waters. There will be an incident culminating in shots being fired. It will scare the hell out of everyone, but full military action will be avoided.
-Iraq will fall into sectarian violence. Car bombings will beset the country. The Kurds, in the north, will attempt to separate themselves from Baghdad. Turkey will get involved as a result of border problems. In the south (Basra/oil ports), the local Shia government will ask neighboring Iran, to help bring stability. The Iranians will establish a police presence.
-Brent crude prices will swing between a low of $80 and a high of $155. The highest level will be reached in September.
-Australia will suffer from a significant economic slowdown. The A$ will fall to 90 versus the buck.
-Cyprus will make a significant new gas find. This will result in territorial claims by Turkey. The UN, lead by Russia, will get involved in the dispute.
-Europe’s economic problems will not be solved. Every effort will be made to kick the can down the road. Neither the can nor the road will collapse; that will happen in 2013. EU GDP will struggle to hold zero.
-It will be confirmed that Iran has nukes and the capacity to deliver them. Iran will successfully test fire a Shahab 3c missile. Israel will not attack Iran.
-The US housing market will stabilize. Rental costs will rise by 7%. This, coupled with extremely low debt costs, will increase the demand for homes. In addition, the costs of constructing new homes will soar due to rising costs of materials. Virtually everything used to build a home (from cement to shingles) will rise in price by 10%. Construction of new homes will remain muted as a result.
-During the year, the ECB will be forced to actively intervene in the EU bond market on multiple occasions. Ten-year yields for Italy will range from 5 to 8%. Spanish yields will rise to 10% at one point. French bonds will reach 7%. The enormous refinancing requirements of EU countries and banks will be a constant problem. The market will become obsessed with the weekly bond auctions. There will be many disappointing results.
-The EU banks will struggle, kept alive by LTROs and E150B of new equity injections into the banks (a la Tarp). Public assistance to the banks will exceed E1 Trillion. The EU banks will not adopt the Basel Core Tier 1 capital ratio of 9% in June; the planned recapitalization will be shelved for a year. There will be much discussion about the scale of the government's involvement, which will be recognized as unsustainable. By year's end, the noose will be tighter and the financial options greatly diminished. By December 2012, the Euro Zone won't be expected to survive another year.
-The Swiss National Bank will maintain the 1.20 peg to the Euro. By the end of the year, the talk will be about how much longer the peg will continue. The SNB will acknowledge that the peg was a temporary measure. The speculation will be about how long “temporary” actually is.
-The Euro will range from a high of 1.4 to a low of 1.15. The low for the year will occur in November.
-The Yen will (finally) weaken. The low for the USDYEN will be 76.5 the high will be 90. (It's a great short). The problem for Japan will be its 200% debt to GDP. Global investors will shun the Japanese bond markets. Ten-year yields will rise to over 2% as a result. While Japan has gotten away with its excessive debt for years and global investors always had reasons to park cash in Japanese Government Bonds (JGBs), there will be no reasons left in 2012.
-As the US's presence in Afghanistan winds down, the Taliban will retake the country. The chaotic US exit will be compared with the end of the Viet Nam war.
-The Syrian government will fall. The country will face an uncertain future. There will be sectarian violence in Libya. Sophisticated weapons, including SAM missiles will be used. In Egypt, Field Marshal Tantawi, will consolidate power. Protests will continue throughout the region. The MENA economies will broadly suffer.
-The S&P will range from a low of 900 to a high of 1400. The high for the year will occur before June.
-The US GDP will languish. Growth will range from 1.5 to 2%. There will be clear evidence of a slowdown by mid-year. Unemployment will fall to as low as 8.5%, but will end the year back above 9%. The BLS will report 1.6mm of new jobs created during the year but the "birth/death" model will reduce that by 600,000. Labor force participation will continue to decline.
-Modest economic activity and core inflation above 2% will tie the Federal Reserve’s hands for the first part of the year. Politics will prevent it from acting prior to the election. In December of 2012, the Fed will be free to initiate another round of QE - an $800 billion Large Scale Asset Purchase (LSAP) will follow. The Fed’s new POMO operations will be divided equally between Treasury bonds and Agency Mortgage paper.
-The Vix will be volatile. The average for the year will be 30. It will exceed 45 twice.
-Greece will continue pretending it wants to be in the EU and tied to the Euro, until July. Its deteriorating economy and inability to service its restructured debt will force Greece to leave the EU and re-establish the Drachma. The New Drachma will trade as high as 1,000 to the dollar (800/Euro). When the Drachma is brought back (over a weekend), the Greeks will formally default on their external debt. This won't be the crisis that everyone fears, but it will add to the instability in the other peripherals. Populations in Ireland and Portugal will protest that their countries should follow Greece’s steps.
- The Academy Award winners:
Best Movie War Horse
Best Director Steven Spielberg
Best Actor George Cloony
Best Actress Michelle Williams
Best Support. Actor Christopher Plummer
Best Support. Actress Jessica Chastain
Best Orig. Screenplay The Tree of Life
Best Adapted " War Horse
-North Korea will be a problematic. Counter to expectations, Kim Jung-Un will not be the actual ruler. The generals will conspire with Kim’s uncle, Jan Song Taek, to take over leadership. There will be an occasional pop shot from north to south. The real trouble will come when NK boards and then sinks a S. Korean fishing vessel. This will bring US aircraft carriers off the shores of NK. China will hate this development. A nasty incident is the most likely outcome.
-The Miami Heat will fail to make the playoffs. LA will beat Boston.
-Keynesian economic thinking will be further discredited in 2012. The pump-priming Keynesians had their day in the sun, and now people will want a different approach. Paul Krugman will write a total of 100 blogs decrying this development. Larry Summers will write an OpEd for the WSJ warning that the US faces a strategic crisis if it does not contain the trajectory of the national debt.
-Gold will be very volatile. It will fall to below $1400 at one point. It will end the year above $2000.
-There is a significant risk of a big economic hiccup at the end of the year. The election has deferred dozens of tax/spending issues to 1/1/13. There is enough deflationary firepower built into the system to trigger a big slowdown. Post election, there will be just weeks to sort it out, or face the music. The drama and the pain of the just completed election will make it impossible to avoid a conflict.
-Japan will confront two divergent issues. Debates regarding the future development of nuclear energy for civilian use will arise as the true costs of the disaster at Fukushima are realized. Significant portions of the country will have to be abandoned. Costs of encapsulating and cleaning up will exceed $50 billion. At the same time, a growing force within the country will push to develop tactical nuclear weapons. The US's mandatory budget cuts for its military will elicit an extraordinary change which will take years to play out. Japan will lose confidence that its "protector" will be able to protect it.
-India will surprise everyone. GDP growth will fall from 9% to 3% (well under stall speed). Inflation will exceed 10%. The trade and current account deficit will rise. The Rupee will hit 60 per dollar.
-China’s GDP will fall to 4%. China has already overspent in infrastructure development. The buildout of empty cities will slow and unemployment will rise rapidly. This will stress the country and lead to political protests in many cities.
-Tiger Woods will win a major.
-China will continue to fund the west. It will allocate more capital to the core countries of Europe. China will get trade deals in exchange for its willingness to buy bonds. The holdings of US treasury debt will decline modestly for the year. The Chinese will react to the ongoing pressure from the US to force the Yuan to appreciate by doing precisely the opposite. The CHY will be worth the same next year as it is today.
-Bank of America will be forced to pare down its asset base. The stock will spend most of the year under $5. The subordinated debt will trade cheap.
-Goldman Sachs will go private. There will be many layoffs. The Squid will end up stronger than ever.
-The San Francisco Giants will win the World Series. The Yanks will be the loser.
-In March, it will finally be determined that MF Global used re-hypothecation to fund its operations. The customer losses will be attributed to this activity. Realized customer losses will exceed $1B. JPM will be identified as one of the banks that grabbed MFG assets in the final days. Customers will file civil claims against JPM, but those will be dismissed. Criminal charges will not be filed against MFG, Corzine nor JPM. The flaws in the system will be attributed to Reg. T. The Fed will promise a thorough review of the country’s margin rules. Nothing will be completed until 2013.
-AAPL will trade as high as $450. It will end the year under $350. The company will come out with a TV that won't be much of a success. Apple will lose out to Amazon (and others) in the "Cloud". This will prove to be a strategic error.
-The cost of solar panels will fall to a level where large scale, privately funded solar farms become viable. The debt for these farms will be functionally secured by a public utility and will be repackaged with shorter maturities that have a AAA rating. The lowest tranches of debt will have returns as high as 20%. Wall Street will love it and so will investors. Some utility stocks will do well as they have secured a source of renewable energy that meets the recently legislated requirements (RECs).
-Boeing’s shares will fall to $55. There will be problems with the Dream Liner.
-Dividend stocks will underperform the broad averages. The observation will (finally) be made that this is a very crowded trade and 2% does not compensate investors for their risks.
-Creative Cause (son of Giant's Causeway) will win the Kentucky Derby.
-The Chevy volt will suffer from numerous battery problems. There will be fires that result in serious injuries. The future of GM’s electric car will come into question. The stock will fall to the teens. Tesla’s outlook will become uncertain. Obama’s investment in Tesla will be a campaign issue.
-La Nina conditions will persist for the first six months of the year, bringing a series of big storms to Asia. Substantial new flooding will occur in the Philippines and Thailand. West Texas will have another dry year, the central states will have above average rain, and the North East will have a very bad winter.
-Silver will follow gold up and down. It will underperform gold. It won't hit $50.
-Narco violence in Mexico will escalate. There will be gun play on the border. Mexico will reiterate its position that the problem is the demand from the gringos, not the supply from Mexico. This thinking will lead to renewed discussion on legalization of Marijuana. Phillip Morris’s stock will rise above $90 in anticipation.
-BRIC investments will continue to underperform. Several big hitters will repudiate this investment strategy. That will mark the bottom of these markets on a comparative basis.
-Global food inflation will continue to be a problem. Global growth will advance by 2%, the cost of feeding ourselves will increase by 5%. Asia/India will bear the biggest brunt of the increasing cost of food. Wheat prices will rise 12%.
-US inflation will remain on the high side. Core will average 2.5% (1/2% above the Fed’s target). CPI will come in at 3.8%. Real inflation will be much higher. Treasury Tips will underperform. The Ten-Year Tips/Coupon spread will widen to 2.75%.
-Few countries will avoid social protests and demonstrations. Many will turn violent. America will not be spared. The angst of the people will be directed at their leaders, their lenders and the IMF. A redo of 2011.
-The election will spur debate on the future of America’s entitlement programs. There will be broad based agreement that the time has come to address the problems with Social Security, Medicare and Medicaid. Politicians will try to divert the focus away from Social Security by pointing fingers at the Disability Insurance side of SSA. While it’s correct that this program is a complete disaster, the DI Fund is not the problem. The Retirement Fund is the real problem. The attention that DI will get is just a diversion from what is actually wrong with America’s favorite entitlement program. This will be a “young” versus “old” fight. Both sides will come to understand this.
-The summer of 2012 will bring the largest polar ice melt in history. The Mayan calendar will end with no consequence.
»
- advertisements -
Bruce Thanks for putting this out there Much food for thought happy New Year
Excellent and provocative thoughts, Bruce. I really enjoy reading your analyses.
Not sure if you hedged intentionally, but you've indicated that LA will beat Boston for the NBA championship. Which LA? My money's on the Clippers this season!
They both involve pulling something out of your ass.
Happy new year
"The US housing market will stabilize."
I just about fell off my chair laughing at this one.
Well, you can be in a stabilized descent.
is that like "gracefully drowning"?
Yeah, sort of like the good old cold war days of the early DARPA-Net, when they referred to the PTSN "gracefully degrading" as the mushroom clouds rose above American cities.
Bari Shabazz will be physically removed from the White House before the election.
America will realize that Obama pulled off the biggest con in world history and is the laughingstock of the world.
0bama moves to the Middle East and becomes the dictator of a small islamic nation.
America finally has realized that the media and 95% of policticians are lowlife scoundrels, many are assaulted. CBS, NBC, MSNBC, ABC, NYT all enter bankruptcy by 2013.
I make the boldest prediction of all: gold and silver down in 2012 because of economic recovery. Happening already.
...because of economic manipulation, you mean.
Fixed it.
You obviously have not learned your lesson about the strength of movies that amount to little more than a white mans apology to blacks, you completely shut out The Help which by the way did present some fine acting. Or, did you really think Crash was the best picture in 2005? Any film depicting white racism is going to win. Let's call it revenge for the robbing of Brokeback Mountain.
And you count the 49er's out way too early as well.
As to anything economic in the post; unless and until we see a return to the basic functions of real, unpolluted accounting practices and rigorous unbiased enforcement, there is no reason to bother reading them, they have as much validity or real life impact as the other games and races mentioned.
By the way, less economic and more geopolitical at this point would be that 2012 is the year that Greece leaves the EMU, and I think Ireland will as well and might even leave before Greece does. My prediction is based upon the furor of the silent majority that will not remain silent when the first real property tax is imposed there. They already have a high VAT that goes 2% higher to 24% this year. They have a highly progressive income tax, and they have a 7% stamp duty you pay on home sales that is in effect a sales tax on houses, or if you prefer a flat property tax that is all paid up front. They have a fuel tax that makes gasoline $9 per gallon, they have outrageous motor taxes and vehicle registration, even a TV will run you $160 per year for a license to own one of those. Now they will have a property tax that will range from a few hundred euro to thousands per year, and we all know that once you start such a tax you can't ever go back and it will always rise, never drop. It is in effect the confiscation of housing that you then rent back from the government. All to pay off crooked slime-ball bankers. Worse than that, crooked slime-ball French and German bankers. I think the people will rise up and say no more.
The LHC will break new ground in science by making a wormhole to the past through which we will see Mayans who, completely unable to make sense of our claims that we are from 2012, will encode the encounter as a prophecy.
Ron Paul will not run as a third party candidate. Romney will. Ron Paul will be nominated and the Republican party will run Romney as a third party candidate because the Republican party would rather have Obama elected than Paul. If Paul is elected, the Republican party will go broke without their cash flow from the defense contractors.
I doubt Ron Paul will win the nomination and he definitely won't run as a third party candidate. IMHO, it doesn't matter who wins, ( dem or republican) nothing will change.
Thanks for the good reads Bruce. Can you reconcile these two predictions below? It seems if you are right on the first one the second one would have a hard time coming true at the end of the year...
There is a significant risk of a big economic hiccup at the end of the year. The election has deferred dozens of tax/spending issues to 1/1/13. There is enough deflationary firepower built into the system to trigger a big slowdown
-Gold will be very volatile. It will fall to below $1400 at one point. It will end the year above $2000.
CERN will NOT find a faster than c particle...
They will find it but will determine that the particle does not actually "travel" faster than the speed of light. It will be man's introduction to "subspace" frequencies. Warping of spacetime will be understood as more common than previously believed and the technology will open the door to what used to be called "free energy."
:D
Thanks so much for your thoughts, Bruce.
You took me on another path ... it will be found that the particles actually slow down everything else in the universe around them, including light, such that they appear to travel faster than the speed of light.
Hey, its not much more far fetched than some of the other thinking in quantum mechanics, e.g. existence of Higgs Boson results in other particles having mass.
Could be. That would imply that this particle is actually more massive than its mass, which would, by definition then, have a heavier footprint in spacetime than it is "allowed" by physics.
The truth, though, is that our experience in this physical universe is not really an experience at all. Rather, it is a projection of reality given on the surface of what we call the physical world. It is the same idea as when the structural information of anything that falls into a black hole is retained on the surface of the black hole, while the actual object falls into oblivion.
In other words, we live in a holographic universe and there are ways to communicate by going below the surface, or what I would call "subspace." There is no other way to explain how anything can travel faster than the limits of spacetime, unless, of course, it weren't travelling in that realm. There is no other way to explain how a single electron can be in two different places at once.
Methinks science just got a kick in the throat and when the truth about this thing hits 88 miles an hour, you're gonna see some serious shit.
@ Orly, I always enjoy reading your comments, though you haven't posted in awhile. I struggle with my grammar, but yours is always impeccable and your comments flow like well-written poetry. I am looking forward to my third year of education, reading zerohedge articles, along with their intelligent, and oftentimes witty, member comment threads. Thank you, and God bless. I have followed politics for over 20 years and, while I have hope that RP will prevail, I would be comfortable with the candidate from Georgia, as well.
Dertt! Sorry. I forgot to mention Mr. Gingrich.
I remember back in- what was it- 1993? When The new Republicans came and took over and promised a smaller government, less intrusion and all that jazz. Newt was a strong player. Always with his chin out, seemingly ready to take a shot to the jaw. A true and earnsest believer.
I am afraid that it all turned out to be a well-played political soap opera that was carefully orchestrated with the aid of the media and acted out by a select group of others. The group included the man who covered up the Mena, Arkansas situation for the first Bush. Ergo, Curtain: Stage, "Second Reagan Revolution."
Theatre. All political theatre, I am afraid. Just look at what Newt has been able to accomplish for himself as a prominent figure in the US House and later as an author. He didn't get that well-off working for the people, if you ask me- and his movement has all but dried up in the vast wasteland that is the American political landscape since the death of JFK.
So, inasmuch as I hate to disappoint, my true fear is that Newt is a cog in the wheel; just another part of the machine.
Indeed he is --- a big, fat, loud, fearmongering, warmongering cog, who refuses to allow or even admit that the machine is heading toward a grinding halt.
I truly appreciate your sentiments, Lib. It's been a hella year, as I have learned so much.
Now I find that it is difficult to put my current line of thought into words. This is the kind of thing I have been learning; not only learning but finding myself in an intellectual and emotional struggle to accept as true ideas. I thought I was cool when I discovered the fakery of 9/11 for my own self! Hmmmm. Maybe I was- but this is much more profound.
The Holographic universe? Black holes have memory? The perfection of the sphere?
Sometimes my head spins! Ha!
Thank you for the honorable mention, especially since I still have so much stuff to sort out before I really understand. And it is very nice to be remembered. :D
Merry Christmas and may God bless you and yours, as well.
Olexsandra
They will, but it will be determined that there is no way to encode information that can be transnsmitted and received with them.
They will, and there will be a way to encode and transmit information with them, making the rental fee for server space on NYSE drop like a stone. Cabling systems for this new media will be called "CAT C+." HFT firms hire physicists in addition to math PHDs to try to figure out how to trade in the future. The process will become known as "stealing your future now, bitches."
Excellent post :)
You're in fine form today SWR *snicker*
Thanks for the chuckle :)
They will, but you won't know it because it will have shown up before you wrote this entry.
* War with Iran in October, regardless of the status of any nuke programme they might have.
* As a result of the Iran War, Obama is re-elected.
* Vice President-Elect Panetta will surprise everyone.
* Jon Corzine will be pardoned.
* Bill Clinton will be appointed to the Supreme Court.
* Rush Limbaugh, Mark Levin, and Sarah Palin will all be declared an enemies of the State and rendered to Club Gitmo.
* Michelle will test the fates one too many times and be caught wolfing down Big Macs and Fries on several occasions while on the campaign trail.
* The fifth 2-month of extension of the Payroll Tax reduction will go down to defeat.
* Republicans will lose control of the House and Senate as a Result.
* The Republican Party will be eclipsed by the Libertarians, and the US devolves into a series of coalition governments in future years.
* Mitt Romney will lead a buyout fund specialising in taking struggling green companies to profitability and eventual IPO.
* War with Iran in October, regardless of the status of any nuke programme they might have. YES
* As a result of the Iran War, Obama is re-elected. YES
* Vice President-Elect Panetta will surprise everyone. MAYBE
* Jon Corzine will be pardoned. YES
* Bill Clinton will be appointed to the Supreme Court. NO WAY
* Rush Limbaugh, Mark Levin, and Sarah Palin will all be declared an enemies of the State and rendered to Club Gitmo. NO WAY
* Michelle will test the fates one too many times and be caught wolfing down Big Macs and Fries on several occasions while on the campaign trail. LOL
* The fifth 2-month of extension of the Payroll Tax reduction will go down to defeat. DOUBT IT since election year
* Republicans will lose control of the House and Senate as a Result. THAT'S WHY they won't do it
* The Republican Party will be eclipsed by the Libertarians, and the US devolves into a series of coalition governments in future years. THAT' BE NICE
* Mitt Romney will lead a buyout fund specialising in taking struggling green companies to profitability and eventual IPO. COULD BE...
"...the US devolves into a series of coalition governments in future years."
I think that would be evolves, rather than devolves ... the 2 party system is a pox on U.S. politics.
War Horse? SMFH.
I pretty much agree with the economic predictions, except for the inflation issues. That means I disagree with the overall economic prediction. Inflation figures are manipulated for political gain. The consumers know that the government lies. I don't believe that the currencies will be that stable. The French will blow their noses in the general direction of the British.
I believe that there will be shortages of basic necessities. There will be episodes of panic buying, if not looting. And finally, the Fed will declare at least one bank holiday, after the election. It will be a busy year. Traders will hold on to their shorts.
http://georgesblogforum.wordpress.com/?s=The+Daily+Climb
I predict I will be gardening like a fevered dervish in the spring.
In February I put out brocolli sprouts and in March I plant potatoes--Pontiac Red. Raleigh area.
Can't wait.
I think it's high time that anyone publishing any predictions (incluidng the banks, the FED and governments) should be obliged to pay at least a $10 fee per prediction. (Higher fees if you are a corporation etc) At the end of the year some prizes can go to those that hit the nail on the head and the rest can go to buying houses for the homeless.
Furthermore, someone should come up with a standard format for predictions which will allow for comparison and evaluation at year end.
My prediction is that while the ability of people to borrow has been pretty much exhausted, the ability of governments and central banks to "print" solutions still has some way to go. This will give the impression that governments have arrested the slide and may lead to gold getting a similar hammering to the one we saw recently. Good news for those that want to buy.
I promise to send my $10 donation to a charity within 7 days.
I thought Lloyd's of London already does that?
Oh, sorry, you mean CDS's.
Great to hear that everything will be hunky-dory here in the UK.
Not exactly ... polar ice melt will literally leave the City of London under-water, the ultimate in debt repudiation. Britons in other, un-flooded parts of the realm will rejoice.
The Australian economic decline will be worse than 90USD exchange rate reflects when the carbon tax is implemented on top of reduced global demand for our resource exports and a housing bubble 'pop' to top it all off. 0.70USD more realistic as a low.
We experience our first ever assasination of a prime minister as a result of the socialist madness being forced upon us. It is done with a kitchen fork because all guns, pocket knives and anything else you can hurt yourself with have been banned. (Harold Holt doesn't count ... rumor has it he was offed by you guys for having the audacity to demand unfettered access to our 'area 51' at Pine Gap)
Full (propogandised of course) disclosure of past / current alien contact to try and distract / unite the globe
Ron Paul wins the nomination and the Presidential election and we are all saved :-)
My feeling is that the Labor Party may stall on introducing the carbon tax when it realises that an economic downturn is leading to an even greater downturn in their chances for re-election. The Labor Party does not understand economics but it sure does understand politics.
In any case I do not see the dollar falling below 88c.
I hope you are right. Humility is not a strong suit of politicians though. A low dollar is good for us so any external pressure will be accomodated and welcomed to get it as low as possible. High dollar is good for international internet shopping with your fiat while a low dollar is great for my 100% PM SMSF.... 2 bob each way.
Strong AUD helps average folks the most since it makes everything we buy (from China and Japan) a little cheaper, not to mention energy imports.
Precious few exports besides mine output and agricultural stuff which does suffer some...a bit of asymmetry in what is good for who. Ag prices are likely to stay high enough farmers can remain profitable even with a high dollar.
I suspect the burst of the housing bubble comes this year and that's going to sting something fierce. .70 on the AUD sounds reasonable to me but it could go a good bit lower in a perfect storm kind of situation.
I don't know what's up in Sydney, Brisbane, Melbourne and the like, but Mom and Pop operations in regional towns like Geraldton and Whyalla are dropping like flies already. Lots of empty storefronts in view.
Whyalla is going dry up and get blown into the Spencer Gulf if OneSteel kicks the bucket. And they might. They've fought for profitability even in the good years. Without special concessions on the ore coming out of Iron Duke they'd be dead already.
Oh...and Aussie banks are not the pure primadonnas they make themselves out to be. They won't escape and Australians will get plenty of experience feeding banksters their children's money.
The biggest industry in Aus is TOURISM and that is helped by the lower AUD. Second biggest is MINING and that is helped/causes a high AUD. The Lucky Country either way.
A 100% PM for SMSF is definitely my kind of recipe. Anything else is a blatant disregard for the future.
By LA beating Boston, you must mean the Paper Clips, and not the Lakers.
And having "no significant legislation" coming out of Congre$$ is a blessing to the American people.
Here here. A do nothing Congress is a good Congress.
Sadly, they seem able to unite for any legislation imposing restrictions on citizens.
<<-Silas Kiplagat will set a new world record for the 1500-meter race at the Summer Olympics in London. The time will be 3:33:22.>>
Good start!!!
That'll take some doing. The world record stands at 3:26.00 by El Guerrouj
No record. Right. What do you think of the winner and the time? Close?