While 2013 certainly did not turn out as we initially envisioned, 2014 is likely to resolve some of the quantitative easing euphoria of the past 5 years.
1) Beginning of a global stock market correction. As readers may be aware, global markets have a valuation of about $63.4 trillion as of November 12, 2013. Based on the charts, it is my assertion that we will see the markets drop below $51 trillion by the end of 2014.
A forecast for the S&P 500 suggests a minimum correction of 25% to the 1450 range. Based on current trends, April could be the time-frame the larger correction begins.
2) A spike in gold bullion prices is likely after another month or two of consolidation early in 2014. As the authorities begin to lose control of the gold suppression system maintained by massive short positions of the bullion banks to support the status quo fractional reserve fiat currency system prices will rise quickly.
My year end gold target is $1500.
3) Bond market yields among peripheral countries in Europe rise again. Spain, Italy and Portugal look particularly vulnerable. French yields will rise substantially. Even Germany may look at higher rates by the very end of 2014.
4) The Euro finally splinters in 2014. Greece is the prime candidate from an insolvency and Euro exit viewpoint, while Germany may decide it can't continue to bailout everyone else, including, at some point, France. Several other countries are also candidates including Belgium, Spain, Slovenia, Portugal and Italy. A full Eurozone breakup is likely by 2015 or 2016.
5) As the European bond market stumbles, money flows out of commodities with crude oil (Brent) dropping below $99, and WTIC falling to $78 barring any substantial Middle East disruptions.
Copper looks vulnerable falling to $3.00 from current levels.
If the $3.00 range is lost, well, that would be bad.
6) The Japanese bond market remains one of my biggest areas of concern given the extreme level of debt and 2012's experience with the first wave of difficulty in selling bonds, combined with the collapse in Yen buying power from Abe's massive money printing campaign.
Yields should continue to slowly rise but will have a large impact on government deficits as interest cost balloon.
1) Beginning of a global stock market correction. As readers may be aware, global markets have a valuation of about $63.4 trillion as of November 12, 2013. Based on the charts, it is my assertion that we will see the markets drop below $51 trillion by the end of 2014.
A forecast for the S&P 500 suggests a minimum correction of 25% to the 1450 range. Based on current trends, April could be the time-frame the larger correction begins.
2) A spike in gold bullion prices is likely after another month or two of consolidation early in 2014. As the authorities begin to lose control of the gold suppression system maintained by massive short positions of the bullion banks to support the status quo fractional reserve fiat currency system prices will rise quickly.
My year end gold target is $1500.
3) Bond market yields among peripheral countries in Europe rise again. Spain, Italy and Portugal look particularly vulnerable. French yields will rise substantially. Even Germany may look at higher rates by the very end of 2014.
4) The Euro finally splinters in 2014. Greece is the prime candidate from an insolvency and Euro exit viewpoint, while Germany may decide it can't continue to bailout everyone else, including, at some point, France. Several other countries are also candidates including Belgium, Spain, Slovenia, Portugal and Italy. A full Eurozone breakup is likely by 2015 or 2016.
5) As the European bond market stumbles, money flows out of commodities with crude oil (Brent) dropping below $99, and WTIC falling to $78 barring any substantial Middle East disruptions.
Copper looks vulnerable falling to $3.00 from current levels.
If the $3.00 range is lost, well, that would be bad.
6) The Japanese bond market remains one of my biggest areas of concern given the extreme level of debt and 2012's experience with the first wave of difficulty in selling bonds, combined with the collapse in Yen buying power from Abe's massive money printing campaign.
Yields should continue to slowly rise but will have a large impact on government deficits as interest cost balloon.
I will add my prediction, we can list it as number 7. I would have hoped that your 6 predictions would be somewhat reasonable and probable, but you mess this one up big time. So, here is my prediction for 2014.
ReplyDelete7) None of the above 6 predictions have even a remotest chance of happening, and will not happen.
Thanks for that vote of confidence!
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