Predictions for 2011....

First though, please refer back to my Blog of 12/31/09 entitled 'Some Random Predictions' where I set out my Predictions for 2010. As you will see, I have added some commentary.



I had not viewed this Blog since written so was a little concerned about its accuracy but on balance found that it had been quite accurate.



Let's hope I can do as well for 2011.



Here Goes:





Politics

• Elections at the Federal and Ontario levels will see Harper victorious while the Provincial Libs will be decimated by the Hudak Progressive Conservatives. Harper, although victorious, will fall slightly short of his long sought majority and I fully expect the national election will take place this Spring.


• In the USA, the Republicans will launch their campaign to unseat President Obama in 2012. I predict that Mitt Romney will come out of 2011 in the lead (he should have been their Leader in 2008). The Tea Party will continue to be the King Makers.


• I will go out on a limb and predict that Britain will be forced into another General Election and if so, the Tories will emerge with a working majority.


• Berlusconi will cease to be Prime Minister of Italy - at last

Economy

• The US$ will continue to decline due to their horrendous debt.


• The Canadian $ will stay above Par.


• The Canadian Economy will out perform the US.


• The European Contagion will continue to spread throughout that Continent and this coming year it will envelope the US.. (i.e. credit ratings will continue to fall)


• Interest rates will finally begin to rise for instance, here in North America, 5 year mortgage rates will climb to 5 - 6 %.


• Oil will average $100 a barrel and more.


• Gold / Silver / Copper will continue to outperform and will reach record levels.


• China will continue to Outpace the Pack which will insure that it will sooner, rather than later, succeed the US as the world's ultimate power.


• Over Legislation / Regulation will finally begin to slow - sadly it will take more time to see it begin to reverse.


• The numbers of Civil Servants and their Salaries will begin their descent.


• Social Welfare Programs will stall and then they too will begin their decline.

World Affairs

• Terrorism will continue with softer targets (read crowds).


• Haiti will continue to suffer as will Africa.


• Afghanistan will more or less stalemate as long as NATO (read USA) remains committed as they will for the coming year.


• Last year I suggested that Iran would be the big story of 2010 and it will continue to be so this coming year. Time has been bought by successful efforts to infect their computer systems. Hopefully, this time will allow for a Regime Change but I do not see that happening in 2011.


• The Greater Story this year could well be the Koreas. A Nut Bar leads the North and the South is tiring of continuing concessions. It is a powder keg set to go off. As in the case of Iran - steps need to be taken by the West (read USA) to block further Nuclear Development on the part of both rouge nations.


• Russia will continue to descend into Dictatorship with Putin continuing to perform the role of Dictator.


• Airport / Border Security will continue to thicken in the face of loss of Freedom / Privacy.


• Democracies will be upstaged Communist / Dictatorship Governments.


• The backlash against Immigration will see the Right in Europe grow in strength as will their laws designed to neutralize the Muslim effect.


• Persecution against both Christians and Jews will accelerate and both their Religions will continue to be under attack throughout the world.

Generally Speaking

This coming year will be a most difficult one. The chickens are coming home to roost and precious few are ready to deal with the consequences. Greater Civil Unrest Can Be Expected.

As I see it...

'Galagher'

Investmentisms...for 2011

With all the year end prognostications I got to thinking - what would happen if a woman news anchor (Sandy), with no background in business - attempted to interview a seasoned financial guru (Mr. Dow Jones)?



Maybe it would go something like this:



I am pleased this evening to have as our guest Mr. Dow Jones who will share with us all his views on the economy for the coming year.



Mr. Jones thank you so much for joining us.



You are most welcome.



Let me begin by asking you generally what you see in store for us in 2011?



Well as a renowned Bear you can just imagine what I have to say so you won't be surprised if I tell you that I believe that currently we have an Ovobody Market.

Please proceed.

I am also a well known Contrarian so don't expect my comments to follow the crowd.

Be assured Mr. Jones that I do not harbour any such expectations. Now what precisely can our audience expect for next year in the markets?

We are going to see much of what has taken place in 2010 that is to say: flashing, one night stands, swaps and stripping.


Well Mr. Jones we are in polite society so I would ask you to please keep your comments civil.


Eh? There are certain things that as a Contrarian I am specifically looking for and that is such things as a Hot Waitress or Fools in the Shower.

I strongly suggest Mr. Jones that you keep your private life out of today's conversation. Now let's get back to our topic - what in particular will need to happen to see the markets advance in 2011?

Treponomics.

Treponomics?

Correct.

Will that tell us we are on the right path.

Yes and No.

Yes and No?

Correct.

Would you please expand on that.

Gladly. Yes Treponomics is the answer but it is a very slow process so it could take a number of years before we can gauge its success.

So we won't know for sure if it is working in 2011

Precisely not. But it must get started in 2011 to be effective so we will begin eventually to see improved EBITDA.

EBITDA?

Exactly.

Okay let me come at it from a different angle. Is there anything that could happen in 2011 that would tell you that things are likely to improve?

Of course there is - one could look for a Jennifer Lopez.

A Jennifer Lopez? What pray tell is that.

A nice Round Bottom of course.

Mr. Jones I will not warn you again.

Sandy I am beginning to see that you have not done sufficient Concepting.

There is no need to insult me Dow, I am doing my best, so let's just try to get through this - we have but a couple of minutes left. We hear alot about Index Trading do you have any favourites?

Two of my favourites are Paris Hilton and Lipstick.

Why am I not surprised. Any favourite Bonds?

I guess I would have to say the Chasity Bond.

Well given your other comments that does come as a surprise to me. Is there anything the ordinary investor can do to grown his or her Portfolio?



I would suggest a combination of Arbitrage and Forex. The financial world is getting smaller, so I would recommend to your viewing audience that these types of investments would be to their overall benefit.



Arbitrage and Forex?



Yes.



Are they listed on the Stock Markets.



Quite the sense of humour you have Sandy. In all seriousness though - for 2011 many businesses will have to adopt detailed Scalping Strategies.



Scalping Strategies? Like the Indians?



You are indeed refreshing Sandy but I do hope there are not too many Aboriginal Investors out there in your television audience.



Oh my. Let's conclude our interview with one final question Dow. Um, if there is one piece of advice you can leave our audience with - what would that be?



Buy low - Sell high.



Well that is certainly something we can all understand. Thank you so much. And perhaps Dow you could leave me your cell phone number in case I have any follow-up questions.



As I see it...



'Galagher'