Jim Cramer, who in my eyes has always been irrationally bullish, is finally quiet and admitting we're going to see 70s stagflation this year (recession plus inflation). He's investing in gold stocks now, and suggests everyone have gold this year.
http://www.thestreet.com/_dm/video/index.html?clipId=10396686&channel=Cramer+On+Demand&cm_ven=&cm_cat=&cm_ite=#10396686
Wednesday, January 2, 2008
Well, 2007 is in the rear view mirror and now it's time to see how my advice stacked up from last year, as well as offer economic predictions for this year.
Back in August I suggested moving completely out of US stocks, and into gold, foreign commodities, with broader forays into foreign stocks. That turned out really well. Gold had its best year since 1979, oil just broke through $100 a barrel, and most commodities hit 10-30 year highs. Comparing the 26 major stock markets, the US did the worst of all, due in no small part to the declining dollar.
All told, since August my portfolio rose approximate 23%, although it was higher in November as there was a slight pullback in December. So my predictions about the US economy were largely correct.
The one area that did really well that I did not suggest was technology stocks. While financials, housing, and other sectors declined, stocks like Apple, Google, and various Silicon Valley companies had excellent years.
For this year, I think all markets will be hit with downturns from the obvious recession America acknowledges in 2008. Already, the major underpinnings of the economy (housing, car and truck sales, consumer spending, and factory output) are all already in recession. As such, for the first time I'm suggesting shorting the US market. I think we'll see the Dow hitting 11500 (it's around 13000 today).
I think gold will hit $950, with the possibility of $1150. I also like platinum, and of course, continuing with a broad swath of commodities like wheat and oil, although I think we'll see consumption drop due to a worldwide effect from American recession. Safe havens like precious metals will be still rise.
One major trend that will continue will be foreign companies buying up American assets at distressed prices. Good for the CEOs who will get their bonuses, bad for America as yet more assets leave, diminishing our economic output. Regardless, I still think most sectors will see drops, including retail, financial, automotive, housing, and transportation.
I think careful picking of startups in energy and technology will pay off. Solar companies, fuel alternative companies, and consumer gadgets should still offer very good returns.
If anyone needs specific stocks or charts that I invested in, you can PM me as some have done, or post in this thread.
I'm off to the Consumer Electronics Show in Las Vegas next week to get a sense of the market. I'll be taking pictures of products that I find interesting.
Back in August I suggested moving completely out of US stocks, and into gold, foreign commodities, with broader forays into foreign stocks. That turned out really well. Gold had its best year since 1979, oil just broke through $100 a barrel, and most commodities hit 10-30 year highs. Comparing the 26 major stock markets, the US did the worst of all, due in no small part to the declining dollar.
All told, since August my portfolio rose approximate 23%, although it was higher in November as there was a slight pullback in December. So my predictions about the US economy were largely correct.
The one area that did really well that I did not suggest was technology stocks. While financials, housing, and other sectors declined, stocks like Apple, Google, and various Silicon Valley companies had excellent years.
For this year, I think all markets will be hit with downturns from the obvious recession America acknowledges in 2008. Already, the major underpinnings of the economy (housing, car and truck sales, consumer spending, and factory output) are all already in recession. As such, for the first time I'm suggesting shorting the US market. I think we'll see the Dow hitting 11500 (it's around 13000 today).
I think gold will hit $950, with the possibility of $1150. I also like platinum, and of course, continuing with a broad swath of commodities like wheat and oil, although I think we'll see consumption drop due to a worldwide effect from American recession. Safe havens like precious metals will be still rise.
One major trend that will continue will be foreign companies buying up American assets at distressed prices. Good for the CEOs who will get their bonuses, bad for America as yet more assets leave, diminishing our economic output. Regardless, I still think most sectors will see drops, including retail, financial, automotive, housing, and transportation.
I think careful picking of startups in energy and technology will pay off. Solar companies, fuel alternative companies, and consumer gadgets should still offer very good returns.
If anyone needs specific stocks or charts that I invested in, you can PM me as some have done, or post in this thread.
I'm off to the Consumer Electronics Show in Las Vegas next week to get a sense of the market. I'll be taking pictures of products that I find interesting.
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