2018 Economic Surprises

With all the Wall Street Guru’s putting out their potential surprises for 2018, I am thinking why not do this myself, there is enough craziness in the mix to allow a little more mixing to provide some outside the box probabilities.

We have discussed at length the fact the we have seen 17 years where Washington has tried multiple attempts to provide solid real economic growth and yet all the results are just face saving bluster created out of artificial money.

These surprises are kind of built around a premise that no one would agree with them so in a crazy time they have a decent probability of occurring.

  1. In a 2018 + vein, over the next three years look for fed fund rates to trade over 30 year bond rates by at lease a point.
  2. This is the beginning of the end of the dominating influence of Saudi Arabia in world events. It is a desert, people.
  3. With that said, look for oil to start a 3 year slide to under $ 10 a barrel in 2020.  The bounce from the 2016 lows has been a god send for them but it is history.
  4. Brexit will be rescinded one way or another.
  5. The Euro has the potential to scream higher with Britain in place and oil prices dropping.
  6. The Yen is at the core of the world stupidity bubble, may even replace the Bernanke QE stupidity bubble.  What will Abe do with all this crap they own?  You will probably see the yen scream upwards as this unwinds.
  7. The dollar will plummet as the US 2017 Corporate Tax Change based inventory buildup unwinds and trade issues multiply and US status deteriorates.
  8. Stocks will run into a headwind as all this rolls out.  I would not attempt to talk about how low is low.
  9. And lastly, Gold by default will go back to haven status, heading to new all time highs over the next three years.

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