WSJ: 2018: You Read It Here First

https://www.wsj.com/articles/2018-you-read-it-here-first-1513538788

It’s that time again: Get ready for lists of year-end predictions. My prediction? You hate them. Me too. The old game on Wall Street and Silicon Valley is for members of the bloviating class to polish their crystal balls and tout their brilliance by predicting how the next 12 months will unfold.

The worst predictors are those who hedge. They produce lists of worthless predictions that can be considered correct no matter what happens. You know them: “Unless there are exogenous economic shocks, stocks will rise next year.” Or, “Outside of OPEC intervention or tight supplies, oil prices are headed down.” Then a year later, these prognosticators will claim their predictions are uncannily correct, while they roll out new hedged mush for the next year.

I want in on this game too. Here are mine:

1. Interest rates will go up in 2018. I’m already 1-0.
2. The stock market will underperform 2017’s returns. See what I did there? Stocks are up around 24% this year. Even if they are up again by 23.99%, I’m right.
3. Tesla will miss production forecasts again. This is easy. Put another correct prediction in the book for me.
4. Bitcoin appreciation will slow. The cryptocurrency is up around 1,700% this year. Again in 2018? Store canned goods if it does. Cryptobulls claim bitcoin is a store of value, and to handle the world economy, it must be valued in the trillions. That’s a leap of faith wider than the Grand Canyon. Currencies were once backed by gold but now derive value from faith in governments and their ability to tax citizens and boost the economy. This became evident during the 2009 financial crisis, when bank bailouts in dollars didn’t crater the currency. Remember Zimbabwe’s $100 trillion note? I’ve calculated bitcoin being worth no more than a few hundred dollars. I’ll stick with that.
5. No, 2018 will not be the year of augmented reality. Techies salivate over the facial-recognition sensors in the iPhone X. But animoji karaoke is just not that big a deal. Augmented reality will come of age when I can go to Gettysburg, look through glasses toward Cemetery Ridge, and watch Pickett’s Charge play out in real time. Wake me when that happens.
6. Donald Trump and Vladimir Putin will still be in power.The Russian will rig the system, and the Russia investigation won’t stop the Trump Train© from rolling over the resistance.
7. The best-performing market in 2018 will be out of Africa. No real insight here. Some downtrodden market, most likely in sub-Saharan Africa, will come out of its slumber and double in value. Maybe Zimbabwe.
8. Net-neutrality regulations will be repealed, customers will be happy, and the internet won’t collapse. George Orwell would chuckle at neutrality proponents who doublethink a free and open internet through regulations. In reality, net neutrality comes free with competition and without regulators. I hope the same energy can be instead harnessed promoting fiber and 5G and any other competition-expanding technologies. As soon as the regulations go away, watch providers offer new discounted plans. Free internet with Amazon Prime?
9. China will experience financial indigestion. The International Monetary Fund is nervous about China. So am I. Property prices are inflated. Debt has become a bad drug. I’ve heard of consumer-goods companies that don’t pay their suppliers for a year, but then offer them financing so they can get cash. They then sell that supplier debt to the public—the same customers that buy the consumer goods. What could go wrong? Even a small glitch becomes a disaster.
10. The U.S. economy will do better than expected in 2018. Bit of a low hurdle here. After years of Obama -burdened 2% growth, a combo of regulatory reform and corporate tax cuts will unleash the animal spirits. I can see GDP growth over 3% each quarter in 2018, perhaps even surpassing the naysayer 4% barrier. And it’s exactly why interest rates will rise—see prediction No. 1.
11. The first disease will be cured with Crispr technology. Gene editing is very cool, and Crispr tools will reshape health care over time. But all I need is one disease to be cured. Heck, I’ll settle for canine flatulence or even colorblindness.
12. Two self-driving cars will collide with each other. It’s inevitable. Why not predict it?

    There you have it. I’m already batting .500 and it’s still 2017.