Meaning this is not about Poker.
Let us start by stipulating that if I were really this smart, I would be rich by now - and I am not.
I am just a simple amateur observer.
My economic intuition and $2 will get you a cup of coffee - if it is worth even that much.
You have been fair warned.
Really this is about either making myself look ingeniously foresighted or really stupid.
Either way - it is fun to make predictions you have no control over and see if you were right.
I predicted San Diego real estate prices would crash up to 50% - at least two years before that actually occurred. It just made sense. So one brownie point for me!
I, however, did not foresee the stock market crashing 50%. That was news to me.
Now -- once the stock market did crash in September/October 2008 - later around Dow 8500 - I predicted it would break the current bottom of 7500 and hit 6500 . It dipped below 6500 but closed around 6550'ish. So I say good enough - another brownie point for me!
In March 2008 I predicted the Dow would eventually hit a new bottom at 5000.
Ouch!
Instead the Dow rallied to over 10,000.
Subtract one brownie point.
However - believe me - I am long term correct. The Dow will see a new bottom below 5000.
Think about it - would I risk the only brownie point I have left. lol. Okay...stupid question.
But still...I think by end of 2010 the Dow will sit below 5000 and the S&P below 500.
I've been pessimistic about our economy for a while. I want to update my predictions.
So here we go...let's roll the dice and see if papa gets a new pair of shoes!
Jays Predictions
1. Stock Market crash of 50% starting between October 2009 (now) and the middle of December.
I really expected a 10% correction by now - but I think early November may be when the crash starts. Hello Recovering Dollar!! -- bye bye Equities! :-(
We're talking 5000 Dow and 500 S&P by mid to late 2010.
2. San Diego Residential Real Estate crashes at least 30% more by Mid-2010.
Avg home price in San Diego hits around $175K.
(currently around $250K I think)
3. Silver and Gold crash with market but then shoot up in value.
Opportunity to buy around late November to late December.
Precious metals will certainly go back up because of a flight to security.
Silver will hit a low of around $12.
Silver will then recover and hit at least a high of $30 by June 2010. Gold will hit the high of at least $2000.
I hate to be the pessimist but sometimes reality requires it.
This is a classic bear market rally.
I would not be surprised if by the end of 2010 the Dow sits below 4000.
BTW
This pessimistic point of view is one of my strong reasons to grinding online poker. Grinding online poker may be the only job I can find if my predictions come true. NOW is the time to polish my poker skills - not when in the middle of a economic crisis.
I've contemplated for almost a year what I can do to prepare for what is yet to come - and really there is not much you can do without over- reacting. I am done with the days of stocking up food and ammo. The best skill set to have is the ability to react with a calm peaceful disposition - not one of fear. Working on that one.
Change is the name of the game for a while. I say you need to learn to bend with the wind or else you'll break your branches.
But reality is reality. Painting a rosy picture doesn't change the facts.
Optimism is very high these days in the news. We're supposedly out of the recession and into economic recovery.
Blah blah blah. Talk to me in June 2010. I'll happily admit I was wrong.
But....I want TWO brownie points if I am right!
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