The Year of the Water Snake: A year of investing dangerously
Posted by Charles II on January 2, 2013
My last year’s predictions for the markets were not particularly good:
I see the same two paths open before us that there were last year. On one path, the Chinese allow their currency to float and the consumer economy to take root. The Germans stop trying to punish southern Europe. The US gets the dead hand of the Republicans off the economy and does something for underwater homeowners. Japan bites the bullet and goes solar. Under this scenario, a true recovery begins, and a true bull market takes hold. On the other path, the political system continues its now-epic FAIL, recovery turns into recession, and the bull market is pushed off for years.In the formerlatter case, making money in the market is all but impossible for the small investor. In the latterformer case, everything does well, but especially industrials, basic materials, energy, staples, and services
So, which is the Year of the Water Dragon? If you believe in Chinese astrology, it’s a good year to make money. If you believe in the stupidity of politicians, things do not look good.
I know which of the two I believe in.
We had extremely stupid politicians, yet the markets rose thanks to a Fed that has bathed asset prices in an unprecedented geyser of money. The US turned in a middling performance, while Asia did extremely well despite having politicians about as stupid. Brazilian large cap stocks underperformed.
Now we move to the Year of the Water Snake.
So, here’s an astrologer, Sophia Angelique, aka Tessa Schlesinger, on what the Water Snake will bring:
In general, snakes are a tricky lot. If it wants to move forward, its body undulates and it’s not easy to tell which direction it is going to go in. That’s the same with the 2013 year. It will seem to go in one direction, and then, very unexpectedly, it will veer in completely another direction. That’s why it will be so difficult to plan for. Those that do best this year are the ones that have a natural ability to move at the pace of the snake and who are able to navigate tricky waters. The example is steering a ship in a storm with loads of mist, unable to see, and having to use other senses – like radar, sound, computer equipment, etc. to get through safely. It’s a year when it’s best to work with others and to talk things over before starting something new. It’s a year when quick maneuvers are going to be needed in order to avoid unexpected obstacles.
Considering how well the macro approach I use has done in predicting the market, you might as well rely on astrologers. And considering that John Boehner and Eric Cantor are in charge of the House of Representatives, it is indeed a good bet that those two snakes are going to go in highly unpredictable directions.
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