Samurai Predictions And Resolutions For 2010
It’s amazing how quickly time goes by. Usually, I get nostalgic this time of year, reminiscing about all the memories over the last 12 months. Not this year. Let us remember that we went through an economic blitzkrieg in 2009, and I am so glad it’s over!
The one thing I am really hopeful for is a rebound in employment. Over the past 3 months, I’ve encountered so many positive job data points in my industry from friends and acquaintances on the job front, I’m absolutely hopeful those who are seeking jobs, or better opportunities will find them in 2010. Companies always over fire during downturns, and therefore have to scramble to rehire in this upturn. Below are five more predictions you don’t even have to think won’t come true!
FIVE PREDICTIONS THAT MOST CERTAINLY WILL COME TRUE
1) Inflation remains tame and therefore interest rates remain low. There’s really only one figure I check frequently, and that’s the US 10-year government treasury yield. The 10-year yield tells us so much: sentiment of the bond and stock market, inflation outlook, fear or greed, mortgage rate direction, and what foreigner’s are getting in return for funding our debt. The 10-yr yield will not breach 5% this year, and credit will therefore continue to be very cheap.
2) The US dollar strengthens. Literally nobody agreed with the post “A Weak Dollar Doesn’t Matter Folks!” and that’s fine by me. Now you know why a weak dollar doesn’t matter, because I’m bullish on the dollar, and the weakness is only temporary! Look for the USD to strengthen against the Euro and the Yen in particular. Given the Yen will weaken to 95-100, I’m bullish on Japan as a macro trade as well. And no, I’m not biased because of the word Samurai!
3) The US markets do not double dip. Instead, they continue to rebound. Specifically, look for the S&P 500 to rise 13% to 1,265 and the Dow to 12,000. There is still hundreds of billions of dollars in money market funds which have missed this rally, and 2010 is when liquidity rushes into the markets. You don’t have to be too cute in this market recovery, since it is largely liquidity driven.
4) The most hyped IPO of the year will be Facebook, creating several new billionaires, and hundreds of new multi-millionaires in the San Francisco Bay Area. SF-based Twitter doesn’t go public, but instead, gets bought out with the richly valued stock of Facebook or another media titan. There’s no doubt once Facebook goes public, they will go on a buying spree, enriching even more innovative companies around the Bay Area. SF-based LinkedIn is the dark horse, with a current perceived market valuation of $1 billion. Seems pretty paltry compared to FB, and so I think they wait another year to ramp up more subscribers until analysts value the company closer to $2-3 billion. SF property prices continue ticking higher as new wealth seeks multi-million dollar homes, and dollars fall from the sky!
5) The Samurai Fund outperforms the S&P 500 index by 300 basis points (3%)! The 15+ entries so far are wonderfully unique, and everybody has done a great job in putting their synopsis together. With controlled randomness in picking names, each team member has a critical roll in keeping abreast of their names and providing opinions on whether to add to their positions or reduce. Due to the outperformance, the Samurai Fund gets noticed by finance sites we never imagined would care about our tiny corner of the universe, and the team achieves fame!
GOALS FOR 2010
1) Make a million bucks. Yes, it’s a lofty goal that I’ve failed every year, but that doesn’t stop me from trying! The income can come from private equity investments, stock market, salary, rental income, and other, such as winning the World Series of Poker! Setting lofty goals forces the mind to constantly think of new ways of surviving, while motivating me to work hard everyday.
2) Win a tennis tournament. I got beat by a 60 year old (!), ex Davis cup player in the semi-finals of a tournament this year due to a right calf cramp. If I beat him, I would have won the tournament. Disappointing, because my opponent was about to keel over at 5-5 in the 2nd set and give up. It’s not good enough to have skill, and mental fortitude if your body can’t hold up. So really, winning the tennis tournament is a physical health resolution of eating right, working out, and staying injury free.
3) Meet 36 new people, or 3 every month. It’s really a joy meeting new people, be it in person or online and hear their story. We can learn so much from others, no matter their background or age. I will keep a log of who I meet, and write 3 things I’ve learned and admire about each new person. The solution to “If I knew then, what I know now” is to simply seek people who’ve been where you are heading already and listen to them!
4) Try and always see the good in others. In “Everything Is Rational, The Answer To All Things Irrational”, I highlight a more peaceful way of thinking that soothes my raging soul. It’s important to stop taking slights/rejections personally, and just keep having fun. It’s very easy to be overly critical of others and act like a meanie, which is not the way I want to live my life. We shouldn’t try and impose our will on others. Avoid associating with “black clouds,” those people who are naturally pessimistic and grumpy by nature!
5) Stay consistent, but not obsessive with this site. Any publisher will tell you that producing consistent content over the long run is hard. This is why I really admire all of you who have started a website, no matter how big or small, as well as those who comment regularly! It’s also important not to get addicted to blogging to the detriment of family, friends, and work. From 7am-7pm on weekdays my personal e-mail and Twitter account will continue to be off.
Guest post submissions are always welcome. And even if they are declined, know that someone will accept it. You can always publish on your own site too, like I plan to do for one of my rejected submissions from 3 months ago (too controversial they said)! There are no subscriber, comments, revenue goals for the site. The only thing I wish for is progress, my one word definition of happiness.
6) Put an acoustic album together of 10 songs I can play, sing and record. I’ve had my Martin Acoustic D-16 guitar for 10 years now, and it is in perfect shape because I don’t practice enough! Current songs on the list include: Black Bird by Paul McCartney, Every Rose Has Its Thorn by Poison, Five String Serenade and Fade Into You by Mazzy Star, First Day of My Life by Bright Eyes, Nothing Left to Lose by Matt Kearney, More Than Words by Extreme. Need three more!
7) Learn to cook three delicious dishes for each meal of the day and put together a menu. Breakfast is easy. Lunch a little bit harder, and dinner the hardest. A resolution I talked with my wife about two years ago since she was so gung ho about cooking then. Unfortunately, the enthusiasm sputtered out, so I’m going to do it on my own, and hopefully inspire her to make her own menu.
8) Save at least 50% of my 2010 gross income and build the “Freedom Fund” to at least $200,000 by year end. You can consider the Freedom Fund as my net worth barometer. The traditional net worth calculation is an illusion. Cash and cash flow are the only things that matters!
Thanks everyone for coming to visit my small piece of cyberspace. It’s been extremely fun getting to know many of you. The mutual knowledge sharing has been fantastic. Please continue to challenge my thoughts until the blue fin tuna swims home, because without debate the mind will ossify. May the majority of your goals come true in 2010!
Happy New Year!
Readers, feel free to share one or two of your highest conviction predictions, or share why you don’t think any of my predictions will come true.
What’s the one goal you must achieve in 2010, more so than any other?
Keigu (Respectful Regards),
Financial Samurai – “Slicing Through Money’s Mysteries”