Anybody Care to Predict?

1echidna

Can't believe a word professional forecasters (usually with vested interests) say and have found what seems to be better judgement here. I am interested in what would be the best allocation of my assets as between property, cash savings and equity or bond based investments. To do this I am interested in forecasts for the next two years of house prices, inflation, interest rate and the FTSE 100. For what it is worth my guesses are:

2009
House Prices -20%
Inflation 5%
Interest Rate 3% year end
FTSE 100 5000 year end

2010
House Prices 0%
Inflation 10%
Interest Rate 5% year end
FTSE 100 5800 year end

I am particularly interested to hear the views of those who think the brown stuff is really going to hit the fan in 2009, although all views welcome of course.

Cleaver

I would pretty much agree with all the OP predictions.

ad9898_3

There is no way inflation could be at 10% and IR at 5%, your FTSE predictions look good, as does your 2009 house price, although 2010 i still see falls.

If inflation was at 10% in 2010 the housing market would be heading back to the early '90's price wise, imagine interest rates at 10% with the amount of leverage out there.:eek:

1echidna

ad9898 wrote: »

There is no way inflation could be at 10% and IR at 5%, your FTSE predictions look good, as does your 2009 house price, although 2010 i still see falls.

If inflation was at 10% in 2010 the housing market would be heading back to the early '90's price wise, imagine interest rates at 10% with the amount of leverage out there.:eek:

I was trying to think of what might happen with the printing money scenario and the tearing up of rule books. Savers being sacrificed to keep hard working families in jobs and paying their mortgages mortgages. If inflation is high, and perhaps heading higher money, by hook or by crook will find refuge in property, especially if there is wage inflation.

WTF?_2

This will eventually provoke strong inflation with a tangible risk of hyperinflation.

In any case, cash will be stolen from everyone in sight to bail out the government and the other chronic debtors. Inflation is the 'best' stealth tax that there is. It's not immediately obvious as a tax but it allows the government to take wealth from absolutely everyone who holds a positive balance of Sterling.

Japan got away with it because the money they printed got 'exported' through the carry trade - whose unwinding is now propelling the Yen upwards and causing no end of problems in Japan. Where are we going to export our inflation to? In addition, the unique position of the US dollar does allow them to export their inflation so we'll end up with a dose of that on top of our own.


As to where it ultimately ends after that - if there is hyperinflation we'll see an all out implosion of the economy. Goodness knows how bad that will be. Maybe we could look to Argentina for a clue.

[Deleted User]

1echidna wrote: »

Can't believe a word professional forecasters (usually with vested interests) say and have found what seems to be better judgement here. I am interested in what would be the best allocation of my assets as between property, cash savings and equity or bond based investments. To do this I am interested in forecasts for the next two years of house prices, inflation, interest rate and the FTSE 100. For what it is worth my guesses are:

2009
House Prices -20%
Inflation 5%
Interest Rate 3% year end
FTSE 100 5000 year end

2010
House Prices 0%
Inflation 10%
Interest Rate 5% year end
FTSE 100 5800 year end

I am particularly interested to hear the views of those who think the brown stuff is really going to hit the fan in 2009, although all views welcome of course.

2009 h/prices -15% inflation 2%,interest rates 1.5%,ftse 4750
2010 ^^^^^^level ^^^^ 1.5% ^^^^^^ 2.5% ^^ 5350

1echidna

woodbine wrote: »

2009 h/prices -15% inflation 2%,interest rates 1.5%,ftse 4750
2010 ^^^^^^level ^^^^ 1.5% ^^^^^^ 2.5% ^^ 5350

Thanks. I guess rather more optimistic than me and even more optimistic than !!!!!!? about the effect of the brown stuff and the fan.

tradetime

Nothing like a good holiday to clear the head I see optimism hasn't hit the board,. mind you, what's to be optimistic about I guess. Afraid I can't help on that one, it's gonna be a bumpy ride.

2009
House Prices -15%
Inflation <2% year end
Interest Rate 1% year end
FTSE 100 3000 year end

2010
House Prices -5%
Inflation 4% year end
Interest Rate 3% year end
FTSE 100 3400 year end

purch

2009(end)

House Prices -23%
Inflation -1.5%
BOE Base Rate 1%
FTSE 100 4725

2010(end)

House Prices -3%
Inflation 0.5%
BOE Base Rate 1%
FTSE 100 4850

ps2659

I am particularly interested to hear the views of those who think the brown stuff is really going to hit the fan in 2009, although all views welcome of course.[/quote]


What brown stuff do you mean Gordon ?

dad-of-4

i cant predict any of the above,

but i do believe the we will turn the corner of all the mess, within a day or two of Maggie's portrait being hung on the wall of number 10 by Gordon brown

the reason it wont happen immediately is because at first his arrogance will only allow him to think it. but her hanging their looking down on him will break him and with a tear in his eye of self realization he will ask out loud.

Maggie....
Please tell me,.. what should i do.