The 2017 HAMISH_MCTAVISH Predictions Thread

michaels

In theory the unexpected has already happened so predicting this year shoud be easier...

HAMISH_MCTAVISH wrote: »

The big global issues for the next few years will certainly include Brexit and Trump on an alarmingly regular basis - but this year may be too soon for either - It will take Trump some time to do any real damage and the worst excesses of Brexit may yet be avoided if May can negotiate a good deal around single market access.

So with the caveat that 2017 is likely to be less predictable than most years we'll give it a go anyway.

As for the predictions...

1. House prices will rise. Indices will range from +1 to +5%. This is a slower rate of growth than last year.
Looks like London prime will fall although obviously for non gdp buyers it is already much cheaper. Elsewhere don't know - is it driven by ripple from London prime or is perhaps anything outside the home counties its own market. Strangely in these areas although OO affordability seems better btl yields are much hgher.
minus 1% overall
2. FTB numbers will fall due to Brexit induced job market uncertainty and disposable income being squeezed by inflation.
Don't think so, btl tax will be a bigger factor

3. Inflation will rise significantly because of the Brexitary GBP devaluation - I expect a range between 1.5% and 3% for most of the year.
I suspect at least 3% by year end just from gbp deprciation, higher if commodity/oil rices also go up in usd.

4. The big falls in unemployment we've seen recently will slow and may even start to reverse - likewise the picture for real terms wage growth is much gloomier thanks to increasing inflation. Best guess is a slight rise in unemployment and falls in real terms wages.
Not sure, presumably uncertainty means less EU immigration and along with the minimum wage ths will do what was intended, push wages up at the bottom. So all things being equal slightly more wage growth but also less employment growth. 5.1% unemployment by year end

5. Interest rates will end the year at or below 1%.
Mostly agree although we will see US rates up 'sharply' and even now without the brexit vote the economic fundamentals woud be for the uk to start to follow. However I still think the UK wants to inflate away debt through nominal gdp increases as was done in 2012/13 so I din't see any move by the boe to raise rates due to 'imported inflation' so I suspect still at 0.25 by end of next year, outside 0.5%

6. House building will not increase at anywhere near the rates the government has promised or the country needs to alleviate the housing crisis. If the government does not reverse the punitive BTL taxes that act as a discouragement to investment it will fall.
Agree and agree and

7. Rents will continue to increase and reach another new record high.
'Recod high' is a bit disengenuous as positive price inflation means record high is the norm. Average rent to average income is likely to rise with restricted new btl supply althogh govt hb policy does impact.

8. The gap between London/SE and the rest of the UK will continue to close as it did in 2016.
Prime london yes, outer London and home counties not sure, Rest of country to remain flat.

9. Aberdeen house prices will continue to soften a bit as they have done over the last year. The falls in Aberdeen rents are already starting to ease and should level off towards year end.
No idea, Oil rices probaby still have an upper bound of 60-70 usd due to us shale so presumaby that eans uk offshore production continues to be run down.

10. Economic growth will slow with GDP under 2.0% for the year
Not certain, real economy seems strong and min wage puts money ito the pocket of those most likely to spend it, I think 2 to 2.5%

Politics:

11. If the government indicate a soft/sensible Brexit (staying in single market) and/or long term transitional deal is being targeted then the worst economic consequences of Brexit to the UK will largely be avoided. And a second Scottish Indyref will be off the table.
Needs another post / thread. I suspect 'interesting times'

12. If the government indicate a hard/chaotic Brexit is being pursued then the SNP will call for Scottish Indyref 2 - and win it.
Really? I still think the Scots would still vote to stay in UK but amit I am miles from any knowledge.

13. The UK Labour party will end the year with a different leader. (perhaps a bit of an outlier but we can live in hope!)
Doubtful, I suspect Labour will communicate its left wing policies better which are ones people tend to tell pollsters they support and see poll levels ncrease especially with Tory uncertainty/infighting

14. DAESH will continue trying to destabilise the West with additional terrorist attacks and attempting to start the race/religion war they so desperately want - aided and abetted by the European/UK right-wing groups that are the other side of the same coin..... Hopefully they will fail.... and decency, reason and humanity will win out over despair, hatred and division... But 2016 has taught us that cannot be guaranteed.
Remember the Spanish elecr that was turned by an alqueda train bomb atrocity a week or so before the poll. This inpacts the next question too.

15. And finally the European elections - Peak Populism will pass soon enough - hopefully it's this year and we can avoid any more pointless disruption from extremists like Le Pen getting elected - but lets not count our chickens just yet..... :beer:

LePen would obviously be a stretch especially against a right wing candidate who is playing the nationalist card, but who knows, were there to be a successful terror attack. Similarly Netherlands and possibly Italy if there is an election there. Germany will see another grand coalition probably right dominated as usual.

michaels

16. GBP will appreciate slowly unless the tory party breaks

17. Stock markets globally will have a strong run for the first half of the year

18. Oil will trade between 45 and 65

19. It will be the 3rd warmest year on record

20. We might see a uk election in the spring on the back of May announcing her Brexit plans but before article 50. May is not a natural risk taker but advisors will tell her she could bank 5 years with a good majority giving her more sway over backbenchers.

21. May is going for the supreme court on invoking article 50 for two reasons (a) to delay (b) to demonstrate to Tory eurosceptics that she is a true brexiteer and did everything she could to stop parliament from meddling. However this will not prevent the tory party splitting between those who think brexit means no fom and no euroean court and no single market and those who think it vital we retain all of these. Without an election the troy party will split and it is possible there will be a realignment of uk politics, the parliamentary majority would be formed by combining labour momentum refugees and tory non-brexiteers to be led by chukka uma or gideon or tony blair.....

BobQ

davomcdave wrote: »

I agree but in addition to that there are 27 other Governments that need to spend vast amounts of time and political capital discussing and agreeing the terms of Brexit in return for....nothing in most cases.

As a result I think the only possible outcome of Brexit is neither hard or soft Brexit but train wreck Brexit. Brexit with nothing agreed and nobody having a real idea about anything except for Britain no longer being in the EU.

All it takes is one of the 27 not to like a single part of the terms of the Brexit agreement for them to rip the agreement up. There is no way at all that 27 Governments will agree every part of Brexit. Never in a thousand years let alone two.

That's all off topic though as Brexit won't fail to be agreed in good time in 2017. That's for 2019.

Individual EU27 nations cannot veto the exit agreement. I believe that they will vote by Super Qualified Majority Voting so there is some scope for the smaller nations to disagree. What individual nations can veto is a trade agreement which is effectively a new treaty. https://fullfact.org/europe/eu-veto-brexit-deal/

Exit with no agreement = Hard Brexit in my view.

A transitional deal involving the EEA will emerge I believe but they may make us sweat for it into late 2018 unless they see some benefit in agreeing earlier. In terms of Brexit I see 2017 as being a frustrating experience for the UK with lots of rumours and leaks and little real progress by the end of the year.

davomcdave

BobQ wrote: »

Individual EU27 nations cannot veto the exit agreement. I believe that they will vote by Super Qualified Majority Voting so there is some scope for the smaller nations to disagree. What individual nations can veto is a trade agreement which is effectively a new treaty. https://fullfact.org/europe/eu-veto-brexit-deal/

Exit with no agreement = Hard Brexit in my view.

A transitional deal involving the EEA will emerge I believe but they may make us sweat for it into late 2018 unless they see some benefit in agreeing earlier. In terms of Brexit I see 2017 as being a frustrating experience for the UK with lots of rumours and leaks and little real progress by the end of the year.

I saw the two things as the same thing which I was wrong to do, my apologies.

Exit with no agreement isn't simply a Hard Brexit I think as it leaves both the EU and Britain with no idea as to what comes next and how the relationship is governed. I read the term 'train wreck Brexit' and it seems quite appropriate really if that's what happens. We'll see though, there's plenty of time for Britain and the EU to fail to reach an agreement. Brexit hasn't even happened yet.

wotsthat

BobQ wrote: »

Individual EU27 nations cannot veto the exit agreement. I believe that they will vote by Super Qualified Majority Voting so there is some scope for the smaller nations to disagree. What individual nations can veto is a trade agreement which is effectively a new treaty. https://fullfact.org/europe/eu-veto-brexit-deal/

Exit with no agreement = Hard Brexit in my view.

A transitional deal involving the EEA will emerge I believe but they may make us sweat for it into late 2018 unless they see some benefit in agreeing earlier. In terms of Brexit I see 2017 as being a frustrating experience for the UK with lots of rumours and leaks and little real progress by the end of the year.

That's my understanding too. However, even when votes are based on a majority the EU prefer to present a consensus so individual nations within the EU27 can still engage in some late horse trading so a unanimous agreement can be presented.

As it's a predictions thread I suspect what is about to happen is that the UK and EU are going to spend time at cross purposes. When we talk about exit negotiations we tend to infer that means arranging a trade agreement whereas the EU will see it much more in terms of the mechanics of leaving.

Trade negotiations could be conducted in parallel or separately at a later date but they're distinct from exit negotiations and will take longer than two years.

It's why I think the UK will pay for free market access at least in the short to medium term.

BobQ

Another prediction.....a major bank will fail following a cyber attack

http://www.bbc.co.uk/news/business-38517517

Crashy_Time

BobQ wrote: »

Another prediction.....a major bank will fail following a cyber attack

http://www.bbc.co.uk/news/business-38517517

Read as; bank failure will be blamed on hackers. I predict it will be an Italian bank, but the hackers will be "Russian".....:rotfl:

michaels

If I were a bank hacker I would choose one that actually had some money which counts out the Italian ones.....

TheNickster

No-one has mentioned the rise in consumer debt partly fuelled by credit card offers that may well account for why some of the doom and gloom forecasts have not (yet) materialised.

In my view this is storing up trouble for the future.

The Bank of England is too complacent about rising debt in households with stagnant incomes. But government dare not risk any slowdown in spending

michaels

TheNickster wrote: »

No-one has mentioned the rise in consumer debt partly fuelled by credit card offers that may well account for why some of the doom and gloom forecasts have not (yet) materialised.

In my view this is storing up trouble for the future.

The Bank of England is too complacent about rising debt in households with stagnant incomes. But government dare not risk any slowdown in spending

I was thinking about this earlier and two questions:
1) Does this include student loans and the new way of buying cars like mobile phones (and conversely does it exclude mobile phones where contracts are effectively hp agreements)?
2) Is this a consequence of the tightening of mortgage lending - smaller cheaper mortgages means people think they have more headroom for other borrowing?