The hedge funds “Man on the Inside” published his fearless forecast for 2008 (the “Sturdy 30”). Hedge funds may have gotten a bad rap from their role in the subprime collapse, but they’re still here and the people behind tham are still making some incredible predictions. From basketball, to politics, to business and much mure more here is “the man’s” complete list:
1. The Dow will go below 10,500 led by a collapse in consumer discretionary stocks.
2. The 10-year note yields below 3%.
3. The problems in the U.S. banking sector won’t be solved by a government-sponsored program. It will only shine more light on the problems.
4. The Fed’s continued panic-easing will only exacerbate our problems, as Bernanke’s creation of real negative interest rates takes hold, laying the groundwork for more problems.
5. Inflation will rear its ugly head, making the term “stagflation” in vogue again.
6. Most economists will capitulate and admit we are in a recession by March.
7. Obama-Clinton ticket for Dems.
8. McCain-Huckabee for Republicans.
9. The Dems will win a landslide receiving a popular vote not seen since Johnson’s victory against Goldwater.
10. EMs will recover violently by mid year after investors temporarily abandon the sector due to inflation fears.
11. Energy stocks will be flat for most of the year as investors debate the stagflation conundrum.
12. Giuliani will move into oblivion after he files for divorce once more.
13. Edwards is in Obama’s cabinet.
14. Housing in NYC will move down 20% as Wall Street bonuses collapse.
15. Hedge funds’ assets will move up to $3 trillion by the end of the third quarter.
16. ABL funds, alternative energy funds along with distressed credit will lead the charge in returns to investors, followed closely by emerging markets.
17. Oil prices will prove less volatile than 2007.
18. “There Will be Blood” and “No Country for Old Men” will sweep the Oscars.
19. Unemployment will hit 6% by the November election.
20. Morgan Stanley will be acquired by JP Morgan.
21. Bear Stearns will be acquired by Bank of America.
22. The Cleveland Indians will win the World Series beating the Los Angeles Dodgers in five games.
23. Roger Federer will win the Grand Slam.
24. Risk management will be the rallying cry for both hedge funds and investors.
25. Consolidation in the funds of funds world will be a focal point for investment bankers.
26. Duke, Memphis, UCLA and UNC will be in the Final Four.
27. George Bush will become an environmentalist.
28. Al Gore will star in another movie.
29. There will be a forced merger between AMBAC and MBIA
30. Long/Short equity will be the worst performer in the hedge fund space.
Care to comment? Keep in mind these guys last year said the subprime situation was “more illusory than real.” Only time will tell.
Benjamin Bach
January 29, 2008 at 1:59 pm
“Housing in NYC will move down 20% as Wall Street bonuses collapse.”
Unless sports stars, movie stars and ‘society types’ also lose their shirts, I just don’t see Manhattan getting cheaper.
Jonathan Dalton
January 29, 2008 at 4:18 pm
He’s also already wrong on one … Federer went down this weekend.