2013 Outlook, a review of our 2012 Outlook.
1. We wish a very happy, healthy and prosperous 2013 to you.
2. (2012) We should continue to do well in the new year with our core positions and ideas ; short China, short gold and silver, long U.S. dollars. Short Brazil looks good to us too, but we do not yet have a re-entry on that position.
(2013) We were wrong on all of #2 though all were essentially flat. No idea about 2013, but if we have to guess we'd say the same as above.
3. (2012) At some point in the future, perhaps in 2012, a long-term trend change in U.S. interest rates will happen and TBT will rocket. We diarized an initial entry in TBT in early August, too early and at too high a price. At the time we wrote that "we'd not be surprised to see it as low as $20 but if it gets there we'll possibly buy more." TBT has spent the last three months between $17.50 and $23 but we've not added to our position as we fear it may go much lower still. Those without a position may wish to speculate on an initial or partial entry at current prices.
(2013) Factoring in the 1:4 split in 2012, those prices quoted above should be $80, $70 and $92 respectively. TBT began 2012 at $63.45 (split-adjusted). It then did go "lower still" and by mid-year looks to have bottomed and the "long-term trend change" we mentioned may have begun. We remain long-term bullish TBT.
4. (2012) We're neutral on U.S. equities at present. Our macro market calls have generally been excellent in this blog, and in our personal accounts we normally trade in accordance with those views. Equities at present are extremely overvalued on a fundamental and logical level, and a massive tanking in equities would be nice in the sense that it'd punish the complacent and provide sane pricing for the prudent, but that doesn't mean a massive rally couldn't currently be underway which wipes out the bears, thus we trade based on technical and trend considerations rather than fundamentals. Time will tell, and we'll try to trade the swings successfully along the way. When we've a firm opinion on upcoming market direction, we'll post it.
(2013) Equities did continue higher, wiping out many bears, and have been flopping about ever since. Markets remain extremely overvalued.
5. (2012) We believe fear over the euro situation is mostly mass hysteria, and it'd be very good for western economies in the long run if there were to be an end to the common currency with banks and bondholders taking their deserved lumps. For once we'd have truly "free markets" but instead we'll probably suffer continued "extend and pretend" jawboning and policies, thus perhaps a continuation of the past eleven months of wildly-swinging markets.
(2013) Nothing was settled in Europe, and nothing has changed. It was indeed much ado about nothing, and like the ridiculous U.S, "fiscal cliff" hysteria, is not worth our attention or conjecture.
6. (2012) An observation : the Dow Jones Industrial Average is currently at the same level as it was mid-February, early and late March, mid-April, late May, mid-June, mid-July, early August, late October, mid-November and early December.
(2013) It was at that same level in mid-2012 and could easily be again before too long.
7. (2012) Early in a new calendar year markets will often establish a tend and continue from there in the same direction. Roughly 12250 in the DJIA has been a good over/under line since February and might continue to be, meaning for the long term we should on net think bullishly above that line and bearishly below.
(2013) That proved an excellent strategy, as the DJIA was below 12250 for only 3 days mid-year. For 2013, that over/under line is 13000.
8. (2012) Another good litmus test is Goldman Sachs (GS) below $87.50 being very bearish for the market overall, and below $100 mildly bearish. Bullish above $100.
(2013) This year: bullish above $112, mildly bearish below, and extremely bearish below $100.
9. (2013) We'll add the litmus test of AAPL <> $500.
We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or companies in this blog. If we hold existing positions we divulge the fact.
This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.
Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.
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