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Posts Tagged ‘predictions’

The Perils of Prediction

The Perils of Prediction 

Courtesy of Charles Hugh Smith, Of Two Minds 

Fortune teller wheel

Nobody knows the future, so the best we can do is strive for an open mind and flexibility in our thinking and responses. 

In 1904, the "fact-based" consensus was that rising prosperity would stretch into the future as far as imagination allowed. The prosperity was so widespread that war, it seemed, had been abolished as bad for business.

In 1904, Imperial Tsarist Russia, though suffering from the usual spot of bother now and again, was stable and enduring. In 1904, Great Britain viewed France as its continental rival.

Ten years later, advanced, peaceful, hopeful Europe stumbled into the Great War, and three years into that war Tsarist Russia fell to revolution.

In 1928, permanent prosperity was again the consensus. Two years later, that hope was reduced to ashes.

In 1930, Germany and Japan were economically troubled, as were the other great nations of the world, but neither were seen as threatening. Less than ten years later, the two nations had declared war on the world.

In 1980, fear of a sudden massive Soviet tank attack on West Germany sparked a series of "what if" books and a push for short-range nuclear-armed missiles in Germany--a U.S. plan which galvanized the Western European peace movement.

Ten years later, the Soviet Empire had crumbled into dust and abandoned gulags.

In 1975, scholars and pundits confidently declared that the "cult of Mao" which fueled China’s Culutral Revolution was so entrenched, so pervasive and so central to China’s Communist regime that would outlast Mao the mortal and thus into the next century.

Three years later, Mao was dead and the Gang of Four lost power. Ten years after 1975, when the Cult of Mao was universally viewed as a permanent feature of China, that nation was four years into the state-controlled, limited-capitalist model of engaging the world that created its present-day pre-eminence.

I think you see my point: consensus predictions of what the future holds are generally wrong. The consensus in the U.S. about the world of 2020 is that it won’t be much different from the world of 2010. All the actuarial tables of Social Security run to 2040 and beyond, as if the road ahead will be an extension of the past sixty years of American global dominance and credit-based prosperity.

That alone tells me 2020 will…
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How your brain remembers the future

Déjà vu, all over again.

How your brain remembers the future

Image Of Thinking Man's Brain Through Bowler Hat

By NewScientist

IT’S like remembering the future. Our brain generates predictions of likely visual inputs so it can focus on dealing with the unexpected.

Predictable sights trigger less brain activity than unfamiliar stimuli, bolstering the view that the brain is not merely reactive, but generates predictions based on the recent past. "The brain expects to see things and really just wants to confirm it now and again," says Lars Muckli at the University of Glasgow, UK.

[...]

The finding supports the "Bayesian brain" theory, which sees the brain as making predictions about the world which it updates when new information comes in.


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Few Called Market Turn, Fewer Predict It Will Last

H/t to Pragcap.

Few Called Market Turn, Fewer Predict It Will Last

market turn, time.comBy AP / TIM PARADIS, courtesy of TIME

(NEW YORK) — Few analysts forecast this year’s remarkable stock market rebound as major indexes were plunging to 12-year lows last March. Now, with most experts predicting the pace of stocks’ gains will slow in 2010, there’s reason to believe they will be proven correct.

Stocks began the dramatic turnaround in March after Citigroup Inc. and other big banks said they were making money again, and then climbed at a fairly steady pace as signs of an economic recovery from the Great Recession became more pronounced.

Investor fears about a potential financial system collapse played a big role in the early year slump in stocks. Once it was clear that wasn’t going to happen, the Standard & Poor’s 500 index roared back 64.8 percent from its early March low, the biggest move since the Depression. For the full year, the index rose 23.5 percent, its best showing since 2003.

But sustaining that momentum in the new year likely would require a big drop in the unemployment rate and strong corporate profit gains, along with stable borrowing costs--a combination few analysts are forecasting.

"The easy money has been made already," said Bill Stone, chief investment strategist for PNC Wealth Management. "You’re not going to see another 65 percent move in the next nine months."

In the last day of the year, more signs of healing first pleased investors, then had them concerned about the economy’s ability to thrive without government help. Light trading volume exaggerated the market’s moves, sending the Dow Jones industrial average down 120.46, or 1.1 percent, to 10,428.05.

The year’s stats tell an incredible story across the financial markets:…

Stock market gains often come months before economic recoveries are confirmed. That’s because investors tend to bet on how they think business conditions will be six to nine months in the future. In downturns during the past 60 years, the S&P 500 index hit its bottom an average of four months before a recession ended and about nine months before unemployment reached its peak…

Ron Kiddoo, chief investment officer at Cozad Asset Management in Champaign, Ill., said the market can continue its rally through 2010 only if investors see that companies are again hiring, bringing the unemployment rate down for its present 10…
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GOLDMAN SACHS 2010 INVESTMENT OUTLOOK – THE BULL WILL CONTINUE

GOLDMAN SACHS 2010 INVESTMENT OUTLOOK – THE BULL WILL CONTINUE

Courtesy of The Pragmatic Capitalist

Fortune's Andy Serwer Interviews Goldman Sachs' Lloyd Blankfein

The rally is going to continue into 2010 according to Wall Street’s most influential bank   (Please see here for Goldman’s top 10 trades of 2010). Analysts at Goldman Sachs Europe and America have released their full year 2010 estimates and they are very bullish about the upcoming year.

Goldman sees very low rates, stronger than expected earnings, strong commodity demand and investor reallocation driving prices higher.  Goldman sees no rate changes through 2011 – one of the most accommodative outlooks of any bank we have covered.  Stronger than expected revenue growth and continued margin expansion will result in 15%+ equity returns in the upcoming year.  Although they see a continuation in the rally some moderation is expected.  As we previously mentioned, their analysts expect many similarities to 2004.  David Kostin wrote:

“Continued profit margin resiliency from prior aggressive cost reductions should drive strong returns in early 2010 and push the S&P 500 towards 1,300.”

Their analysts in Europe are even more bullish.  They see the DJ STOXX 600 rising 20% to 300 by the end of 2010.

Goldman argues that we are transitioning into the growth phase of the recovery from the hope phase.  This period is generally characterized by stabilization in economic growth and lower equity returns than the hope phase.  Nonetheless, doubt remains and catalysts for higher stock prices remain.

gs21 GOLDMAN SACHS 2010 INVESTMENT OUTLOOK   THE BULL WILL CONTINUE

Perhaps most important, Goldman sees a continued influx of cash to the equity markets.  Thus far, investors have been risk averse and either remain in cash or have moved into bonds.  Goldman sees a substantial move into equities as investors become less risk averse.

cash GOLDMAN SACHS 2010 INVESTMENT OUTLOOK   THE BULL WILL CONTINUE

How to play it?  Thematically they focus on three key themes:

  • Dispersion – higher growth and higher sustainable returns companies.
  • BRICs exposure.
  • High and growing dividend growth companies.

* You can find Goldman’s 2010 commodity predictions here.

Source: GS

 


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Mid-Year 2009 Checkup

Here’s Karl Denninger’s mid-year review of his new year predictions, and thoughts on 2009 part 2.

market predictionsMid-Year 2009 Checkup

Courtesy of Karl at The Market Ticker


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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!

 
 

Insider Scoop

NXP To Supply Apple With Mobile Payment Chips

Courtesy of Benzinga.

Related NXPI Stocks Hitting 52-Week Highs Morning Market Movers

NXP Semiconductors NV (NASDAQ: NXPI) gained three percent in pre-market trading Friday on a report it's providing wireless chips to the Apple (NASDAQ: AAPL) iPhone 6, enabling a mobile payment system.

The Netherlands-based semiconductor company makes so-called Near Field Communications chips that smartphones use to communic...



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Chart School

The S&P 500, Dow and Nasdaq Since Their 2000 Highs

Courtesy of Doug Short.

Here is a update in response to a standing request from a couple of sources that I also share with regular visitors to my Advisor Perspectives pages.

The request is for real (inflation-adjusted) charts of the S&P 500, Dow 30, and Nasdaq Composite. In response, I maintain two overlays — one with the nominal price, excluding dividends, and the other with the price adjusted for inflation based on the Consumer Price Index for Urban Consumers (which is usually just refer to as the CPI). The charts below have been updated through the August 29th close.


...



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Phil's Favorites

Black Sea Oil Claims Before and After Russia Annexed Crimea

Courtesy of Mish.

The significance of the annexation of Crimea by Russia goes far beyond land territorial claims. Here are a couple of maps that show how Crimea affects oil rights in the black sea.

Black Sea Claims Before Crimea Annexation



Black Sea Claims After Crimea Annexation



The above charts from the New York Times article ...



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Zero Hedge

Asian Property Prices Are Falling "As If There's A Global Financial Crisis"

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

With China's property developers slashing prices, piling on incentives, and still seeing sales slump; it is no surprise that demand from the top to the bottom across Asia is falling. As Reuters reports, even Singapore's Sentosa Cove (the man-made island resort billed as Asia's Monte Carlo) is eerily silent as the billionaires seem to be staying away with prices down over 20-30% in the past year. New mortgage business is down over 40% as "the...



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Stock World Weekly

Stock World Weekly

Newsletter writers are available to chat with Members regarding topics presented in SWW, comments are found below each post.

Here's the latest issue of Stock World Weekly. Click on this link and use your PSW user name and password to log in. Or take a free trial. 

Enjoy!

...

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Option Review

Puts Active On Buffalo Wild Wings

Buffalo Wild Wings Inc. (Ticker: BWLD) shares are in positive territory in early-afternoon trading on Thursday, reversing earlier losses to stand up 0.50% on the session at $148.50 as of 12:15 pm ET. Options volume on the restaurant chain is running approximately three times the daily average level due to heavy put activity in the October expiry contracts. It looks like one or more traders are buying the Oct 140/145 put spread at a net premium of roughly $1.45 per contract. As of the time of this writing, the spread has traded approximately 3,000 times against very little open interest at either striking price. The put spread may be a hedge to protect a long stock position against a roughly 6% pullback in the price of the underlying through October expiration, or an outright bearish play anticipating a dip in BWLD shares in the next couple of months. The spread makes money at expiration if shares in BWLD decline 3.3% from the current price of $148.50 to breach the breakeven point...



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All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Sabrient

Six Companies Push Tax Rules Most

Reminder: Sabrient is available to chat with Members, comments are found below each post.

Courtesy of Sabrient Systems and Gradient Analytics

Gradient Senior Analyst Nicholas Yee reports on six companies that are using a variety of techniques to shift pretax profits to lower-tax areas. Featured in this USA Today, article, the companies include CELG, ALTR, VMW, NVDA, LRCX, and SNPS.

Six Companies Push Tax Rules Most

Excerpt:

Nobody likes to pay taxes. But some companies are taking cutting their tax bil...



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Digital Currencies

Disgraced Mt Gox CEO Goes For Second Try With Web-Hosting Service (And No, Bitcoin Not Accepted)

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Mt Gox may be long gone in the annals of bankruptcy, but its founder refuses to go gentle into that insolvent night. And, as CoinDesk reports, the disgraced former CEO of the one-time premier bitcoin trading platform has decided to give it a second try by launching new web hosting service called Forever.net and is registered under both Karpeles’ name and that of Tibanne, the parent company of Mt Gox.

From the company profile:

“TIBANNE Co.Ltd. ...



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OpTrader

Swing trading portfolio - week of August 25th, 2014

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Market Shadows

Helen Davis Chaitman Reviews In Bed with Wall Street.

Author Helen Davis Chaitman is a nationally recognized litigator with a diverse trial practice in the areas of lender liability, bankruptcy, bank fraud, RICO, professional malpractice, trusts and estates, and white collar defense. In 1995, Ms. Chaitman was named one of the nation's top ten litigators by the National Law Journal for a jury verdict she obtained in an accountants' malpractice case. Ms. Chaitman is the author of The Law of Lender Liability (Warren, Gorham & Lamont 1990)... Since early 2009, Ms. Chaitman has been an outspoken advocate for investors in Bernard L. Madoff Investment Securities LLC (more here).

Helen Davis Chaitman Reviews In Bed with Wall Street. 

By Helen Davis Chaitman   

I confess: Larry D...



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Pharmboy

Biotechs & Bubbles

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Well PSW Subscribers....I am still here, barely.  From my last post a few months ago to now, nothing has changed much, but there are a few bargins out there that as investors, should be put on the watch list (again) and if so desired....buy a small amount.

First, the media is on a tear against biotechs/pharma, ripping companies for their drug prices.  Gilead's HepC drug, Sovaldi, is priced at $84K for the 12-week treatment.  Pundits were screaming bloody murder that it was a total rip off, but when one investigates the other drugs out there, and the consequences of not taking Sovaldi vs. another drug combinations, then things become clearer.  For instance, Olysio (JNJ) is about $66,000 for a 12-week treatment, but is approved for fewer types of patients AND...



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Promotions

See Live Demo Of This Google-Like Trade Algorithm

I just wanted to be sure you saw this.  There’s a ‘live’ training webinar this Thursday, March 27th at Noon or 9:00 pm ET.

If GOOGLE, the NSA, and Steve Jobs all got together in a room with the task of building a tremendously accurate trading algorithm… it wouldn’t just be any ordinary system… it’d be the greatest trading algorithm in the world.

Well, I hate to break it to you though… they never got around to building it, but my friends at Market Tamer did.

Follow this link to register for their training webinar where they’ll demonstrate the tested and proven Algorithm powered by the same technological principles that have made GOOGLE the #1 search engine on the planet!

And get this…had you done nothing b...



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