Just about this time three years ago I published a bit of satire titled How to be a Stock Market Guru and get on MSNBC. In it I mocked the idea that anyone can predict the short-term market and laughed at those who claim they can. Just as one of my financial heroes, Louis Rukeyser, used to do on his weekly TV program Wall Street Week.
Every January Rukeyser would have his impeccably credentialed guests predict the market’s high, low and close for the year. I forget his exact line, but after the predictions were in he’d say something like, “…with the understanding that even these exalted experts could be wrong, there you have it.” And he’d wink knowingly into the camera.
Come the following December 31st he’d salute those few who’d come closest and chide the many goats.
The key thing his program and its parade of guests taught me is that, at any given time, some expert is predicting any possible future that could conceivably happen. Since all bases are covered, someone is bound to be right. When they are, their good luck will be interpreted as wisdom and insight. If their prediction happened to be dramatic enough, it could also lead to fame and fortune. But it is all nonsense.
Sadly, Mr. Rukeyser passed away in 2006 and the current generation of investors is left without his insights and wisdom.
But in that post, in his honor and his lighthearted spirit, I introduced the jlcollinsnh.com 1st Annual Louis Rukeyser Memorial Market Prediction Contest for the year 2013.
Then, after all this emphasizing of how silly such predictions are, I went and won the damn thing myself. At least on the high and close picks.
My predictions fell short for 2014 but were still pretty impressive for a guy who doesn’t believe predicting the market is possible. But not nearly impressive enough to win even one of our categories that year.
However, almost as if to prove how silly such predictions are, my results were truly wretched for the year just past:
S&P 500 2015:
- High: 2131 reached on May 21st
- Low: 1868 reached on August 25th
- Close: 2044 on December 31st
- High: 2533, off by 402(!) points
- Low: 1812, off by 56 points
- Close: 2471, off by 427(!!) points
For the High and the Close it would have been pretty hard to do worse. But some of you managed and I’ll be mocking you shortly.
But first, who among my readers had the audacity to best me at my own game? Most of you it turns out. Even for the low fully 16 of you were closer than, or tied, my 56-point miss.
The best of the best are….
For the High and (!) the Close:
For the first time since I did it in the inaugural contest, we have one winner in two categories. Tom called for a High of 2145, off a scant 14 points and a Close of 2028, missing by only 16. He was wrong about the Low, being 122 points too pessimistic. But he did come spookily close to calling when his high and low would happen. Very impressive and a bit irritating as he presented his predictions so seriously:
“The high will occur early-ish in the year, and later in the year we’ll have a fairly major correction. We seem overdue for one that’s more than the usual 5-10%.
“As for the close being slightly lower than 12/31/14, I think that while our economy is in fine shape, it has risen too quickly and the currently high Shiller P/E seems to agree. There is also a sense that the Fed will increase rates in 2015, which will reduce stock prices, even if it’s only because Wall Street types get spooked.”
Yer making this prediction stuff sound plausible there, Tom.
Fortunately he was completely wrong about his call for a major correction.
So, congratulations and well done Tom! But whadaya got for us in 2016? Bet I get to mock you yet!
For runners-up on the High
While being fully 100% worse than Tom’s 14, Dollar Flipper‘s 28 was good for second place. However, his Low (216) and Close (172) were completely unimpressive, but then he did say: “I pulled them right out of my butt.”
Reepekg, off by 31, came in third. A dismal showing given his promising start last year.
His was the very first entry in the 2014 contest and he took the Low crown impressively, just 7 points off. But, even caught cheating by using owl pellets to divine his number, he promptly took to unseemly bragging:
“I’ve covered myself in glory! Victory is mine! Welcome to 2015, the year of insufferable gloating by Reepekg…”
While I can fully appreciate how winning a contest as prestigious as this one might go to one’s head, muster up a little decorum there, Reepekg.
Worse, for his performance anyway, “This year I have refined my methods considerably. Instead of pellets, the key is the owls themselves!”
In addition to being able to only deliver a third place finish, the owls had him off by 199 on the Low and 160 on the Close.
So my advice Reepekg is, go back to the shit.
Interestingly, Reepekg‘s Low and Close were also the closest to Dollar Flipper‘s. While I have no evidence that they were in collusion, he has been known to use owl poop and we can only guess what coated DF‘s numbers given where they came from. Coincidence, or conspiracy?
For runners-up on the Close
Draggon‘s 33.81 off the pace was good for second place on the close. Off only 58.64, his High would have put him in fourth place if, you know, we acknowledged losers down to that level.
He gave us fair warning: “Much to all of you-all’s advantage, I wasn’t around to smash the competition last year. But BEWARE – for I am here now to make my prognostication!”
Still, for all his fire-breathing, he didn’t actually win anything. And, of course, his wretched 148.24 miss on the Low surely put ashes in his mouth.
Clint missed the close by 44, good for third place. He told us “…we won’t see a massive beatdown or bull run. Either way, it’ll end up being a mediocre (+/- 10%) year.”
While his high missed by 99 and his low by 159, no one gave a better verbal description for how the year actually unfolded. Well done Clint. I got my eye on you!
For the Low:
This year we had a tie, and both were only 11 points off the mark. Both also turned in miserable performances for the High and the Close. Since Krishanu was slightly less miserable, we’ll start with him.
Krishanu called his predictions “My three cents” and went on to say: “Reasoning: Looking at the market today, these 3 numbers jumped from my sub-conscious to my conscious mind before I started typing. Also known as gibberish.”
Good thing you added that line about gibberish there, Krishanu. Without it there might have been no end to my mocking.
Still the whole hyper-jump from sub-conscious to conscious was good for a win in at least the Low category, and that’s something no one else was able to do.
Other than jimcramer.
All jimcramer had to offer with his predictions was “booyah!” a transparent attempt to convince us that he is the TV personality of the same name. With his dreadful calls on the High (139) and the Close (155) it could have been possible. But with winning the Low? Not a chance.
Showing just how tough winning the Low this year was, five more entries came with 25 points:
Off by just 14.9, Darcy said:
“I’m new to the whole investing scene, so if I lose I’m chalking it up to inexperience, ignorance, and general incompetence. If I win, of course, it’s clearly due to my expert knowledge and market assessment.”
With your pathetic High off 298.6 and Close off 220.9 Darcy, it is a little of both!
Mr. FC was close behind, off by only 16. Why did he come so close? “…a bird flew by and pooped in the yard. That’s why.”
His High missed by 199: “Why? Just because.”
His Close missed by 127: “… my model says that the market has a 7% rise each year and if that happens, I’ll be a happy guy. And I like to be happy”
Listen very carefully, Mr. FC: Mr. Market doesn’t care about you being happy. Stick with the bird poop. It is a time honored strategy around here. Just ask Reepekg.
Mr. Frugalwoods missed the Low by only 18 points. In offering his prediction he said: ‘Love this!” and “…my dog has just as much chance of being right… (and even for a dog, she’s not that bright)”
Would she have been bright enough to best your misses on High (180) and Close (244)? Maybe she’d gaze into the crumbs at the bottom of her food bowl and divine the correct numbers? Better perhaps than your approach of “randomly picked reasonable sounding numbers out of thin air.”
Still, your effort certainly qualifies you “for a recurring segment on CNBC.” (See how little regard I have for those with recurring segments on CNBC?)
This year give Frugalhound a chance!
Linda missed by only 21. “My prediction for this year has been suitably toned down after my ‘half’-baked prediction for 2014.” Good move Linda! But then she “applied some serious economic analysis” and came up with a High off by 86 and a Close that missed by 140.
Mike 4 ended all his predictions with the number 44. “What can I say,” he said “I like the number 44.” Fair enough. It got him within 24 of the actual low. Of course, his High and Close were off by 313 and 300. No fours to be found. But then, I had fours and did even worse.
Across the board….
Peter Akkies said:
“I’ve been analyzing recent stock trading data for my job for the past few weeks so I must be extraordinarily qualified to make predictions for the S&P 500.”
Boy howdy, that’s just asking for abuse when you fail. Unfortunately, Peter did pretty good. His Low, an exceptionally tough category this year, was off by only 26. His High missed by 60 and only four people did better. And while his Close was an unimpressive looking miss of 115, truth is only seven were more accurate.
So, well done Mr. Akkies. But the question is will you now cravenly avoid this contest and rest on your laurels? Or will you step up again giving me the almost certain opportunity to mock your failure come this time next year?
IndigoCZ said “Despite a long time coming correction, we’ll still end up a little. Or not.”
Well we had the (~10%) correction and finished flat, so not a bad call. And more modestly stated than Peter above. At 72 off the High, 105 off the Low and 77 off the Close, not bad numbers either.
No pressure, but we expect BIG! things from you this year, Indigo!
jkenny didn’t win anything, but his numbers (High 113 – Low 110 – Close 79) were close enough I kept noticing him on the spreadsheet.
Last time, after his dismal 2013 showing, jkenny said: “Definitely feel like the market’s going to lose it’s head of steam by year end, but I felt that way in 2013 too. Could I have been wronger?!”
Maybe not wronger, but wrong again none-the-less, I told him.
This time a chastened jkenny said: “I’m weighing in again for this year’s collective humility exercise in market predicting.”
If he’d stuck to his “going to lose it’s head of steam by year end” theme he’d have finally been a winner. But, alas, it was not to be.
He went on to say: “It’s fun! It’s unvarnished truth! It’s free to enter this competition! Yay!”
Mmmm. You may have given me an income idea there, jkenny.
Looking back, the mighty always fall…
After Pura Vida Nick took the honors for his prediction last year for the High, missing it by a scant 7 points, he failed to even try for 2015. His Closing prediction of 2029 was also remarkably close to the actual close of 2059. Resting on those laurels are we, PVN?
As for the Close last year we had a three-way tie and each were only 9 points off the mark. This year?
RW was a no show, cravenly avoiding the arena like PVN.
dude missed the Close by gaping 139 points this time, and his miss on the High – 127 – was almost as bad. His 56 point miss for the Low looks pretty good until you realize 16 other players did better. Plus it matched my own miss and matching me this year is a sure fail.
At least he has the graciousness to say: “No doubt, my 2015 predictions will be wildly off!” But then, like Tom, he went on to provide some o-so-serious analysis of why he made the predictions he made, including for a Black Swan event.
Like I said last year: “Dude! Your analysis makes such perfect sense your predictions are almost sure to be wrong!”
Last year in accepting his win for the Close, Chris K said: “I am almost blushing except for the fact there as no skill involved in this prediction.” No consistency either, Chris!
He missed the Close this time by a full 180 points and was a pathetic 244 off the High. But off 47 for the Low he at least smoked the dude!
As I said at the time: “No worries Chris, your new predictions are sure to prove no skill is involved.”
For last year’s Low? How much more can we beat up on poor Reepekg?
OK, enough of that. Let’s get on with chiding the goats!
Poor goats. Always on the edge.
The Big Losers…
This year about the stupidest thing you could do was to follow my lead. And, indeed, two contestants were just that stupid:
frugalfighterpilot chose his numbers “Reasoning: To be one(1) better than Mr. Collins in every category.”
This earned him the fourth worst performance on the High and the third worst on the Close. Ever hopeful, he further wanted to know: “Do ‘Price is Right’ rules apply in stock market picks too?”
Ah, no. Not that it matters for you.
forestbound admitted “I have not (emphasis mine) ONE CLUE…” Then he proved it when “…I took Jim’s numbers and upped each one by 3. Why? Because, I’m a crazy (read “lazy”) optimist!”
This bit of cluelessness earned him an even more terrible performance than frugalfighterpilot. His was the third worst for the High and the second worst for the Close.
Guys, stealing a phrase from my pal Jeremy at Go Curry Cracker:
“Think of everything you read here as being written by your unemployed Cousin Larry who wants to borrow $20”
Two years ago, Rob Diesel was our overall winner. His 2013 high came in at #3, his low at #1 and his close at #2. Very impressive and few have done better since. But last year? Last year, not so much…
For 2014 Rob was our biggest, and wrongest, optimist calling for a high off the mark by a whopping 522. He also posted the second worst performance in the closing category, off by 424. His low missed by only 110, saving him from a clean sweep in the goats’ placing. Still, it was enough to crown Rob 2014’s biggest loser!
He’s come up in the world. For 2015 his High was only second worst at 482 off and his Close, off by 317, was only less ugly than the five very worst performers. Only nine people missed the Low by more than his 133 mark.
In entering for 2015 year Rob told us:
“The *real* reason I didn’t win this year (2014) is that all you Debbie Downers artificially depressed the market. That, and some other vague things like ‘cautiously optimistic’ and ‘hedging the bets’ and ‘taking profits’. I think that should be enough that I can spin anything I say NEXT year into ‘I told you so’.” Ah, how exactly?
He also pointed out: “…at this point I am still at 50%! Pretty impressive statistics over two years.”
And now you are at 33%, Rob. Bet I could get a jump start and begin composing how you’ll be at 25% this time next year….
Merk entered first and came in near the bottom: 331 off the High for fifth worse and 347 off the Close for fourth. Only the top five Low losers did worse than his Low, off 162. Merk told us: “I have no idea how to predict the stock market, so I picked a range of numbers and had random.org pick the numbers for me.”
Right you are Merk, you don’t. And random.org doesn’t either. At least you didn’t follow me.
While the losers for the High and Close were frequently the same, those for the Low tended to be one offs. In descending order…
Fifth worst was george fritz hahn, off by 168 points. Refering to his prior year’s poor showing, in entering he complained: “What! I’m not the biggest loser?”
Originally posting as The New Mexico Lobo, his pessimistic predictions went on to earn him the title of biggest loser in the 2013 contest. For 2014 he was only an ordinary loser and this year a disappointing fifth.
You’re still not the biggest, george fritz hahn, but you’re a solid loser none-the-less.
Fourth, and off by 187, we have Charlie Jax. Charlie also placed fifth worst for the Close, off 332. Off 281, his High prediction was no great shakes either. A man of few words, Charlie said he: “did research and stuff.” Not enough, Charlie. Not enough.
Third worse, off 199, was Reepekg. Really. What more can we say about poor Reepekg?
Well, we can say he did better than Dollar Flipper, who came in second at 216 off.
To be the #1 worst predictor for the Low in 2015 you had to miss it by a whopping 259 points. Done by Forty done did it. In making his predictions, he said:
“I didn’t place this year (2014)…shoot. But if weekends at the roulette table have taught me anything, it is this: if you keep playing the same numbers, eventually they hit. So, let’s just take the same figures as last time around.”
Difference is, DbyF, around here those same numbers can make things even worse. This ain’t some easy walk in the park like Roulette!
But for overall worst of the worst, the prize goes to Mrs EconoWiser. Her High was off a wopping 619 and her Close by 613. In her Low, off by 131, she was embarrassingly close to Rob Diesel. Not where you want to be this year. Or last. Or likely in 2016.
She failed in 2014, although less badly, using the “stock fairy” for guidance. This time she told us she “Sent the failing stock fairy back to her family and have now consulted a magic rainbow unicorn.” Maybe it’s time to put the unicorn out to pasture and see if that fairy is still talking to you, Mrs. EW.
Odds and ends…
From those who ended in that vast grey area of not winning and not being truly wretched, let’s look for a moment as to how they arrived at their oh-so-unimpressive numbers.
Mary: “I was born in one of those years.”
Too bad you weren’t born in 2131, 1868 or 2044, Mary.
ak907: “Never made a prediction before but here it goes. Based on nothing but my feeling that this will be a weak up year, possibly with some terrorism (ISIS) and interest rate related panics…”
While it didn’t much effect the markets, you were sadly spot on regarding ISIS.
fatchance: “When I asked you to close 2 days early (for the 2014 contest), I was within a $1. I showed my 15 year old son who is taking a business class and he thought I was a genius and told his teacher I could predict the market. I felt like a winner even with the loss. Had I known bribes were an option to close the contest at that time, I would have pursued that route.”
I told fatchance bribes are absolutely an option and, looking at my predictions, clearly I absolutely control the markets. Still, no bribe was forth-coming. Instead, this year all he had to offer was:
“I am an optimist. I don’t think I would ever predict the market would go down in a given year or I would not be in it for that year.”
Danny: “Saw a lot more trading at the end of 2014 from the ‘professionals’ at where I work. However, overall it was less than 2013. Surprisingly though my company’s funds kept up again with the S&P 500 (even after expense fees). Maybe I should go ask the traders for some advice.”
Seth: “I’ve got a guy.” Get another guy Seth, get another guy.
Matt V.: “I really hope I’m wrong and the market takes a tumble so I can invest at lower prices and maybe move some of my bond position into stocks.
“Here’s my tongue-in-cheek analysis: This bull market still has a bit left to run and the US economy is strong, but investors have a lot to be wary of with deflation fears in Europe, instability in Greece, and the Fed set to increase borrowing costs by raising short-term interest rates. We’ll end the year up around 6%, but it will be a bumpy ride.”
Great analysis, and even occasionally right – on the bumpy ride and (slightly) on interest rates. But, sadly, no help in your market predictions.
Matt: “Here’s your winner…I used the classic method of analyzing P/E ratios against my fantasy football success to arrive at those numbers.”
Great! But, er, where’s my winner?
Kay: “I am pretty sure that the high will be 2413, the low 1734 and 1908 will end at 1934. Or at least, I happen to like those numbers.”
Glad you like them, Kay. But they weren’t correct for 2015. I haven’t checked for 1908.
Jason R.: “Most years are good years, so that’s where I’ll base my prediction. Wouldn’t be surprised to see a much lower low or a higher high or a close anywhere on the board, but if your forcing a guess, I’ll go with around the past’s average year.”
Even after hedging all his bets, Jason still got it wrong.
Prob8: “There are many reasons for the S&P to end up in the red this year.”
“First, this bull market is getting long in the tooth. I believe this bull is in the top five, if not top three at this point. Pretty impressive, but the odds are not in favor of a lengthy continuation.
“There’s also quite a bit of unrest due to the economic and political atmosphere overseas. Oil issues will continue to be problematic and there will, no doubt, arise some new issue this year that will send the market sharply, though temporarily, lower. Valuations are also on the high side and interest rate rises will likely cause some negative market reaction.
“However, the economy seems to be improving and unemployment getting better. Also, stocks will continue to be attractive in an environment with low yields elsewhere – bonds being particularly unattractive given the possibility of interest rate hikes.”
Hedging like Jason R. Even more analysis than Matt V. Wrong like both.
Prob8 has failed miserably in the past as well, laying off the blame on batteries: “My market predictor must need new batteries. Having now replaced said batteries…” nothing changed.
Still, we love Prob8. An estate attorney he is a regular commentator around here and has become our resident death-taxes-probate-estate planning resource. He even has a guest post on the subject.
Jeremy (Go Curry Cracker):
“I didn’t win?! wtf. This game is totally rigged!
“While my action with the SEC is underway to overturn this horrible injustice, I still find it necessary to enter again this year
“I’ve reviewd my horoscope, verified these numbers against the Fibonacci sequence and Avogadro’s number, and consulted with my deceased ancestors.
“Since I don’t want to rely solely on logical and rational methods, I’ve also studied the current micro and macro economic environment. Hiring is up, prices are deflating, companies are reaping previous years investment at sub zero interest rates, and the developing world is hungry for American products (particularly Oreos and Pop Tarts, but then again, who isn’t?!)”
No need to drag in the SEC or consult your esoteric sources, GCC. Victory can be yours. See my advice to fatchance and think Oreos!
Randellman: “Here’s my picks for 2015… Highly unprobable but just as likely. Happy New Year!”
Highly unprobable and unlikely as it turns out. But Happy New Year to you, R-man, as well!
Keylay: “Has anyone tried averaging all of the previous guesses to see where the average ended up? There’s some evidence that people are good at this type of thing.”
Later Keylay posted again: “Ok, now that I’m sober, I decided to create a little spreadsheet.”
Drunk or sober, averaging or not, spreadsheet or no; Keylay’s poor result is the same.
Frankie’s Girl: “Ha! I was pretty close for the low in 2014… not bad for someone that had absolutely no idea what this strange and scary thing we call the stock market was even a few years ago… (and I no longer find it strange and scary, so yea for me!)”
Ah, you did better when you found it strange and scary. Just sayin’, you know?
Brian: “Why the low? It’s about -6% of today’s close. Why the high? It was a long day and I’m looking forward to retiring by 44 being a reality.”
Hope that retirement doesn’t depend on your market predicting skills there, Brian.
Rockethania: “Why? who knows!”
Who indeed, Rockethania? Other than not you.
MaxTheTerrible: “All numbers above are straight from my in-house developed forecasting machine – the Future Predictor – 1000.
“My proprietary algorithm takes input from tea/coffee non-extractables sedimentation analysis, osseous tissue ballistics, quartz sphere transmission visualization and other proven future-predicting technologies…”
Impressive. Hard to believe it didn’t work Max.
brandon: “Should be easy…” But it wasn’t.
ahonnett: “Basically I tried to do some relatively simple excel modeling based on historic results.
“Then I wasted entirely too much time to continue to tweak my model until it looked reasonable and went with something that I probably should have just swagged to begin with.”
Then there were the latecomers…
Of course, cheating as they did, these players late to the party had no chance of being awarded our fabulous prize. This didn’t keep them from trying. Or from being mocked.
randy: “All of my predictions came from my 4 year old he said these would be good numbers so I am going with these numbers. They can’t be to far off from the talking heads analysis. We will see in Dec how good his predictions are.”
His predictions probably were better than most of the talking heads. But not good enough around here. BTW, how are his being-on-time lessons coming?
Arnold: “I am assuming it will be a down market and just want to do it for the fun of it.”
Well, it was flat not down. But was it fun?
Mrs. HealthyWealth: “It took me a while to respond with the correct numbers since I had to do some serious calculations which I then showed to a psychic.”
May I assume you and your psychic are ready with the correct 2015 numbers now?
David Schmidt: “Although too late to be official, I can still be in on the fun.”
Unfortunately, too late to win too, Dave. Oh. Wait. That’s not going to be a problem, is it?
Benedicte: “Well, I am just a little be late (April!!!) which is going to allow me to be the best at this game.
“Since I am about to invest my fortune in the stock market in one big lump sum, I forecast that the market will just go downhill from there. This should prepare me mentally for that big slump that Jim has told me is gonna come one day or another, whilst at the same time allow me to win that contest!”
I warned him:
“With your late entry, I can’t in good conscience award you our extravagant prize should you win. But I will be happy to heap on the abuse should you be off the mark!”
In return he whined:
“Oh come on, I did not even know you guys existed at the time I was supposed to have given my predictions!”
Too bad you couldn’t have been on time, Benedicte. Your call on the High, off only 14 points, would have tied our winner Tom. Of course you did it with only 2/3rds of the year left.
And how did that unfair advantage help with the other categories?
Well, his Low missed by 321 and his Close, a miserable 496, would have disgraced him even further. Only the hapless Mrs. EconoWiser managed to do worse. But she did play by the rules.
Finally, Ivan chimed in during December (!) predicting some futures trades. You might want to check out some reading comprehension courses there, Ivan.
Enough of the past…
Think you can do better? Maybe, like Mrs. EconoWiser, you have stock fairies talking to you?
Here’s how it works.
In the comments below post up your predictions for the S&P 500. Tell us the high, low and where it will close come December 31, 2016. And put in a line or two as to why so I’ll have something to mock you with when you fail.
You have until the close of trading: 4 pm EST, Friday January 15th.
All in good fun, of course, and knowing this is all just so much nonsense.
That right there is the difference from us here at jlcollinsnh.com and all those TV talking heads. While we’re all making predictions, unlike them, around here we know we’re just talking out of our…
For those of you who were wrong this year, there’s no reason you might not redeem yourself for 2015 if you’ve the courage to try once more. (Actually, there is every reason. But letting that stop you would require good sense.)
For those who did well, let’s see you do it again. I dare ya! Mocking your failure will be even sweeter!
Don’t feel bad. In all likelihood, you’ll get to mock me too. Here is my analysis and my 2016 predictions:
You would have been forgiven if you had gone to bed on January 1, 2015, slept thru the year and woke up on January 1, 2016 thinking nothing had happened during a short nap. I can’t recall a flatter year end result in the markets than this one:
As expected, the media put on the most negative spin possible. No less than the Wall Street Journal ran this headline: US Stocks post worst annual losses since 2008 Really? This is what you come up with for an overall market loss of less than one percent?
The more accurate description? Slightly up, pancake flat:
- S&P -.7% + dividends = up 1.4%
- The tech heavy NASDAQ up 5.7%
But where is the fear in that?
At least they didn’t go with this one:
Nightmare on Wall Street: Will the Blood Bath Continue?
(Worth reading, along with Mr. Market’s Wild Ride, if 2016’s ugly start has you spooked)
Since we are starting 2016 almost precisely where we started 2015, here are my predictions:
- High: 2533
- Low: 1812
- Dec. 31st, 2015: 2471
Astute readers will note these numbers are precisely the same as last year.
Had I been right on a strong positive close for 2015, I would now be expecting a bear during 2016. But I wasn’t. If I’m right this time, and we close up 427 points on the year, I’ll expect that bear in 2017.
We did get the correction I expected, although it came in the Fall instead of the Spring. Along the way, the market absorbed numerous body blows and the resulting volatility. But in the end it was still standing, undiminished.
I think that sets the stage for a another good year. In essence, the same one I predicted for 2015 but even more likely given how well the market has held up to the pressures.
Again, I expect a correction in the 10-15% range, most likely in the first half. In fact, we might be having it right now. (As I write this, the first four trading days have the S&P 500 down ~4.9%) But I don’t expect it will last long.
Gee, reading that it almost sounds like I know what I’m talking about and really can peer into the future. Don’t you believe it. And certainly don’t take any of this too seriously. My crystal ball is just as cloudy as everybody else’s. My owl pellets are just as moldy. My stock fairies just as…
…well, I don’t actually have any stock fairies.
I’m certainly not changing my investment allocation and strategy based on any of this nonsense and you shouldn’t either. As Mr. Rukeyser would gleefully point out, past results are no indication of future performance and even I can be wrong. (Oh boy, can I ever!) We’ll see come next New Year’s Eve.
Finally, thanks for your readership and support of this blog!
May Your 2016 be Healthy, Happy, Free and Prosperous!
And on your journey remember:
“Everything you want is on the other side of fear.”
My profound thanks goes out to reader ael who took it upon himself to tabulate all the entries into an easy to use spreadsheet. He then graciously and without complaint custom tailored it to my finicky specifications. In doing so he removed much of the tedium and time involved in creating this results post, allowing more of my effort to focus on the mocking so dear to my heart.
But then, he made a mistake. He offered his own set of predictions, complete with this rational:
“I printed out the S&P 500 graph, drew some lines and guessed. Sort of a poor man’s simple (ie not multiple) linear regression. It’s just the market timing part that could screw up my otherwise perfect prediction, sort of like a stopped clock being right twice a day. But if I hit them all I’ll expect your full endorsement and promotion for my own, strike while the iron’s hot, rip off the public good, free market entreprenurial consultancy. (I wouldn’t worry too much about this if I were you)”
I worried about it not a whit which, as it happened was one of my better calls for 2015. The results this system of ael’s produced were nothing short of pathetic.
He missed the High by 294, the Low by 112 and the close by 296. Moron.
Oh, and ael, can I count on your help again this year my friend?
Addendum 1: Past contest posts
Past Post Update, January 20, 2016:
Last October I did a post on: Stockchoker.com
Todd just added two cool new features:
- Stock Wars: A tool that allows you to compare the performance of two stocks and/or funds.
- Quizzes: I took both. I’m a “goat” in the first and a “coyote” in the second. You can do better. I dare ya!
On a different note:
The Case Studies are some of my favorite posts and it is always fun when one of our subjects checks in with a follow-up. EmJay did just that this week in his comment to his Case Study from 2013.
- Vanguard.com (unfortunately Vanguard doesn’t have an affiliate program)
- Personal Capital* is a free tool to manage and evaluate your investments. With great visuals you can track your net worth, asset allocation, and portfolio performance, including costs. At a glance you’ll see what’s working and what you might want to change. Here’s my full review.
- Betterment* is my recommendation for hands-off investors who prefer a DIFM (Do It For Me) approach. It is also a great tool for reaching short-term savings goals. Here is my Betterment Review
- YNAB* has the best budgeting tools going and just might be the Best Place to Work Ever
- Republic Wireless* is my $10 a month phone plan. My daughter is in South East Asia and is on the $5 a month plan. We talk whenever can and for however long we please. My RW Review tells you how.
- Tuft & Needle helps me sleep at night. Unfortunately they are no longer an affiliate, but still a very cool company and a great product.
*These are affiliate links and should you chose to do business with them, this blog will earn a small commission.
Unrelated, but here’s what I’m currently or have just finished reading and enjoyed:
If you are interested in income inequality, this poorly titled (should have been Unfettered Capitalism – more accurate and more descriptive) is a great discussion of the pros and cons of our current system. Luttwak clearly has his own biases, but is remarkable evenhanded in presenting both sides.
Written in the late 1990s, it is a bit of a time capsule and fun to see how the past 20 years have actually unfolded.
Leave it to Psmith
“Crime not objected to.”
One of my favorite characters from a favorite author. If you like it, here are two more:
Mike and Psmith
Jack Reacher roams around the country carrying only a folding toothbrush. When his clothes get dirty he buys new ones. Oh, and he kills lots of bad guys. “Make Me” is the most recent in the series, but not the best. That might be this one:
First line: “People do not give it credence that a fourteen-year-old girl could leave home and go off in the wintertime to avenge her father’s blood but it did not seem so strange then, although I will say it did not happen every day.”
Last Line: “This ends my true account of how I avenged Frank Ross’s blood over in the Choctaw Nation when snow was on the ground.”
How we came to be what we are, behave the way we do and believe what we believe. My favorite in this group.
Where people who live to be 100+ live, how they live and what they eat.
Bad monkeys are Sapiens that need killing, and Jane is on the job. If you are already paranoid, you might want to skip chapter: white room (iv)
Why the future might be incredibly good. Unless the grey goo gets us.
This might be the most enlightening and entertaining take on American history I’ve yet to read.
And here are some of my all time favorites:
The book that has most influenced how I live my life.
Deceptively simple, but really all you need to know about becoming wealthy.
Very possibly my all-time favorite novel.
“The Fall of Edward Barnard” is very possibly my all-time favorite short story.
Perfect for the readers of this blog.
“Bartleby the Scrivener” is very possibly my all-time favorite novella. Don’t be put off if you struggled with Melville’s “Moby Dick.” This is a much better and easier read. Plus it will teach you the most important phrase in the English language:
“I would prefer not to.”
*If you click on the books you’ll go to Amazon, an affiliate partner. Should you choose buy them, or anything else while you there, this blog will receive a small commission. This doesn’t affect what you pay.