Friday, 17 October 2008
End of week: Predictions Results
Last Sunday I posted my thoughts on what I though would be a pretty chaotic week in the world economy; got that bit right. below are last week's predictions and in highlights the actual results:
- RBS. Barclays & Lloyds/HBOS will announce taking of the Governments' shilling before the markets open tomorrow. Despite the huge knock to dividends, this will temporarily support their share prices. The CEO of RBS will resign.
RBS has held up, LLoyds HBOS not so well, they may come back a bit if the Government allows Dividend payments within 5 years. Fred the Shred did resign. Prediction Accuracy - 50%
2- The markets will continue their downward trend as more bad news seeps out into reality. Perhaps not with the vigour of this past week and with a bear rally for a day or two, but downwards nonetheless. Lehmans fall-out will be main bad news to financials sector.
It was a nice Bear Rally, but unless the markets are up over 5% (currently 3%) by the end of Friday then my prediction was spot on. Lehmans fall out will be next week, post 21/10. Prediction accuracy - 90%
3- After the failure of the Sarkozy talks today (prediction), the Euro will weaken further against the dollar and pound. Serious questions will begin to be asked about its viability.
The talks succeeded by the standards of European agreements, but the Euro has fallen heavily. Prediction accuracy: 50%
4- Commodity sell off will continue, as will gold and silver to some extent as margin calls for big traders continue to force liquidation of assets. Maybe some respite by Friday, Oil will end the week under $70 unless OPEC cut production.
Commodities wrecked, oil at $66 a barrel. Gold ans Silver routed too. Prediction Accuracy: 100%
5- Questions will being to be asked of the strength of some UK Insurers as they are battered by huge markdowns to their assets; similar with large pension fund companies like BA and BT.
Insurers are down a lot this week indeed, RSA and Aviva more than the market average, L&G too. This was the front page story on the Telegraph today. BA and BT held up not so badly after last weeks decimation, but are still nearly off hugely. BA is 50% down on a MONTH ago and is heavily shorted.
Prediction Accuracy 100%
Overall Success - 78%. Do you agree?