Economic forecasting: week 1 2010.
Posted on 06. Jan, 2010 by scott in economic daydreaming
Up to now, the first week of 2010 has been a real improvement over the first week of 2009. So far, in just three days of trading, the DOW is up 145 points or about 1.3%. According to ‘tradition’ this bodes well for the rest of the year.
However, I believe everything about the first week will depend solely on the unemployment numbers that come out on Friday. If they are good then the market will take a significant further bounce and the first week will end on a high note (predicting a good year, remember). If they are bad then I believe Friday will end with a distinct tumble downward in the DOW . . . and investor confidence will follow.
I am feeling confident about what our great country is doing right now and so I am going to make two very imp0rtant predictions of a short-term nature.
The first is that the unemployment numbers will actually be ‘employment’ numbers. I believe that December will show job growth of around 50,000 jobs. Further I believe that November’s numbers will be revised upward from the 11,000 jobs lost to a positive number of about 20,000 jobs gained. Remember that economics is an art not a science and so a 25-50% range in the above numbers is okay.
These job numbers will have a real influence on markets Friday and so I am also predicting (the second one promised above) that Friday the DOW will jump more than 100 points on the good news and set a multi-year high of around 10,700!
I hesitate to make these kind of predictions but I really do believe there is a sumani confluence of factors (record low interest rates, good holiday retail numbers, strong tailwinds in markets, and others as well as . . . real job creation.
It will be fun to see what happens in just two days . . . there aren’t may economists who would support my views right now . . . but short-term predictions are the most fun because they are so quickly proven right or wrong.
Chastise me if it is the latter . . . but send me your congratulations if I am right and take that as congratulations for you too (and our great country)!
thanks to flickr’s ethan bloch
Honors and Recognitions
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