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Doug Kass crazy surprises for 2022

Espaço dedicado a todo o tipo de troca de impressões sobre os mercados financeiros e ao que possa condicionar o desempenho dos mesmos.

Doug Kass crazy surprises for 2022

por BearManBull » 25/12/2022 3:21

1. The Deteriorating Health of Both Biden and Trump Becomes The Biggest Surprise of The Year - The Irony Is That It Will Likely Lead to Another Trump/Clinton Presidential Race in 2024!

President Biden becomes sufficiently incapacitated such that President Harris becomes the first female President of the United States. She immediately becomes, in effect, a lame duck president and has no significant successful legislative accomplishments over the next year. Leaked stories of abusive temper tantrums in the Oval Office make headlines.

Both Vladimir Putin and Xi Jinping immediately put Harris to the test with a series of foreign policy crises - and she proves to be not up to the task.

The November mid-term elections result in a landslide for the Republicans, who take the Senate and win a sizeable majority in the House of Representatives.

Speaker Pelosi retires from Congress.

Meanwhile, Donald Trump also becomes ill and announces he will not run for President in 2024.

This creates a wide open field for the nomination in both parties.

In mid-2022, Republican Nikki Haley announces that she will run for president and assumes the (defacto) mantle of her party's leadership and takes a strong lead for the 2024 Republican Presidential nomination.

Leading Democrats speak out and encourage Hilary Clinton to run, again. Though she remains publicly uncommitted, she is clearly very interested, and, according to numerous sources is seriously considering a run.

Privately, the former president, Donald Trump, lobbies, postures and grooms his daughter, Ivanka, to run for President.

Almost overnight, when his/her political ambition is revealed, Ivanka Trump takes a significant lead over Haley as her father's supporters quickly return in force.

In a speedy response to the Ivanka Trump declaration, Clinton announces her plan to seek the Democratic Presidential nomination.

The stage is thus set for another Trump/Clinton Presidential contest in 2024!

2. Powell Turns Hawkish - But Monetary Policy Fails to Dent Rising Inflation

Despite accelerated tapering and an attempt to signal slow and steady rate hikes, inflation accelerates well beyond expectations. By February inflation is running close to 8%. Though comparisons are tough, inflation stays well above consensus expectations (sticking at above 5% this summer).

ESG investing, the complete reopening of the global economy and rising geopolitical tensions sends oil to over $110 a barrel.

While Omicron proves far less virulent than initially feared, business closures put in place and uncertainties serve to exacerbate the supply chain dislocations seen in 2021. The continued logistical mess reinforces more (cost push) inflation and mounting inflationary expectations.

The U.S. labor shortage intensifies and wages grow +6%. The shift from "goods to services" demand post Covid actually causes more inflation as, surprisingly, service prices accelerate across the board.

"Slugflation" (sluggish growth and sustained inflation), a distant cousin to "stagflation," becomes a feature and commonly used term in 2022.

As interest rates increase (in the U.S. and in Europe), the rising higher debt burdens in the financial system - which have clearly institutionalized instability - lead to a new regime of equity market volatility rarely seen in modern investment history. Daily moves in the S&P Index of 2%-3% become commonplace.

The housing shortage worsens, as labor shortages limit home construction and homes for rent companies buy whatever supply they find. Home prices go up by another 15%. Eventually, the high prices for everything will begin to impact affordability and demand, as consumers can't afford to maintain consumption when interest rates ratchet higher later in the year.

The Fed is left in an impossible position of finally realizing it needs to get "serious" about inflation into a slowing economy.

Powell realizes he should have let Lael Brainard have the job.

Treasury Secretary Yellen, recognizing that inflation is materially widening the wealth and income gap (by acting as a regressive tax) encourages Powell to do "whatever it takes" to stop inflation.

Whip Inflation Now (WIN) buttons are distributed nationally.

Powell ends up more Volcker-like than anyone predicted. The Fed Chair turns very hawkish and focuses on inflation - not jobs or stocks. But it is too late and the monetary pivot fails to materially reduce an elevated level inflation as years of monetary excesses are not easily reversed.

In 2022 we learn that there is no monetary policy that remedies the inflationary impact of continued global supply chain and logistical disruptions and imbalances.

3. After an Early Year Rally to New Highs, The Stock Market Rolls Over

The "innovations" stocks that performed poorly in 2021, all but collapse in 2022 ( (ARKK) trades under $70/share - and that is the best performing ETF in Cathie Woods' universe!). The fallout expands to venture capital, where liquidity tightens.

As private and public companies realize they need to tighten their belts, spending on ads on Meta (FB) , Alphabet (GOOGL) and Amazon (AMZN) declines. The tech mega caps suffer a significand de-rating.

The loss of speculative monies expands into crypto and NFT's, which suffer large draw downs.

Beeple's $69 million digital painting is resold for $10 million at Sotheby's (with Beeple being the only bidder!)

Later in the year, with the economy slowing in response to higher inflation and the Fed tightening more aggressively than anticipated, a full bear market ensues - taking the S&P down 30% from its early year highs.

4. Jeff Bezos and Elon Musk Battle It Out to See Who Can Set The Record for Biggest Loss of Personal Fortune in a Single Year

Amazon runs into trouble with higher labor and shipping costs, declining ad sales and slowing demand for AWS.

Elon Musk over celebrates being named Time's "Person of the Year" and winds up hospitalized after a drug overdose.

Tesla's shipments and market share are adversely impacted by a host of competitive EV offerings from domestic and non U.S. manufacturers.

EVs lose their luster and appeal as it becomes clear that the electric grid is nowhere near ready for a mass switch... nor is your home. (Try charging and running a major appliance at the same time).

(GM) and (F) shares also falter as their transformation and execution into the EV market is questioned by investors.

5. Value Stocks Materially Outperform Growth Stocks

Shockingly, AT&T outperforms a faltering "The Nifty Seven" (Facebook, Amazon, Apple, Google, Netflix, Nvidia and Microsoft)!

6. Berkshire Hathaway, With Over $150 Billion in Cash Goes On a Late Year Shopping Spree and Buys or Rescues 2-3 S&P 500 Companies

In the bear market in the last half of the year, Berkshire's common advances 25% and is one of the five best performing companies in the S&P 500.

7. China's Economy Worsens Relative to Even Low Current Expectations

As the engine of global growth, China pulls down world trade and the world's economy.

Accelerating property weakness, excessive debt, negative demographics and political leadership intent on reigning in the accumulation of wealth in public companies all contribute to the much worse than expected downturn in gross domestic production.

With China's political leadership in jeopardy - and, in order to maintain popularity/position (through diversion) - Xi Jinping initiates military confrontations on two fronts. (See Surprise #1)

8. The SAFE Banking Act Finally Passes and Cannabis Stocks Surge After Uplistings on the NYSE

Two of the largest five multi-state cannabis operators merge in an effort to become the dominant cannabis brand in the U.S.

A third, large multi-state operator is acquired by a well known U.S. packaged goods company.

The largest cannabis ETF ( (MSOS) ) doubles in 2022.

9. Robinhood Is a Casualty of the Bear Market and Is Sold to JPMorgan For Only $2/share (the same price initially bid for Bear Stearns)

10. In a Heated Bidding War With Amazon, Apple Acquires ViacomCBS for $55/share (in stock) - Dwarfing the Previously Largest ($3 billion) Acquisition by Apple of Beats In 2014.

11. More High Profile Wall Street Names Are Exposed in The Epstein Probe

12. Precious Metals FINALLY Have Their Day!

Silver becomes the new meme stock. The Silver ETF ( (SLV) ) briefly rises to over $35/share.

13. Turkey's Economy Collapses and Erdogan Is Assassinated or Overthrown - Its New Central Bank Head Raises Interest Rates and The Lira Rallies Back Under 10 and Turkey's Economy Starts to Recover

Turkey's stock market is among the best performing in the world.

14. One Fatal Space Accident Serves to Halt Space Tourism in Its Track for a While

Virgin Galactic Holdings ( (SPCE) ) trades under $5/share.

15. Israel Takes Military Action Against Iran

What little is left of global harmony is upended and 2022 is a year characterized by heightened and expanding geopolitical tensions on three continents.


1. The Deteriorating Health of Both Biden and Trump Becomes The Biggest Surprise of The Year - The Irony Is That It Will Likely Lead to Another Trump/Clinton Presidential Race in 2024! Wrong

2. Powell Turns Hawkish - But Monetary Policy Fails to Dent Rising Inflation Correct

3. After an Early Year Rally to New Highs, The Stock Market Rolls Over Correct

4. Jeff Bezos and Elon Musk Battle It Out to See Who Can Set The Record for Biggest Loss of Personal Fortune in a Single Year Correct

5. Value Stocks Materially Outperform Growth Stocks Correct

6. Berkshire Hathaway, With Over $150 Billion in Cash Goes On a Late Year Shopping Spree and Buys or Rescues 2-3 S&P 500 Companies Wrong

7. China's Economy Worsens Relative to Even Low Current Expectations Correct

8. The SAFE Banking Act Finally Passes and Cannabis Stocks Surge After Uplistings on the NYSE Wrong

9. Robinhood Is a Casualty of the Bear Market and Is Sold to JPMorgan For Only $2/share (the same price initially bid for Bear Stearns) Wrong

10. In a Heated Bidding War With Amazon, Apple Acquires ViacomCBS for $55/share (in stock) - Dwarfing the Previously Largest ($3 billion) Acquisition by Apple of Beats In 2014. Wrong

11. More High Profile Wall Street Names Are Exposed in The Epstein Probe Wrong

12. Precious Metals FINALLY Have Their Day! Wrong

13. Turkey's Economy Collapses and Erdogan Is Assassinated or Overthrown - Its New Central Bank Head Raises Interest Rates and The Lira Rallies Back Under 10 and Turkey's Economy Starts to Recover Wrong

14. One Fatal Space Accident Serves to Halt Space Tourism in Its Track for a While Wrong

15. Israel Takes Military Action Against Iran Wrong

Começou bem mas depois descambou.

Interessante que a guerra na Ucrânia lhe passou completamente ao lado.
“It is not the strongest of the species that survives, nor the most intelligent, but rather the one most adaptable to change.”
― Leon C. Megginson
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