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dpdoor (43.13)

just my crazy predictions for 09

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December 23, 2008 – Comments (3)

Since it’s late and no one is going to read this I just want to put my predictions for 09 in my blog. I think that Jan 7 is the last day of low prices till the next major upset. I think July will be above 10500 and the sideliners will finally get in and cause a bubble and bust. In between we will have some up and down as we try to figure out if congress will cut loose with money. There will be some friction over Obama's decisions especial if he does not help a certain group that he promised would be represent by a certain person in a very high political office. Other decision that may not go well is when he has to spend billions in ways the average person can not understand. He really needs to start educating the public on what worked in the great depression and what didn’t. He needs a massive PR campaign. We could see some real agitation in our society as people conflict over policies and who gets what. I think Ford is going to kick a.. They are going to dominate.

Corning will dive to $7 or maybe $5. and they will see $11. Bank of America won’t see their lowest again and will see 17 and I hope for 20. Law suites against Country wide will be a big issue. The home builders wont get the bail out but Auto will get what they need (you can’t replace gm but anyone can build a house). Car sells will be up and what gets us exited way before home sells do.

3 Comments – Post Your Own

#1) On December 23, 2008 at 4:18 AM, DaretothREdux (44.98) wrote:

Toyota has already replaced GM.

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#2) On December 23, 2008 at 12:42 PM, mysoftballcoach (55.91) wrote:

Some bold predictions.  Kudos for laying them out there.  Regarding BofA, I don't believe they have yet seen their bottom.  There was a nice piece on CNBC this morning regarding a 2nd wave of mortgage mess (I believe they were discussing the Alt-A loans).  Thus far, BofA had marked their Alt-A loans down 20%, but every other bank and marked them down 30%.  Meaning, BofA has another 10% negative mark coming up on their portfolio.  Therefore, the odds are strong that BofA will take greater write downs than other banks in the next earnings release.  So not only another big write down, but more than likely a bigger write down than their peers will be taking.

Further, in regard to Banking in general, it's going to be a bloody year for small banks.  Look for 50-150 Banks to be closed by the FDIC in 2009.  Currently there are 187 Banks on the FDIC watch list.  BofA will NOT be one that closes thanks to the "Too Big To Fail" theory, but the news regarding banks will be down-beaten and therefore will work against BofA.

On the whole, BofA will end 2009 with a higher share price than where it is now.  I just think it has some pain to go through when it reports earnings next Q.

Here's a little tip just from Coach, I was a Bank Liquidation Specialist for the FDIC from 1986 through 1996 (the last Banking fiasco).  You should check the stock charts for BOA and WFC for the period 86-96.  Both increased their stock price by 600%.  WFC increased their dividend by 600% and BOA increased their dividend by 400%.

Here's another little FYI just for you, recently the FDIC called me to see if I would come back.  They have a busy agenda for 2009 and need people with my experience.  I will be buying stock in both banks and possibly JPM and C, prior to accepting their offer.  I'm allowed to own the stock, if purchased prior to employment, and just disclose my position, but after employment I would be precluded from purchasing bank stocks.

With all of that said, you of course need to do your own due diligence.  And past performance is no guarantee of future performance.

Good Luck.

Coach

 

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#3) On December 23, 2008 at 7:30 PM, dpdoor (43.13) wrote:

Thanks Coach, Usually people get upset with my predictions, even though I am fairly close in the long run. Now I did say B of A would not pass its low ($10) but boy it's getting close.

Thank you very much for the insight. Good luck with the FDIC I am sure they could use you.

Got to show you the Oct blog excerpt… Nov 7 the following Monday will be the start of a decline to 6,700. After the panic it will come back to 8500 and will average there for a long time. What’s you bet. [it only went to 7600 but my crystal ball was a little foggy that day]

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