How’d I Do?02.27.2013
With this in mind, let’s review my fearless predictions for 2012 made on these very pages in January 2012, and dole out some grades.
The U.S. stock market will have a reasonably steady 2012 with no major incidents or meltdowns, and end the year up in the order of 15-20%.
The Standard & Poor’s 500 generated a total return of 16% in 2012.
This was my best prediction. The number was spot-on in my range, and it was in fact a reasonably steady year in the market with none of the major incidents or meltdowns that had occurred in previous years.
But, I must concede that my prediction implied more bullishness than was actually seen in too-quiet 2012, so I lose points there.
President Obama will win re-election.
Calling a win for the incumbent isn’t exactly going out on a limb, but Obama was running about even with Republican front-runner Mitt Romney at the time, so I got this coin toss right.
A second Obama term will be more business-and market-friendly.
Obama’s second four-year term didn’t even start until January 20, so I have to take an Incomplete grade on this one. I do believe very-early indications show some promise, as the President recently has shown a willingness to compromise with Republicans and engage business leaders more. But time will tell.
Financial regulation will be less of a factor than is commonly expected.
This prediction is a bit squishy to assess, as both the factor and the underlying expectations are subjective measures. And there’s also a substantial lack of finality to this, making any assessment all the more tricky. I will say that my main point was that new regs wouldn’t be the onerous burden that some market participants seemed to expect, and I think this view has held true so far.
Exchange consolidation will continue in some way, shape, or form.
This was probably my second-best prediction, as one year ago Deutsche Borse’s proposed acquisition of NYSE Euronext was teetering on the brink of derailment, the latest in a string of failed exchange mergers.
Not much happened on this front—at least in a high-profile way—until December 2012, when IntercontinentalExchange said it would buy NYSE Euronext for $8.2 billion.
Granted I didn’t exactly go out on a limb with this call, rather it represented the distillation of knowledge I get from the many smart people I speak with on a regular basis. But it’s nice to be able to say I nailed it.
The New York Giants will win the Super Bowl.
Okay, this one’s not as impressive as it sounds, as it was made a week before the game, when the Giants and the New England Patriots were the only two teams left standing. But like the Obama re-election call, I got this coin toss right, which sure beats getting it wrong.
I give my predictions a B grade overall, maaaayyybe a B+. My prognostication showed enough to beat a C, but there wasn’t enough ‘oomph’ or contrarianism to warrant an A. I do derive some personal gratification from making some decent calls when others didn’t do as well: “Almost All of Wall Street Got 2012 Markets Calls Wrong,” blared a Bloomberg headline from January 4, 2013.
But I think I’ll take this year off from the prediction business—rather, in the spirit of our bimonthly magazine, perhaps I’ll resolve to make predictions biannually.