Monday, January 7, 2019

2019 Prediction Contest - Predictions Are In!

Here are the predictions sorted from highest standard deviation to lowest - most contentious to least. I do not know why anyone thinks that the Democrats will not have a crowded debate stage. At the August 6, 2015 Republican debate, there were 10 candidates on the main stage and 7 on the undercard. It was not until the 6th debate that Republicans had fewer than a dozen candidates debating.


SD
* Any member of Congress posts a video “twerking” (or similar) at the Capitol or in a Congressional building. 33%
* Any of the Democratic presidential debates in 2019 has 12 or more candidates appearing (including undercard). 32%
* A year with no commercial jet aircraft fatal plane incidents. 27%
* Federal Reserve bank balance sheet total assets declines to below $4 trillion. 25%
* Tesla gets a going concern warning, has its auditor resign, or Musk is arrested, indicted, leaves the company, or is fired. 24%
* TSLA share price goes below $200 at any point. 24%
* USDJPY below 100 at any point during the year. 22%
* A primary challenger to Donald Trump emerges and polls higher than 10%. 22%
* The 13-week T-bill yield ($IRX) ends the year below 2%. 21%
* The most current 13F as of 12/31/19 of the Swiss National Bank shows a balance below $45 billion of equities. 21%
* The 10 year Treasury yield rises above the 2018 high yield of 3.24% at any time during the year. 21%
* The CBOE Volatility Index ($VIX) exceeds 40 at any time during the year. 21%
* The 13-week T-bill yield ($IRX) exceeds 2.5% at any time during the year. 20%
* Any of GE, JCP, or FTR file for bankruptcy protection or propose a restructuring where existing equity will receive less than 10%. 20%
* A tropical cyclone makes the list of 10 wettest on the U.S. Mainland (for the third year in a row). 20%
* Federal Reserve lowers target rate any times (in 25bps equivalents) in 2019. 20%
* Total return of 1 year T-bill outperforms S&P 500, Nasdaq, and bitcoin for the year. 19%
* The BBB yield closes above 5% at any time during the year. 19%
* Federal Reserve raises target rate two times (in 25bps equivalents) in 2019. 19%
* Hussman's fund (HSGFX) is up for the entire year including dividends. 18%
* The S&P has a one day percentage increase greater than 7.5%. 18%
* A Category 3 hurricane makes landfall in the continental U.S (for the third year in a row). 18%
* None of Uber, Lyft, Slack, Pinterest, Robin Hood, or Palantir complete an IPO or direct list their shares. 18%
* The S&P has a one day percentage decline greater than 7.5%. 18%
* The 20+ year Treasury ETF (TLT) has a positive price return (not including dividends) for the year. 18%
* Crude (WTIC) trades above the 2018 high of $76.90 at any time during the year. 18%
* One or more of Macron, Trudeau, or Erdogan loses power (dies, resigns, or is deposed). 18%
* The S&P goes below 2,000 at any time during the year. 18%
* One or more of Kim/Merkel/Saudis loses power (dies, resigns, or is deposed). 17%
* Buying equal dollar basket of FB/AAPL/NFLX/GOOGL returns below 0% for the year (including dividends). 17%
* One or more of Gross/Ackman/Miller/Hussman/Einhorn/Berkowitz leaves asset management in any manner. 17%
* The Vanguard Balanced Index Fund (VBINX, 60/40) has a positive return for the year. 17%
* A 2 year treasury yields more than 10 year Treasury at any time during the year. 17%
* An earthquake of magnitude 7.5 or greater affects the continental United States. 16%
* Donald Trump pardons anyone prosecuted by the Special Counsel. 16%
* Another Supreme Court seat opens. 16%
* A Decacorn (nonpublic company, peak valuation >$10 billion) is uncovered as a fraud. 16%
* The S&P Retail ETF (XRT) outperforms Amazon for the year. 15%
* Any of the following countries' 10-year government bonds yield more than US at end of year: Germany, Italy, Canada. 15%
* The USD/RMB exchange rate goes over 8 at any time during the year. 15%
* Gold trades below $1000/oz at any time during the year. 14%
* Global negative yielding debt goes under $1 trillion at any time during the year. 14%
* A Euro hits $1 US. (EURUSD parity) at any time during the year. 14%
* Gold trades above $2000/oz at any time during the year. 14%
* Jerome Powell is no longer Fed Chairman on 12/31/19. 14%
* The CBOE Volatility Index ($VIX) exceeds its 2008 record of 89.53 at any time during the year. 13%
* 2019 US vehicle sales (autos and light trucks/SUVs) are lower than 2018 vehicle sales. 13%
* USDJPY above 130 at any point during the year. 12%
* The S&P goes above 3,000 at any time during the year. 11%
* Donald Trump is still President of the United States at the end of the year. 11%
* Pelosi is no longer the Speaker of House as of 12/31/19. 10%
* Federal Reserve bank balance sheet total assets increase to above $5 trillion. 10%
* Trump announces that he won't run again in 2020. 10%
* The 10 year Treasury yield falls below the July 6, 2016 low of 1.336% at any time during the year. 9%
* Twitter is taken private. 9%
* Any country leaves the Euro currency. 9%
* Either Buffett or Munger dies. 9%
* A players' strike occurs in any of the four major US sports leagues (NBA, NFL, MLB, NHL). 9%
* The Flippening: Etherium market cap is greater than Bitcoin (core/classic) at any time during the year. 8%
* Any sort of #MeToo allegation is made against Warren Buffett in a mainstream newspaper. 7%
* Western Canadian Select trades at a premium to WTI at any time during the year. 6%
* Cryptocurrency combined market cap on Coinmarketcap.com exceeds $1 trillion at any time during the year. 6%
* Crude (WTIC) falls below the “modern” low of $26.05 at any time during the year. 5%
* The S&P has its largest one day percentage decline in history (bigger than 10/19/87 of 20.5%). 5%
* US ends daylight savings time. 3%
* Musk's “Boring Company” is revealed to be digging tunnels to smuggle drugs into the United States. 3%
* A nuclear weapon is used in anger. 2%


And here are the probabilities with the events sorted from most likely to least likely. Compared to last year's consensus, the likelihood of Trump finishing the year as President has fallen from 91% to 85%.

Prediction Average
* Donald Trump is still President of the United States at the end of the year. 85%
* 2019 US vehicle sales (autos and light trucks/SUVs) are lower than 2018 vehicle sales. 65%
* The CBOE Volatility Index ($VIX) exceeds 40 at any time during the year. 63%
* A 2 year treasury yields more than 10 year Treasury at any time during the year. 61%
* TSLA share price goes below $200 at any point. 57%
* Federal Reserve bank balance sheet total assets declines to below $4 trillion. 57%
* A primary challenger to Donald Trump emerges and polls higher than 10%. 54%
* Any of the Democratic presidential debates in 2019 has 12 or more candidates appearing (including undercard). 53%
* The 13-week T-bill yield ($IRX) exceeds 2.5% at any time during the year. 53%
* Federal Reserve raises target rate two times (in 25bps equivalents) in 2019. 53%
* A Category 3 hurricane makes landfall in the continental U.S (for the third year in a row). 53%
* The BBB yield closes above 5% at any time during the year. 52%
* Buying equal dollar basket of FB/AAPL/NFLX/GOOGL returns below 0% for the year (including dividends). 49%
* The Vanguard Balanced Index Fund (VBINX, 60/40) has a positive return for the year. 47%
* The S&P Retail ETF (XRT) outperforms Amazon for the year. 44%
* Any of GE, JCP, or FTR file for bankruptcy protection or propose a restructuring where existing equity will receive less than 10%. 44%
* A year with no commercial jet aircraft fatal plane incidents. 42%
* Hussman's fund (HSGFX) is up for the entire year including dividends. 42%
* The 20+ year Treasury ETF (TLT) has a positive price return (not including dividends) for the year. 42%
* Tesla gets a going concern warning, has its auditor resign, or Musk is arrested, indicted, leaves the company, or is fired. 39%
* The S&P goes below 2,000 at any time during the year. 39%
* Total return of 1 year T-bill outperforms S&P 500, Nasdaq, and bitcoin for the year. 39%
* The 10 year Treasury yield rises above the 2018 high yield of 3.24% at any time during the year. 35%
* A tropical cyclone makes the list of 10 wettest on the U.S. Mainland (for the third year in a row). 33%
* One or more of Gross/Ackman/Miller/Hussman/Einhorn/Berkowitz leaves asset management in any manner. 31%
* USDJPY below 100 at any point during the year. 31%
* Any of the following countries' 10-year government bonds yield more than US at end of year: Germany, Italy, Canada. 31%
* Donald Trump pardons anyone prosecuted by the Special Counsel. 31%
* One or more of Macron, Trudeau, or Erdogan loses power (dies, resigns, or is deposed). 29%
* Another Supreme Court seat opens. 29%
* One or more of Kim/Merkel/Saudis loses power (dies, resigns, or is deposed). 27%
* Either Buffett or Munger dies. 26%
* The USD/RMB exchange rate goes over 8 at any time during the year. 26%
* Any member of Congress posts a video “twerking” (or similar) at the Capitol or in a Congressional building. 26%
* The 13-week T-bill yield ($IRX) ends the year below 2%. 26%
* The most current 13F as of 12/31/19 of the Swiss National Bank shows a balance below $45 billion of equities. 26%
* A Euro hits $1 US. (EURUSD parity) at any time during the year. 25%
* Crude (WTIC) trades above the 2018 high of $76.90 at any time during the year. 24%
* Federal Reserve lowers target rate any times (in 25bps equivalents) in 2019. 21%
* A Decacorn (nonpublic company, peak valuation >$10 billion) is uncovered as a fraud. 21%
* Global negative yielding debt goes under $1 trillion at any time during the year. 20%
* None of Uber, Lyft, Slack, Pinterest, Robin Hood, or Palantir complete an IPO or direct list their shares. 20%
* The S&P goes above 3,000 at any time during the year. 20%
* The S&P has a one day percentage decline greater than 7.5%. 19%
* Trump announces that he won't run again in 2020. 17%
* Jerome Powell is no longer Fed Chairman on 12/31/19. 17%
* Gold trades below $1000/oz at any time during the year. 16%
* The S&P has a one day percentage increase greater than 7.5%. 16%
* USDJPY above 130 at any point during the year. 14%
* Gold trades above $2000/oz at any time during the year. 13%
* The CBOE Volatility Index ($VIX) exceeds its 2008 record of 89.53 at any time during the year. 13%
* Any country leaves the Euro currency. 13%
* Pelosi is no longer the Speaker of House as of 12/31/19. 13%
* An earthquake of magnitude 7.5 or greater affects the continental United States. 12%
* The 10 year Treasury yield falls below the July 6, 2016 low of 1.336% at any time during the year. 11%
* Twitter is taken private. 11%
* Federal Reserve bank balance sheet total assets increase to above $5 trillion. 10%
* The Flippening: Etherium market cap is greater than Bitcoin (core/classic) at any time during the year. 9%
* A players' strike occurs in any of the four major US sports leagues (NBA, NFL, MLB, NHL). 9%
* Crude (WTIC) falls below the “modern” low of $26.05 at any time during the year. 8%
* Any sort of #MeToo allegation is made against Warren Buffett in a mainstream newspaper. 7%
* Western Canadian Select trades at a premium to WTI at any time during the year. 6%
* The S&P has its largest one day percentage decline in history (bigger than 10/19/87 of 20.5%). 5%
* Cryptocurrency combined market cap on Coinmarketcap.com exceeds $1 trillion at any time during the year. 4%
* US ends daylight savings time. 3%
* Musk's “Boring Company” is revealed to be digging tunnels to smuggle drugs into the United States. 1%
* A nuclear weapon is used in anger. 1%

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