Monday, February 01, 2016

World Outlook Conference 2016

I attended the World Outlook Conference on Saturday Jan 29 and found it interesting. There were the usually types of vendors you find at this event selling products and investments -- lots of real estate equity or hard real estate type of developments.

One of the most interesting items were to listen to some of the prognostications for the coming year. Briefly, here are some of the themes:

- Oil (moderately bullish going forward - rebalance in the supply and demand)
- Gold (possibly more downside, then some rallies)
- Sovereign Debt (this is a big one, no upward movement in interest rates, but rather large defaults)
- So called "Sin" stocks

Overall, one could say they were not too bullish about markets but continue to see turmoil ahead (that's not hard to infer), but besides some of the obvious, there were a few presenters who had some interesting things to say.

One of the most intriguing and controversial was Martin Armstrong, an economist who has developed an computer cycles calculation that predicts some rough sailing in the next few years. It was interesting because of the methodology he uses which purports to use natural cycles to predict a series of confluence events. The back history of dates that the model predicts seems to have co-incided with a number of significant economic moments -- 1987 crash, 1989 Nikkei high, event he 2007 US housing bubble and deleveraging.

The link can be found at Armstrong Economics

This is an interesting topic that is at odds with the randomness of market events. The confluence of different cycles is apparently what creates market randomness. When looked at from a master cycle called the Economic Confidence Model, different cycles line up and therefore different events can be predicted.

However, it also may be fitting events to specific cycle dates which then look as it was obvious to predict in retrospect. A little curve fitting of event data? Hard to say. I will need to read a little more about this. It was entertaining, if not scary, to follow some of this through.

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