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12 Predictions For 2008!

I just looked back at my 2007 predictions and there were some good calls and some very poor ones. Here were the good ones:

Oregon State will break the trend and win the Civil War at Oregon!

In 2007 I predict Gold will trade as high as $850. It closed on Friday, Dec. 29th, 2006 at $636.

In 2007 the USD index will trade at a new all time low of 78. It closed 2006 at 83.43.

Poor predictions:

I predict Oil will trade no higher than $70. It closed on Friday, Dec. 29th, 2006 at $61.05.

I will stick to my 2006 prediction of DJIA 9,000.

War will flair between Iran and the U.S.

There will be a large earthquake on the West Coast of U.S. (above 5.9).

Here are the largest in the U.S. in 2007:

# 2007 12 19 – Andreanof Islands, Aleutian Islands, Alaska – M 7.2
# 2007 10 31 – San Francisco Bay Area, California – M 5.4
# 2007 08 15 – Andreanof Islands, Aleutian Islands, Alaska – M 6.5
# 2007 08 14 – Island of Hawaii, Hawaii – M 5.4
# 2007 08 02 – Andreanof Islands, Aleutian Islands, Alaska – M 6.7
# 2007 05 09 – Offshore Northern California – M 5.2
# 2007 05 08 – Western Montana – M 4.5

It seems the poor ones outnumber the good ones. Not to be deterred, it’s time to venture out on to limb’s end and predict away for 2008:

1. Oregon State will win its third in a row baseball championship.

2. Oregon State will win the civil war again.

3. Gold will hit $1,000 per ounce and silver will hit $20 per ounce.

4. The USD will fall from 77 to 68.

5. Oil will trade at $125.

6. Politics remains the wild card in this election year. Not only do I predict the party’s nominees, but the next president. The odds on favorite has to be Clinton, unless some outside event happens to shake confidence in her ability to lead. On the Republican side, that same event could give us Giuliani, but I’m going with either Fred Thompson or Ron Paul.

7. The Republicans will run the country in 2009.

8. Best Picture for 2007 will be Sweeney Todd.

9. The economy will be in a recession by the end of 2008.

10. The DJIA will trade as low as 11,400.

11. The Middle East war will involve more countries.

12. There will be a large earthquake on the West Coast of U.S. (above 5.9).

2008 Predictions Oregon State Gold Silver Oil Sen. Hillary Clinton Giuliani Fred Thompson

Changes For The Over-65s

The New York Times writes today that

The Equal Employment Opportunity Commission said Wednesday that employers could reduce or eliminate health benefits for retirees when they turn 65 and become eligible for Medicare.

The policy, set forth in a new regulation, allows employers to establish two classes of retirees, with more comprehensive benefits for those under 65 and more limited benefits — or none at all — for those older.

While employers are not required by federal law to provide health benefits to either active or retired workers, we negotiate or agree to employment packages as employees. It seems to me that corporations have found a way to shift the burden of health care from themselves to the taxpayer.

On the other hand, if employers are allowed to discriminate between those over 65 and those under, it would seem to give greater security to older workers and may even make older workers more attractive.

In another landmark deal, I missed the GM/Union deal that took place in September. GM has been at a $25 per hour cost disadvantage with the Japanese car manufacturers, because of health care benefits for retired workers. The Daily Independent wrote that General Motors Corp. won its struggle to unload $51 billion in retiree health costs and improve competitiveness in the latest round of contract talks with the United Auto Workers.

Deutsche Bank auto analyst Rod Lache said the agreement to move retiree health care costs off GM’s books could eventually reduce the labor cost gap by $18 an hour. GM would pay about 70 percent of its obligation, or nearly $36 billion, into the trust, called a Voluntary Employees Beneficiary Association, or VEBA

What’s next, some major change in Social Security?

Health Benefits for Retirees General Motors Corp. (GM) Mover Mike

Opposition Leader Bhutto Assassinated

Mrs. Benazir Bhutto, who the U.S. encouraged to come back to Pakistan from exile, was assassinated first by gunfire then apparently the gunman blew himself up killing at least 20 people.

Death begets death.

Nawaz Sharif, another former premier and leader of a rival opposition party, rushed to the hospital and addressed the crowd.

“Benazir Bhutto was also my sister, and I will be with you to take the revenge for her death,” he said. “Don’t feel alone. I am with you. We will take the revenge on the rulers.”

Mrs. Bhutto was encouraged by the U.S. to reach some kind of political accommodation with President Pervez Musharraf. Now Musharraf will probably resort tighter controls and violence to keep opposition in line. Once again the safety of Pakistan’s nuclear weapons is questioned.

Benazir Bhutto President Pervez Musharraf pakistan

Update:

The |Times on-line speculates on Who killed Benazir Bhutto?

It Pays To Shop!

I’m not sure how stores make money anymore. Sure I know there’s a big mark-up on items, but let me give you a couple of examples of our Christmas shopping.

I already told you that we bought a 42-inch LCD flat screen for $1199 at Video Only. In March, Consumer’s Report rated the brand we bought, JVC, as the best value, their number 1 pick, and it was priced then at $2700.

The week before Christmas, Bev found a Calvin Klein trench coat at Macys, regularly $300 for $150. It was suggested that she put the coat on hold because the next day it might be cheaper. She did and the next day when she returned, she bought it for $65.

On Christmas eve, she and I like to go downtown and shop just for the two of us, maybe even sit on Santa’s lap. I suggested we look at Nine West in Pioneer Place. I knew she was looking for some patent leather boots. We found two pair, one pair that came almost to the knee was $175 marked down to $99 and the other came up over the ankle, was priced at $40. The saleswoman said if we bought both we would get 30% off. I figured quickly that 30% is about the price of the over the ankle shoe. We bought both and the total was about $97. They basically paid us $3 to take the second pair off their hands.

Mish’s Global Economic Trend Analysis reports today that Target is reporting disappointing Christmas sales.

Target Corp (TGT) warned on Monday that its December same-store sales were below expectations and said it now expects sales at stores open at least a year in the range of down 1 percent to up 1 percent, adjusted for a calendar shift.

Is anyone making any money?

Target Corp (TGT) Christmas Sales Mover Mike

Merry Christmas, Happy Holidays

Merry Christmas to the readers of Mover Mike.

May you love others as you would be loved.

Pray for all those who protect us, the firemen and women, the cops, our border patrols and our brave soldiers everywhere.

The Aptera

I’ve been posting ab out new cars from new independent auto companies. Glenn Reynolds today at Instapundit writes about the aptera:

It has a range between charges of 120 miles, goes up to 90 MPH, and gets three hundred miles per gallon.

Come on Detroit. is it really going to take you to 2020 to average 35 miles per gallon.

Aptera Mover Mike

Chrysler, Troubled Company!

If you get a chance, read the Wall Street Journal article Chrysler Faces Financial Pinch, Sees Asset Sales By JOSÉE VALCOURT and NEAL E. BOUDETTE.

At a meeting earlier this month, Chief Executive Robert Nardelli was asked, ‘Are we bankrupt?'” Mr. Nardelli said at the meeting. “Technically, no. Operationally, yes. The only thing that keeps us from going into bankruptcy is the $10 billion investors entrusted us with.”

That’s shocking!

What’s even more shocking, Nardelli drove a different car home each day and then met with the engineers about the flaws like cheap plastic interiors and noisy rides.

Or, He learned that Chrysler badly lags behind on fuel-saving technologies and will have to spend billions to catch up.

Or, Mr. Nardelli was irritated to discover that a program designed to save $250 million to $300 million in parts and other costs was actually saving only $1 million because of rising commodity prices, people familiar with the matter said.

I am rooting for Mr. Nardelli. I have owned a lot of cars in my life, but I have never owned a Chrysler. My father came close when I was living at home. We looked seriously at a red Plymouth with a faux spare tire on the trunk. But in the end, bought a Ford.

I would like to see America continue to manufacture cars, but I think Chrysler, with its many near financial misses is near the end of its string.

This past week, I have posted about Smart, ZENN, Zap-X and MiniC.A.T cars. Why aren’t GM, Ford and Chrysler bringing these to marke?

The Archbishop Of Canterbury Has Spoken

The Archbishop of Canterbury has spoken just in time for Christmas. He said there was no manger, no star, no magi, no donkeys and horses, and no snow falling. Jesus probably wasn’t even born in December, and that virgin birth thing…fahgedaboudit! He didn’t say anything about Santa, the Easter Bunny, Big Foot, the Great Pumpkin or the Tooth Fairy.

Next he’s going to tell us that Jesus, the son of God, did not die on the cross for our sins and the resurrection is a legend, too?

The Archbishop of Canterbury is likely to piss the Big Guy off!

More Bad News From MBIA

The WSJ reports

Confidence in top bond insurer MBIA Inc. plummeted Thursday after the guarantor disclosed on its Web site that it had $8.1 billion in exposure to complex and risky securities backed by home loans.

The $8.1 Billion risky securities are CDOs-squared, which repackage other CDOs and securities linked to subprime mortgages. We are seeing spreads on credit default swap soar to over 570 basis points. “That means it costs $570,000 a year for an investor to protect $10 million in MBIA bonds from default for five years.” Eleven weeks ago the stock of MBIA (MBI) was about $70 per share, Today it broke $20.

MBIA (MBI) CDOs Mover Mike

A Tranche Bites Morgan Stanley !

Morgan Stanley declares a bigger write-off in todays conference call:

…they decided to take this $7.8 billion writedown instead of the estimated $3.7 billion writedown detailed on Nov. 7. “Virtually all writedowns were the result of trading by a single desk in our mortgages business.

Then they say something curious:

Mr. Kelleher details the subprime trading position that caused the losses, saying the firm elected to short the lowest-rated tranche of subprime to the tune of $2 billion, but decided to “cover the cost of negative carry by going long the $14 billion super-senior tranche.” As the value of these positions declined, the company ended losing a ton.

There’s a book, A Demon of Our Own Design written by Richard Bookstaber, a guy that was intimately involved with risk control. He writes that many times the trading desk had it right and management got cold feet and made the traders cut the position or hedge it. Sounds to me that this is what happened at Morgan Stanley and it ended with a writedown of $7.8 Billion!

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