Top Ten Predictions for 2016

There is something about the dawning of a new year that reveals the Nostradamus hidden in many of us.  Everyone from political pundits to economists weigh in with forecasts and predictions for the upcoming 12 months.  Most prognosis turn out to be erroneous, but thankfully, quickly forgotten.

If he were alive today, Nostradamus might be amused by the number of imitators who issue prognostications.  In his day, the 16th century French philosopher, who studied astrology and various occult sciences, had few disciples.  It wasn't until after his death that he found fame.

Claims have been made over the years by ardent apostles that Nostradamus predicted everything from the rise of Adolph Hitler to the assassination of President John F. Kennedy in the more than 6,338 prophecies he penned in a number of volumes.

Unlike the prolific Frenchman, these annual predictions will be limited to ten.  However, in the spirit of Nostradamus, this year we confess to using unscientific tools, such as Ouija boards, crystal balls, hallucinogenic mushrooms and a spiritual seance, to aid in the prophecies.

1. After a long bull run, the Dow comes thudding down as rising interest rates, a strong dollar, the spiraling junk bond crisis and a soft global economy weigh on U.S. stocks.   The Dow finishes at 16,600 after another roller coaster year, exacerbated by an all too familiar tech bubble. Without the Federal Reserve propping up the market, stocks suddenly look pricey causing investors to flee for the exits.

2. For the eleventh straight year, the country's Gross Domestic Product (GDP) under performs, finishing at 2.4 percent.  U.S. economic growth has not reached the 3.0 percent benchmark for a robust economy since 2005, the longest swoon in the modern era. A strengthening dollar, slower demand for resources and global economic weakness, especially in China, will undermine America's economic comeback.

3. The Federal Reserve raises interest rates by 0.25 points in the first quarter of the new year, but then drops plans to increase the key standard any further because economic signals are flashing yellow.  By year's end, the Fed rate is 0.50 percent instead of the 1% chairwoman Janet Yellen had predicted. The anemic stock market also weighs on the Fed's decision.

4. With smartphone penetration levels rising to all-time highs, the big manufacturers, like Apple and Samsung, branch out into new businesses.  Competition and price-cutting squeeze margins, leading the major players to launch a buying spree.  Apple, with $200 billion in cash, will make a key acquisition to advance its goal of dominating the self-driving automobile market.

5. After years of dashed hopes and 413 unsuccessful clinical trials, a promising new drug appears on the market to slow the signs of Alzheimer's disease. There are 93 drugs currently in the pipeline as pharmaceutical firms invest millions in research to capture the mushrooming market created by the aging of America.  An estimated $226 billion was spent in 2015 for the care of Alzheimer's patients.

6. State-sponsored cyber attacks reach epidemic proportions, culminating with an attack on a power substation that shuts down electricity to an American city.  After years of warnings about the vulnerability of the nation's electric grid, the power disruption finally mobilizes the industry to harden their systems against cyber terrorist threats.

7. Crude oil prices briefly rise after the holiday driving spike, but the cost of a barrel ends the year at below $42.  Excessive stockpiles of crude oil, OPEC's increased production and booming U.S. oil exports produce a worldwide glut that keeps average annual prices at the pump below $2.05 per gallon.  Big oil companies begin lay-offs as profits slump and their stock prices tumble.

8. President Obama issues an executive order aimed at making it harder for Americans to purchase guns with stricter background checks and bans on some weapons, fueling a Second Amendment fight that goes all the way to the Supreme Court.  Mr. Obama's directive thrusts gun control to the front as an issue in the presidential election.

9. Iran is accused of breaking the nuclear agreement it signed by secretly increasing its supply of centrifuges and building a second underground facility.  President Obama demands the Iranians open their facilities to inspectors, but its leaders stall and equivocate. Meanwhile, Israel warns it will destroy the nuclear facilities if the world fails to act.  Russia threatens to retaliate for any attack on Iran.

10. The presidential race comes down to Democrat Hillary Clinton versus Republican Ted Cruz.   Donald Trump's lack of a strong field operation hurts turnout for the billionaire in the Super Tuesday primaries, forcing him to reconsider his candidacy.  With a superior organization, Cruz outlasts the field to win the Republican primary.  He picks North Carolina governor Nikki Haley as his running mate. Clinton opts for former San Antonio Mayor Julian Castro.  After a nick-and-tuck electoral battle, Cruz emerges the victor by the narrowest of margins, but the GOP loses its majority in the Senate.

Like Nostradamus, your scribe may be a few years off on some of these predictions.  But at sometime in the future, they are bound to prove correct.  It is called the law of averages, the best friend of any prognosticator.