This post is a continuation of Predictions Part I. Here are more big changes that I see coming.
I should point out that based my past experience, my crytal ball tends to be premature. Therefore, 2017 may be to aggressive of a timeframe. This is not a hedge against being wrong about my prediction, but rather a warning to investors and a reminder to myself that timing of investments is important, and often requires patience, not to mention the need to wait for signs to support taking a position.
While Trump has been battling it out with Obama, House Speaker Paul Ryan has been very aggressively preparing action plans, called "A Better Way" and building support among his Republican and Conservative constituents. The ground work laid by Ryan will prove invaluable in aiding the new President's administration to hit the ground running.
As far as timing goes, markets respond to signals extremely fast. Even more so today, as a result of the speed at which news and other information travels. For gains to be gotten one has to have the courage of their convictions. It is extremely difficult to beat the news, and once it is in the news it is more often than not, already in the market. That is what makes good foresight, vision, and frankly good predictions valuable. So with that said, lets get to my next set of predictions.
Prediction #6:
Derugulation will unleash new competition, which in turn will encourage greater innovation, new choices, and lower costs. One area we will see the benefits is in health care. Among them, changes at the FDA translate in to new drugs and cures. Look for benefits in other industries including education, affordable housing, energy, etc.
Prediction #7:
Welcome to improved relations with Russia. Much has been made of Trumps cozy additute towards Putin, and Putin's alledged prefence for Trump. Almost all the opinions on this subject have been negatitive. I have long seem positive benefits from what I foresee to be a restart of American-Russian relations. I expect Trump's meetings with Putin to happen very early in his Presidency and for it to produce very positive results. I anticipate rapid and tangible actions on both parties parts. Fears will ease. Sanctions will ease. Cooperation will rise. Economies will rise. Living standards in Russia will rise, along with the Russian people's affection for Trump. Trump will be cheered in the streets of Moscow. And Putin will be happy to endorse it. A new era of trade and better relations with Moscow will dawn. All of which will highlight the failures of the Obama administration's and Hillary's foreign-affairs policies. Benefits will spill over and give us greater leverage in negotiations with other nations as well present oppotunities for shifts in our defense strategies, which in turn will reduce threats and allow us to reallocate some defense assets.
Couple this with Trump pressuring many NATO countries to pay a fairer share of their own national defense. Some will chose to contribute to USA defense support, and others will invest more directly in their own military. Either way, this trend will contribute to the financial resource that the USA has to increase the quality of our own defense forces, as well as sales to USA defense contractors.
Prediction #8:
Some manufacturing comes home. Just as much NEW manufacturing starts here. Between the political pressure, reduced regulations, advances in AI and automation, and the growth of the USA economy will all play a part in influencing business leaders decisions to either bring some manufacturing back to the USA and/or not to leave in the first place. Lower Corporate taxes and taxes on repatriating cash will result in USA companies with overseas cash to bring some of those dollars home in order to invest them in the USA. Not all dollars will come back - as American entities use some of that cash to invest overseas.
Prediction #9:
Energy independence is a game changer. By taping all energy options from nuclear, to coal, to natural gas, oil, wind, solar, geo-thermal ... you name it, the potential for USA to become energy independent is in sight. The implications are broad and far reaching. From defense, to stimulus, to jobs, holding down the cost of living, and other benefits, energy independence will reap profound benefits. The losers will be OPEC. All of this is good for Israel! Isn't that nice!
Prediction #10:
Philanthropy is the new favorite place for wealth to go. Political action has had the most attention for quite a while. With the baby boomers retiring and passing away, the desire to influence politics will be less attractive than the desire to heal the world and leave future generations with a better world. Plus, older people are more apt to think about their legacy. Some will desire to find cures for illnesses that they worry may be in the genetic future of their children and grandchildren. As the economy strengthens and even greater wealth accumulates, people will also have a greater means to be generous.
Prediction #11:
The oceans are the greatest frontier on the planet. From new species, findings that will lead to medical discoveries, lost civilizations, amazing natural resources, environmental implications, and more, the potential to be found in our oceans is immeasurable.
BONUS Prediction:
Artificial Intelligence (AI), from the likes of IBM Watson and Nvidia, and others, give America an enormous edge in this field. Impacts to nearly every aspect of life on planet earth are huge and easy to under estimate.
