It’s become a New Year’s ritual to predict what will happen in the upcoming year. This is not as simple as it seems to be, and most people who stick their necks out have their heads handed to them.
Over the years, the reputations of countless people have been ruined because they made the wrong market call, picked the losing team in an important sports event, or chose the defeated candidate in a political race.
Still, New Year’s Day has just passed, and this year we decided to join those fearless warriors who throw caution to the winds and tell the world what we really think. So after a few minutes of peering into our crystal ball, the upcoming events became clearer. We’re happy to share them with readers. Bear in mind, there’s no investment advice here, just some good, old-fashioned fun. With that said, here goes.
Election Day Surprise?
Every election is hard fought and important, particularly Presidential elections. And that goes especially for this year, when the most important issue to be decided is the soul of America. This much is certain: Neither side will go down quietly.
The issues appear to favor Republicans. In foreign policy, America is losing its standing. The Houthis and other Iranian proxies are taking potshots at American targets, European allies and the US are not as united as they once were, more countries are joining BRICS, and tensions with Russia and China are at their peak.
The economy also favors Republicans. 60% of the population lacks the funds to deal with a $1,000 emergency, America’s debt and deficits are all but out of control, bankruptcies are soaring, personal debt is at an all-time high, and allies who’ve always held US dollars are looking for an alternative.
Given what’s at stake, this election will be the most expensive, bitter, and ruthless one in history – regardless of whom the candidates are. There will be at least one write-in candidate whose objective will be not to win but rather to siphon off enough votes from a major candidate and cause him/her to lose.
This election will be super close – even closer than 2016 and 2020. And for the first time, the winner will be determined not just by the issues or endorsements, but by AI. Considering how divided the country is, neither side will accept defeat easily and regardless of which party wins, we may very well see rioting in the streets the day after the election. And with so many people furious at how events are unfolding, don’t be surprised if a few candidates throw out extreme and very controversial policies.
Oil: Still A Slippery Business
Like all commodities, the price of oil fluctuates. In September, the price rose to $94/barrel and analysts predicted it would continue to rally. Their first target was $107 then $115; at least one predicted the price would reach $150.
Since then, oil has declined to a more affordable $74/barrel. But don’t start singing “Happy Days Are Here Again,” because a sharp upward spiral may be coming up ahead and fast. A spike in oil would drive up both inflation and interest rates, put the banks under renewed pressure, and deliver a jolt to the economy – the last thing the it needs now.
There are several scenarios that could drive oil dramatically higher, but the one that stands out is more Houthi attacks. The Houthis, Iranian proxies, have been attacking the Saudis and others for a long time. When the war with Hamas began, they turned their sights on commercial vessels owned or doing business with Israel and attacked some with drones and missiles.
It’s not only Israel feeling the effects; so, too, is the global economy. Shippers have to send their vessels around Africa to avoid attack and that’s costing a lot more money, creating shipping delays, and causing insurance costs to skyrocket. Those costs will of course be passed along to consumers.
By the way, the Houthis are not some primitive, rag-tag gang that can’t shoot straight. They have a modern and well-stocked arsenal that includes drones, missiles, anti-ship ballistic missiles, and the like. And they control the strategic Bab el-Mandeb Straits. According to Reuters, about 12% of the world’s shipping passes through this waterway, including 8.2 million barrels of oil daily.
The US and allies sent the Houthis what’s described as a “final warning” to stop attacking shipping on the Red Sea. The Houthis responded by unleashing a new weapon: a drone boat packed with explosives.
The White House has acknowledged that higher shipping costs could hurt the US economy. As 20 nations signed onto that warning it’s obvious that they believe that their economies would be affected also.
The stage in 2024 has been set for higher inflation, supply shortages, and wider conflict. So far, the markets haven’t taken these into account. But this could change very soon.
Will Gold Glitter In 2024?
Investors trust gold because it retains its value during inflation. There’s an even better reason: central banks, which control the world’s money, keep buying more of it. According to market commentator Lena Petrova, their purchases started increasing in early 2021 and have been gaining momentum ever since then. The World Gold Council said that their third quarter purchases have far exceeded their five-year averages.
Gold reached an all-time high of $2114/ounce in December. According to the World Gold Council, government reserves have increased by more than 800 tons through the end of the third quarter alone, beating forecasts by a wide margin. Central banks continued their buying spree in the fourth quarter.
With so many governments buying so much gold, with its continued use in jewelry and other industrial applications, and with its ongoing popularity with investors and speculators, the question is not why gold recently made a high, but why the price isn’t even higher.
J.P. Morgan once said that “Gold is money. Everything else is credit.” With increasing skepticism about the soundness of the dollar and other fiat currencies, gold (and silver) could very well sparkle in 2024. We may even see some fiat currencies backed by gold.
Sources: airandseaforces.com; leanpetrova.com; poplarreport.com; zerohedge.com
Gerald Harris is a financial and feature writer. Gerald can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it.
