While I cannot recall ever hearing anybody say that the legendary investment bank of Goldman Sachs was kind or charitable or even decent, I have often heard people say respectful things about the research department of Goldman Sachs. Therefore, I try to follow their research closely. Here are some of their latest expectations:
1. World GDP growth will pickup from 3.2% this year to 3.6% next year. GDP growth in the U.S. will slow slightly from 2.4% this year to 2.3% next year. China will continue to slow from 6.9% this year to 6.4% next year. The Euro-zone will increase from 1.6% to 1.8%, while England will increase from 2.7% to a respectable 3.0%.
2, The S&P 500 will be flat over the next twelve months, while European stocks will rise 6.7% and Japan could rise a whopping 12.3%.
3. Interest rates (10-year) will rise 80 basis points (0.8%) over the next twelve months in both the U.S. and Europe. (I don't believe this.)
4. The dollar will continue to rise, compared to the euro or pound. They expect the euro to breach parity and "break the dollar." Specifically, they expect the euro to drop another 13.6% to only 95 cents. The pound could drop another 5.2%.
5. Commodities will continue to get crushed by the lack of global growth. Gold will drop another 8.1% over the next twelve months. (Don't you know Goldman hates to say avoid gold?) Copper is sometimes called "Dr. Copper" because of its track record in predicting the global economy, and it is expected to drop another 12.4% over the same period.
Interestingly, Goldman believes now is a good time for Buy-Write funds, which are mutual funds that own stocks for growth but also sell call options against those stocks for income. All I can add is -- Amen!
1. World GDP growth will pickup from 3.2% this year to 3.6% next year. GDP growth in the U.S. will slow slightly from 2.4% this year to 2.3% next year. China will continue to slow from 6.9% this year to 6.4% next year. The Euro-zone will increase from 1.6% to 1.8%, while England will increase from 2.7% to a respectable 3.0%.
2, The S&P 500 will be flat over the next twelve months, while European stocks will rise 6.7% and Japan could rise a whopping 12.3%.
3. Interest rates (10-year) will rise 80 basis points (0.8%) over the next twelve months in both the U.S. and Europe. (I don't believe this.)
4. The dollar will continue to rise, compared to the euro or pound. They expect the euro to breach parity and "break the dollar." Specifically, they expect the euro to drop another 13.6% to only 95 cents. The pound could drop another 5.2%.
5. Commodities will continue to get crushed by the lack of global growth. Gold will drop another 8.1% over the next twelve months. (Don't you know Goldman hates to say avoid gold?) Copper is sometimes called "Dr. Copper" because of its track record in predicting the global economy, and it is expected to drop another 12.4% over the same period.
Interestingly, Goldman believes now is a good time for Buy-Write funds, which are mutual funds that own stocks for growth but also sell call options against those stocks for income. All I can add is -- Amen!
