My Predictions for 2022

My Predictions for 2022

Predictions are hard but necessary. But it is the only way to keep ourselves in check. Myself included. No exceptions. So today I will go over my five predictions for 2022 and three predictions for this decade.

So without further ado [drumroll please 🥁] Here are my top predictions for 2022:

An economic crisis outside of the U.S.

For years, I've believed that the U.S. is no longer the center of the world. Which means the next economic collapse will not happen in America. But we may feel the ripple effect. In the 90s, we had the Mexican Peso Crisis (1994), the Asian Crisis (1997) and Russian Crisis (1998) during our boom years.

This year I expect something to topple in Asia. Southeast Asia. Maybe Taiwan.

Inflation will raise the floor

Everything is increasing in price. And it’s here to stay. We’ve been in a low inflationary environment for too long. Plus the Federal Reserve printed too much money.

Take a look at the price of milk today. I bet it’ll be up +30% in the next twelve months.

The Federal will further distort the markets [rising rates]

Always one step behind, we’ll find the government attempting to raise rates this spring. They have several motives to do this soon.

First, they need to clean up their balance sheet by reducing debt and interest payments. Second, they need to combat inflation. I bet government officials find out the CPI is mispriced and their actions further increase inflationary fears.

Rising rates will blow up one mega business

The U.S. is still the financial capital of the world. But as we begin to raise rates, it will have a ripple effect on every sector. Especially ones that are overlevered. My bet is that a few micro bubbles will pop. Evergrande in China is only the beginning. One or two financial centers will be bailed out in Asia for bad debt.

There will be a massive interest in natural resources

Climate change is a hot topic but can be misconstrued. The discussion is more about natural resources than the change in the weather.

This year we will find oil, minerals and other natural resources will become more valuable. Yes, more valuable. Especially natural resources like nickel and lithium which are necessary for electric vehicles. Between battery storage and semiconductors, these markets will have a supply/demand imbalance.

P.S. today China controls most of the rare metals like lithium, cobalt and nickel.

My Decade Trades

  • Biotechnology has enough funding and momentum for multiple breakthroughs
  • The crypto winter may be here but it has built the foundation for a better internet
  • We will see massive onshoring of U.S. manufacturing to increase jobs and global trade

Also stagnation is a high possibility this decade. Lower growth is on the horizon combined with higher inflation.

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