Happy new year, readers! Like last year, Iâm kicking off the start of 2011 with more fearless predictions from my old friend, the magic 8 ball.
In case you missed it, my magic 8 ball ended 2010 with an astounding 70 percent success rate. Letâs see your Ouija board try to top that!
With such terrific results, weâve got a lot of questions this year from readers eager to get an accurate glimpse into the future, so letâs get right to it, shall we?
Itâs only right that we start off this yearâs predictions with two questions from one of the 8 ballâs biggest fans, Financial Samurai, who asks:
Q: Will the government allow married couples to double their deductions across the board and double the income levels for tax rates?
A: It is certain.
Frankly, although I like the idea, I find the 8 ballâs prediction here to be a bit of a stretch. Itâs nice to see the 8-ball going against the conventional wisdom though. Sam also asked the 8 ball a personal question:
Q: Will I win the World Series Of Poker?
A: Outlook not so good.
Uh oh. The ball calls them as he sees them. Perhaps itâs not too late to get your $10,000 entrance fee back, Sam.
Our next question comes from Jan at Numbers Made Simple:
Q: Will the number of new foreclosure filings in 2011 increase over those filed in 2010?
A: It is certain.
Thatâs certainly not good news, but I have to agree with the 8-ball here. In a closely-related question, the anonymous blogger from Financial Uproar wants to know:
Q: Will the American housing market recover during 2011? (Hopefully the 8 ball says yes, this cold Canadian sure wouldnt mind a place in sunny Phoenix!)
A: Without a doubt.
Huh? Hey 8 Ball, while that is good news for Financial Uproar, do you really think itâs possible for the housing economy to recover in 2011 despite your predicted increase in the number of foreclosure filings?
A: Concentrate and ask again.
Okay; do you really think itâs possible for the housing economy to recover in 2011 despite your predicted increase in the number of foreclosure filings?
A: My reply is no.
So should I throw this question out?
A: My reply is no.
Do you realize youâre repeating yourself now?
A: Yes.
Before we move to another topic, I see weâve got one last real estate question from Jennifer Barry who writes at her blog, Live Richly:
Q: Will Congress address mortgage fraud in 2011?
A: Yes â definitely.
Okay. If you plan on committing mortgage fraud in 2011 you better do it now, before Congress finally does something about it.
We had a couple questions regarding the stock market in 2011. The first question comes from Robert over at The College Investor, who is dying to know the answer to this question:
Q: Will 2011 be a bull market year?
A: It is certain.
More good news for 2011! Letâs get a little more specific then with this question from one of my biggest fans, Crystal from Budgeting In the Fun Stuff:
Q: Will the Dow break 13,000?
A: Reply hazy â try again.
You heard the question, Ball: Dow. 13,000?
A: Yes â definitely.
Okay! It looks like the ball thinks the economy will be on a real roll in 2011; I guess the extension of the Bush tax cuts will cheer the market.
Moving away from money topics for a second, Regina asks:
Q: Will the Leonardo DiCaprio film Inception win five or more Oscars in 2011?
A: My reply is no.
Hmm. Iâm more than just a bit shocked with that answer, 8 Ball. After all, Inception was on a lot of peopleâs lists as the best movie of 2010. Arenât you a big fan of Leonardo DiCaprio?
A: It is decidedly so.
So can I then assume that the plot was too confusing for you?
A: Without a doubt.
Fair enough. That whole plot-within-a-plot-within-a-plot thing really was a bit distracting. Weâll see if youâre right.
Naturally, the national unemployment rate continues to be on a lot of peopleâs minds. Frank W. asks:
Q: Will the national unemployment rate fall below 9 percent in 2011?
A: Outlook good.
Fantastic. Meanwhile, in a follow-up question, Kay Lynn from Bucksome Boomer wants to know:
Q: Will the national unemployment rate fall below 8.5 percent?
A: My reply is no.
Okay. Maybe we shouldnât get too greedy, but at least itâs good to know that we can expect those ugly unemployment numbers to finally start turning around in 2011. Kay Lynn also couldnât help but ask:
Q: Will the San Diego Padres have a winning season?
A: You may rely on it.
Crap. As a die-hard fan of the Los Angeles Dodgers, that is not very good news.
Another big question most people are interested in is the price of gasoline. One of my loyal readers, Bella, asks:
Q: Will the average price of gasoline in the US top $4 per gallon at any time during 2011?
A: Very doubtful.
Meanwhile, why am I not surprised that my good friend, Dr. Dean, from the Millionaire Nurse Blog asked the following burning question:
Q: Will Obamacare be stalled or altered by the House Republicans?
A: Cannot predict now.
What? Sheesh. Oh well, it looks like the 8 ball doesnât want any part of that question for 2011. Weâll just have to wait and see, Dr. Dean.
A couple readers were interested in the euro. For example, Twenty Something Money askedâŠ
Q: Will the Euro still be around by December?
⊠and Candy wanted the 8 ball to answer this question:
Q: Will the dollar overtake the Euro in value?
To which the 8 ball replied, in order:
A: Signs point to yes.
A: Very doubtful.
Interesting. If we are to believe the 8 ball, it looks like now is not the time to be shorting the euro. I think I agree that the demise of the euro is not around the corner. However, I think mounting debt woes in Europe are going to drag the Euro down in 2011 to near-parity with the dollar. Weâll see who is eventually right.
The Finance Buff had two hard-core money questions of his own that canât be answered over at CNBC:
Q: Will gold break $1,600 per ounce?
Q: Will the ten-year Treasury yield go above 4.0 percent?
A: It is certain.
A: Without a doubt.
Reading between the lines, it looks like the 8 ball is predicting higher inflation for 2011. I agree.
Switching gears again, reader Pamela is curious about Jennifer Anistonâs love life:
Q: Will Jennifer Aniston announce yet another marriage engagement this year?
A: Most likely.
I know I wouldnât be surprised. The only question is to whom?
Jenna from Adaptu wants to know:
Q: Will energy efficient products continue to receive tax credits in 2011?
A: Cannot predict now.
Thatâs too bad, 8 Ball, because Congress extended into 2011 a modified version of the 2010 tax credit for energy efficient appliances at the end of December. Talk about a big swing and a miss! Jenna tossed you a big fat softball and you blew it.
And the questions keep on coming. First Gen American:
Q: Will consumer savings rates drop back down to anemic levels in 2011?
A: Signs point to yes.
From Brad Collins:
Q: Will New York or California go bankrupt in 2011?
A: Most likely.
And from Leslie Blackston-Favors at The Money Club House:
Q: Will financial literacy ever be required to qualify for a government-backed student loan?
A: Yes.
Meanwhile, in a related question, Greg from Control Your Cash wants to know:
Q: Will student loans be the subject of the next bailout?
A: My sources say no.
Which begs the question, 8 Ball, just who are your sources?
A: Ask again later.
Alright. Remind me when we get back together at the end of the year to see how you did with all these predictions.
Finally, Sandy from Yes, I Am Cheap wants to know:
Q: Will Sarah I-Couldnt-Finish-My-One-Term-As-A-Governor Palin run for President?
A: Very doubtful.
I think youâre dead wrong on this one, 8 Ball. Say, do you think Sandy might decide to send a little money to the Palin campaign if youâre prediction ultimately falls flat?
A: Donât count on it.
If you say so.
Will Lenâs column be featured in the Wall Street Journal or NY Times?
It is certain.
Will Len modify the Tweet This url shortener that splits the destination url into both Amazon and his webpage.
It is certain.
Maybe the 8-Ball is afraid of retaliation by the Feds. Witness protection may be in order.
If you need to ship it to an undisclosed location, let me know.
@Coach: Regarding your first question, I sincerely doubt it. Thanks for pointing out the Amazon link issue⊠When I updated the plugin, it defaulted to the Amazon ad option â which I have since shut off.
@Dr.Dean: LOL Thanks for the offer! If I decide to ship off 8 Ball, Iâll send you an encrypted transmission with all the details.
Thanks for the shout out, link and answer! Magic 8 Ball better step up his game for next year!
Hi Len: Thanks for asking the 8 Ball about financial literacy becoming a requirement someday for getting a government student loan. Do you think the âyesâ reply means weâll have fewer lawyers and doctors and more plumbers and hair stylists in the future?
And you got 70% right last year!? Amazing! Canât wait to see in this year will be that successful again.
A 70% correct prediction rate is nothing to sneeze at! That makes it much more accurate than Bernanke. đ
I hope Congress does address mortgage fraud, and in fact, the government starts to take the crimes committed by bankers seriously. When I watched the documentary âInside Job,â the writer pointed out that thousands of people went to jail for contributing to the Savings and Loan crisis. For this last crisis, weâve only seen a handful of prosecutions.