A Look Back at My Magic 8-Ball’s Predictions for 2011

Have you noticed all the end-of-the-year customs that are currently on display almost everywhere you look?

For example, I’ve been inviting my readers to provide questions regarding the future that they’d like to ask my Magic 8-Ball since way back on New Year’s Day 2010.

True, at barely two years old, that could hardly be considered a rich tradition — but every custom has to start sometime, right?

Before you scoff, you should know the 8-ball ended up with an astounding success rate of 70 percent regarding its predictions for 2010.

Yep; seventy percent.

So, how did my Magic 8-ball do with its predictions for 2011? Well, without further ado, here are the surprising results:

Question: Will the government allow married couples to double their deductions across the board and double the income levels for tax rates? (From: Sam at Financial Samurai)
The 8-ball said: It is certain.
What really happened: Married couples everywhere this year took solace after Congress officially extended relief from the so-called marriage tax penalty until 2013.
Nostradamus meter: Correct

Question: Will I win the World Series Of Poker? (From: Sam)
The 8-ball said: Outlook not so good.
What really happened: The 2011 World Series of Poker championship and its $8.72 million grand prize ended up going to Pius Heinz, a 22-year-old German. Sorry, Sam.
Nostradamus meter: Correct

Question: Will the number of new foreclosure filings in 2011 increase over those filed in 2010? (From: Jan at Numbers Made Simple)
The 8-ball said: It is certain.
What really happened: Although the final data has not yet been posted, I strongly suspect 2011 will result in fewer foreclosure filings than in 2010.
Nostradamus meter: Wrong

Question: Will the American housing market recover during 2011? (From: Nelson at Financial Uproar)
The 8-ball said: My reply is no.
What really happened: By virtually any measure, the housing market continued its historic malaise.
Nostradamus meter: Correct

Question: Will Congress address mortgage fraud in 2011? (From: Jennifer at Live Richly)
The 8-ball said: Yes – definitely.
What really happened: Congress did hold hearings on mortgage fraud this year, although there was no major related federal legislation passed into law.
Nostradamus meter: Inconclusive

Question: Will 2011 be a bull market year? (From: Robert at The College Investor)
The 8-ball said: It is certain.
What really happened: The Dow Jones Industrial Average closed out 2010 at 11,577; by the end of last week, it was up over 6 percent at 12,294. Barring a major collapse over the final week, the market will end the year in the black.
Nostradamus meter: Correct

Question: Will the Dow break 13,000? (From: Crystal at Budgeting In the Fun Stuff)
The 8-ball said: Yes – definitely.
What really happened: In 2011, the Dow approached the 13,000 barrier, but never got there — reaching 12,928 before finally pulling back.
Nostradamus meter: Wrong

Question: Will the Leonardo DiCaprio film Inception win five or more Oscars? (From: Regina)
The 8-ball said: My reply is no.
What really happened: Inception was nominated for eight Oscars in 2011 including Best Picture, but, in somewhat of a surprise, the movie ended up winning only four of them: Cinematography, Sound Mixing, Sound Editing, and Visual Effects.
Nostradamus meter: Correct

Question: Will the national unemployment rate fall below 9 percent in 2011? (From: Frank W.)
The 8-ball said: Outlook good.
What really happened: The US government’s official unemployment rate metric fell to 8.6 percent in November.
Nostradamus meter: Correct

Question: Will the national unemployment rate fall below 8.5 percent? (From: Kay Lynn at Bucksome Boomer)
The 8-ball said: My reply is no.
What really happened: The official unemployment rate was exactly 8.5 percent at the end of 2011 — not below. So the 8-ball squeaks by on this one.
Nostradamus meter: Correct

Question: Will the San Diego Padres have a winning season? (From: Kay Lynn)
The 8-ball said: You may rely on it.
What really happened: In 2011 the Padres finished dead last in Major League Baseball’s National League West division with a dismal 71 – 91 record.
Nostradamus meter: Wrong

Question: Will the average price of gasoline in the U.S. top $4 per gallon at any time during 2011? (From: Bella)
The 8-ball said: Very doubtful.
What really happened: In early May, the U.S. average price of gasoline briefly topped the $4 per gallon mark before retreating back below that benchmark.
Nostradamus meter: Wrong

Question: Will the Euro still be around by December? (From: Twenty Something Money)
The 8-ball said: Signs point to yes.
What really happened: Despite all of the turmoil with the troubled Euro, it’s still doggedly hanging around — although at times it seems to be on life support.
Nostradamus meter: Correct

Question: Will the dollar overtake the Euro in value? (From: Candy)
The 8-ball said: Very doubtful.
What really happened: Although well off its high point, one Euro was still valued at $1.30 as of the late December 2011.
Nostradamus meter: Correct

Question: Will gold break $1,600 per ounce? (From: Jennifer at The Finance Buff)
The 8-ball said: It is certain.
What really happened: In early September, gold reached a high point of $1925.
Nostradamus meter: Correct

Question: Will the ten-year Treasury yield go above 4.0 percent? (From: The Finance Buff)
The 8-ball said: Without a doubt.
What really happened: In February, the 10-year note touched 3.7 percent before pulling back; it’s currently sitting in the neighborhood of 2.0 percent.
Nostradamus meter: Wrong

Question: Will Jennifer Aniston announce yet another marriage engagement this year? (From: Pamela)
The 8-ball said: Most likely.
What really happened: Unless Justin Theroux presents her with a ring in the next couple of days, Jennifer Aniston will end 2011 without being engaged. I’m betting he won’t.
Nostradamus meter: Wrong

Question: Will consumer savings rates drop back down to anemic levels in 2011? (From: Sandy at First Gen American)
The 8-ball said: Signs point to yes.
What really happened: The consumer saving rate dropped in 2011 to its lowest level since the recession began. Go figure.
Nostradamus meter: Correct

Question: Will New York or California go bankrupt in 2011? (From: Brad Collins)
The 8-ball said: Most likely.
What really happened: Despite their dire financial situations, neither state has formally filed for bankruptcy.
Nostradamus meter: Wrong

Question: Will student loans be the subject of the next bailout? (From: Greg at Control Your Cash)
The 8-ball said: My sources say no.
What really happened: The key word here is “next.” President Obama announced a student loan bailout plan this past October. However, months earlier, Fannie Mae asked for — and received — another bailout of its own. I know.
Nostradamus meter: Correct

Question: Will financial literacy ever be required to qualify for a government-backed student loan? (From: Leslie Blackston-Favors at The Money Club House)
The 8-ball said: Yes.
What really happened: While there was no sign of this happening in 2011, that does not preclude such requirements from occurring in the future.
Nostradamus meter: Inconclusive

Question: Will Sarah Palin run for President? (From: Sandy at Yes, I Am Cheap)
The 8-ball said: Very doubtful.
What really happened: In early October, Sarah Palin announced she would not run for president.
Nostradamus meter: Correct

So there you have it. Once again, the Magic 8 Ball did a yeoman’s job predicting the events of 2011. Excluding the three questions that are currently listed as inconclusive, the 8-ball correctly answered 13 of 20 queries for a success rate of 65 percent!

Even though that doesn’t beat last year’s 70 percent mark, it’s still impressive.

Overall, the Magic 8-Ball has correctly seen 20 of 30 predictions come to fruition since 2010, for a success rate of 67 percent.

Now Taking Your Questions for 2012

If you have a question you’d like to ask the 8-ball regarding his predictions for 2012 — whether it’s related to personal finance or not — leave a comment below. They’ll be included — along with Magic 8-Ball’s replies, of course — in another article early next week.

As for you skeptics out there, all I can say is never but never underestimate the power of my Magic 8-Ball.

Besides, at least it has a proven track record — unlike those hokey tea leaves and tarot cards.

Photo Credit: bark