Regarding corporate value, it used to be that capital build a pulp mill or steel furnace, or bridge with an expected life of 40,50 or 100 years.

Nowadays the capital pays for the development of some technology or tool system/process. Even if the product takes off and pays off the development costs, there may be or may not be any "value" there. If you have followed the Michael Dell school of out sourcing, you and your vendors can not withstand any volatility if you are in long term production. Once you stop building them, the engineers and the manufacturing are dismantled, and you would have to start all over again.

The thought is just what does capital invest in inside the US economy?

Is there a litany (one source) where we can get links to the video/audio appearances by Karl in 2010?

I know he's been on Ratigan which I have, then the BlogTalk audios which are easy enough to get. Are there any others? Thanks. If anyone else wants the list, I can post mine, which I think is definitely incomplete at the moment.

There are also a few Max Keiser shows this year as well.

#


# Civil unrest will spread beyond a few demonstrators in Europe. This includes the possibility of unrest in the United States.

The sanitation workers in NY could possibly be the start. People seem to be very upset about their actions, but so far, I have seen no mention in the MSM.

You've got a long series of "not quite yets" -- almost every prediction is a valid yes if you take away timing, but you can't bet on the roulette wheel landing on green "eventually". Still, they're sound predictions and most will come true soon, I don't think anyone doubts that.

The foil is that you can never underestimate stupidity (or malice) -- who'd have thought they'd still be driving the bus at full speed up the hill when everyone onboard is screaming cliffs, and there's a red streak of brake fluid trailing behind. But go figure, when the driver has the oily knife in his hand that cut the lines. It defies believability.

Gen -

Regarding your "Federal Deficit Annualized" chart - my recollection of the Treasury's "Public Debt to the Penny" data is that there hasn't been a "negative deficit" since the Eisenhower administration, and you show one for the year 2000.

They use fiscal years I run calendar...it matters....

I see 2011 and 2012 as two more years of .gov and media lying about the economy.

2013 is when US .gov austerity will begin--too little too late.

Genesis wrote..

They use fiscal years I run calendar...it matters...

Anybody who's made investments knows that "early"="wrong". But such discipline is rarely if EVER used in measuring trends or predictions. That you do speaks volumes about integrity.

I don't think there's much question that more than half the "misses" will be bull's eyes at some near point. But kudos for having the sack to keep the score as tightly as you do.

And congratulations on an incredibly prescient year.

Thanks, Karl, for your insight. I agree on all points, but I'm afraid a couple of your forecasts might be too optimistic. I think we will see 20-25% decline in real estate in 2011, but if Bernanke and Company are able to keep kicking the can for a while longer, this could be premature and your range will prove to be correct. I'm a little more pessimistic, though. Ultimately, I think we have another 30-40% down from current prices before we find the bottom in real estate. And I think the SPX will be well below 1000 by the end of the year. I thought it would happen this year but I was early. I agree with your forecast for a sell-off, a bounce, and then the main event crash, but the timing is the question. I think it happens in 2011 and continues into 2012.

Thank you for sharing your knowledge, insight, and wisdom. Most of us who read this blog daily are better prepared for what's coming than the masses who rely on MSM for the truth. I believe there are severe challenges ahead for all of us, but forewarned is forearmed. God bless.

Working right up to tomorrow evening. Things in the permian basin are popping. Everyone is looking for hands. But experienced hands.
While I see contango, all the Plains, Enterprise and Centurion tank ladders are down. Pipeline companies have been pumping hard since Christmas. Heading the oil to Cushing.
What does this mean? Idunno. But not stacking inventory during contango is odd.
And time will tell what Rockin Rick and the Austin Slicks have in store for us next year. Texas could be in deep kim che by fall.

Quote:

Expect extreme volatility.

I expect this'll be the case and your best prediction until next year when you'll predict double-extreme volatility.

Other than that, most of us are still breathing so we got that going for us.

Oh and btw Karl, Davidowitz and you perhaps could do a 'duet' someday. His comments especially regarding the on-line explosion vs walk-in retail, its impact on CRE, and everything in between, was spot on particularly with regards to implied margin compression and fierce retailer competition for any crumbs left over, will make last year look like Breakfast at Tiffany's.

I think margin compression a bit too soft a term going forward. I'm thinking margin tourniquet or margin strangulation might be better.

http://www.bloomberg.com/video/65589812/

Lastly, your prediction about precious metals, gold specifically, is IMO gonna miss significantly for the simple Econ 101 reason that demand is exceedingly exceeding supply regardless of a bubble connotation.

Hence, this is 'kinda' worded with lots of sloppy wiggle room........

Quote:

Nonetheless, the doomers call of a dollar collapse and gold at $3,000+/oz will be wrong.

The wiggle is what happens in the range from approx. $1,400 to $3,000 and without necessarily due to a dollar collapse. That range is significant, no? Now if you had said, gold will not go higher than $1,650 per Sinclair's mantra, that would be a juevos on the firing line contra-prediction that virulent gold bugs are standing by. Afterall this is whom you're really aiming this at. As it stands your 'prediction' here is IMO nothing of the sort given its vagueness on what exactly you mean quantitatively between today's price and $3,000 - to wit, again anything over $1,650 and the gold bugs 'win'. It's an important distinction as we're talking about commodities (aka real money in some people's lexicon) readily convertible to fiat. However in fairness to you, volatility in FX likely correlates over to volatility in PMs as well which is essentially also what you're saying in context.

..........................

"Folks, please stay in your seats and remain calm. This is your captain speaking, Ben Bernank. We're experiencing a bit of turbulence approaching Washington, D.C. at the moment. Things are completely under control, however as you may have noticed we're starting to run a little behind printing enough money to cover all the free lunches. Preemptively, we will begin a graveyard shift here shortly in order to meet your productive demand. Thank you for flying Bernank Airlines.

Stewardesses, please advise passengers to tighten their belts as we prepare for landing." Hiho

http://www.usdebtclock.org/

What a year. The EU barely hanging on by a thread, the flash crash, mortgage fraud.....I still can't believe the can got kicked all the way to the end of 2010.

Great end-of-year Ticker, Karl. 2011 will be interesting, that's for sure. First up: will Congress raise the debt ceiling, or will the Republicans put a stop to the Great Ponzi?

Happy New Year, everybody!

I greatly look forward to these each year Mr. Denninger. What impresses me the most is that you are willing to flat out admit when you miss a target, rather than trying to obfuscate or weasel-word some justification for how you were "on the mark - from a certain point of view."

Huge + to your credibility in my book. Anybody can make predictions - few will stand by them a year later, and honestly score themselves.

Thanks for this and the ticker as always.

I don't think they'll get it done - the lawyers smell blood and there's too much money to be made taking bites out of some very fat cats. If I'm right there will be at least one burnt offering made - probably BAC - and, if it comes at the wrong time, it won't stop there. If this gets going in the middle of a broad market sell-off Lehman will look like a cake walk.

Unlikely as this again boils down to the ability of the Fed to twist arms to their advantage. The scums at the Fed are pretty adept at this.


I expect an all-on attempt to change The Fed mandate to remove "employment" and possibly define "stable prices."

Unlikely. Both Democrats and Republicans need Fed cover to spend .. we can simply discount their posturing.

You could be getting one wrong.

I think they will continue QE since we have no choice and since Europe is such a dog pile we will get away with it. Neither republicans or dems will choose to cut spending and neither will they raise taxes, There is no deficit cap and no debt cap that matters, as we have seen every time the debt cap gets raised. Now that congress knows there is no bond market to worry about, they will just spend away. My guess is they get away with the 2 trillion deficit.

A big "Thank You" karl

Thanks for the update Karl, and all the analysis you put into your predictions.

FWIW - You got a hit on the drop in housing prices for my community in 2010, and that's being optimistic if I use Zillow, since sales are coming in about $20 - $30k less then Zestimates. This brings my market value officially down to 50% of replacement cost value (and what I paid in Dec 2005).

My county has been "ahead of the curve" for the past few years. LOL! I'll give you a heads up if we ever show signs of recovery ;)

I do agree with the others that what you took misses on will not be fails over the next year.

Tremendous writing... and I will echo the sentiment of many here.. its just a timing thing, as I believe you will double your points very soon. Thank you as always for educating me and the others on here.. I have turned countless people onto your site. More recently some young biz school grads and they get it. The young people in this country need to know the path our "leechership" is taking us down. It will not end pretty as the MATH NEVER LIES! Happy New Year to you and family and all of my new friends here on TF!

Happy New Year, Karl, for you and your family…. This one is for you and your readers….

Giving America "The Business"

http://www.practicalstate.com/?p=4333

Cheers

Alsace: http://www.foreignpolicy.com/articles/20....

Happy New Year, Karl and I wish you good health and happiness in the year to come. Thank you for all your work it is very appreciated.

Bret said

Quote:

I think they will continue QE since we have no choice and since Europe is such a dog pile we will get away with it

They will continue "stealth QE", that is a fact without it the govt would fall apart almost immediately.

Nice.

I agree with most but not with all - but you are probably right.

My Predictions - for the record.

Tim Geithner will not be the Treasury Secretary by Dec 31st 2011. I do not know who they appoint but I would not be surprised to see Volker or Buffet get it. Obama is not stupid and will look populist the next 2 years.

States might get a 1 to 2 year Loan to solve their fiscal problems but it will come with so many strings that most States will force shutdowns of just about everything except essential personnel - this will be to drive home the next point

Some time this year a new National Retirement plan will be introduced and it will become the major issue along with trade and immigration in the 2012 election. This new Retirement Pension will "let you" roll your IRA's, 401K's, into the State, Federal, and Union Pension systems. You will be able to get "guaranteed pensions" backed by the "federal reserve" and some kind of Recovery bond. Of course we all know the real reason is that the States and Unions are in need of large cash contributions to maintain fiscal solvency. This is how the states shed most of their unfunded pension problems.

All of this spending will require QE3 which will surge Oil past 150 per and Gas past 5.00 per Gallon.

I completely agree on the Paul's.

For the 1st time in a very long time - Next Fall fewer students will elect to go to college - instead they will stay at home and try and find odd jobs to help the family out.

At least one other State will follow Arizona in the fight against Illegal Immigrants.

The North K idiot will turn toes up and his son will be just as stupid but not nearly as confident.

Al Queda will strike in the heart of the US again. They will not be as successful as 9-11 however.

There will be at least one "Tim McVeigh, Ruby Ridge, Waco" type of event.

The Shootings at Columbine and Va Tech will be used as inspiration to at least one group of disheartened young people seeing their shot at the American Dream collapse.

Mexico will collapse into Civil War which will force us to finally close the border. We will be asked by the Mexican Government to assist and we will do much like we have in Columbia.

Venezuela will collapse into civil war causing horrible death and destruction - we will immediately send thousand of troops there to help the people stand up against Chavez.

Cuba will start to open.

Russia will cut off Gas to Europe again and this time with nerves of the people already on edge it will cause problems and the former Eastern Block could have a huge problem on their hand - which will cause Germany - along with Merkel's party having horrible election results - to make a stand on bail outs for the rest of the EU. While the EU will not fail - it will be left without Germany in the East and the UK in the West.

Japan, China, Asia, the US, Europe - someone will start the next step in this process by putting up Trade Barriers.

2011 will set up 2012 which will make the Mayan's look like they were the children of the GOD's.

Karl, about regional conflicts, Debka reported that Saudi Arabia has bought at least two nuclear weapons from Pakistan. I think this is true, it is in line with past Saudi actions. It should stabilize the Middle East for a while, as Tehran won't be able to play nuclear blackmail until they have a lot more than two devices. In addition, it probably means Pakistan has stopped actively helping the Iranian nuclear weapon program. It also means Iran will be desperate to speed its program and will be able (or forced) to buy a lot more from North Korea. Depending on how serious the US efforts to stop the NorK nuclear exports are, this could either cool down or heat up the situation in the Korean peninsula.