Wednesday, 30 December 2015

The Annual Prediction Game: the world is STILL getting better. Mostly.

Electorates across the rich world are losing the plot, and increasingly backing utter numpties all over the place. Mostly, the likes of Trump, Le Pen and Corbyn will not win elections, and sanity will prevail. The last 6 years have seen middle-class wages stagnate in the rich world and voting for these populist goons is a way express dissatisfaction with this fact. Meanwhile, the global poor continue to get better off. 

2015 saw a continued decline in the number of people in absolute poverty, who struggle to get adequate calories to survive. Fewer than 10% now live on less than a $1.90 a day, down from 36% in 1990. 1990, by the way is the year the world started to abandon the idiotic economic shibboleths of socialism and embraced markets. It's not even clear in-country inequality is rising in the westAnyone who says "the rich get richer, while the poor get poorer" under capitalism, is simply wrong. 

Even the rise of populist politics in the west can be seen as a symptom of success. In previous generations, semi-educated morons would be too busy surviving to have opinions, and nor would they have any means to express them. Should morons express themselves, educated people would have had the confidence to ignore them. Now morons not only have opinions, and a means to express them, but they expect to be taken seriously! Worse, educated people, who are usually achingly tolerant, have internalised the idea that all opinions are equally valid, while being ashamed of their status. The morons' great yawp of disatisfaction mouthed by the likes of Farage and Trump will, however, pass as successful economies resume stuffing their fat mouths with bread and circuses, and the Morons stop listening to politicians again, even ones that stroke their prejudices. 

Corbyn is a slightly different phenomenon: here an antediluvian trot has taken advantage of a disorientating defeat, and been swept on a wave of unusual unity from the hard-left to capture Labour. Young, ignorant pillocks, who don't remember the piles of corpses and devastated economies left behind by Socialism, have flocked to his banner. Moral certainty, and so the nice-sounding homilies of socialism poison a new generation. 

Democracy means playing whack-a-mole with bad ideas, and this dispiriting process has sucked the confidence out of the West. Without an enemy with which to contrast ourselves, we've rightly turned to solving problems within. But this focussing on our problems has given many the impression there are fundamental flaws in our society, and created a yearning for certainties. Hence the support, on both the idiot left of Corbyn and the Trump/Farage moron right, for the likes of Putin. 

The return of real wage growth will see off the populists in a way rational argument won't. If they're getting richer, people will stick with the status quo.

War has taken more lives in 2015 globally  than in the previous few years. We have spent the peace dividend following the defeat of the Soviet Union. But Russia is re-arming, China is starting to throw its weight around, and the Middle-East is in flames, and so the West must pull together and re-arm too. Although Fukuyama's "end of history" was widely derided, we have acted for 25 years as if he was right. The free west needs to rediscover its confidence, and start asserting itself again. Democracy's march has slowed. Dictators have learned to manage the process. Idiot socialism is coming back. Whatever the faults of our society, the free-market liberal democracy remains the best, freest society yet devised, and we should be confident in our moral righteousness, when facing down our enemies, domestic or foreign.

Si vis pacem, para bellum.

Last year's predictions were as follows:
  • I think 2015 will be the year the FTSE breaks 7000. One day it will, one day I will be right.
  • Oil will fall to $40, and maybe below and stabilise in the $40-60 range. USA becomes the world's swing producer
  • The Conservatives will win a thin majority in GE2015. There maybe 2 elections. Don't ask me how. no polling backs this up. But the country doesn't want Miliband, and Cameron's actually done a pretty good job under difficult conditions and doesn't deserve to be sacked. UKIP to win 3-5 seats, Farage to fail in Thanet, the party's national vote share in the 10-12% range.
  • China's growth over the past few years will prove to have been overstated. China's slowdown to get worse. India to continue to develop rapidly. Modi proving his critics wrong: He may be the man to get India working and taking its rightful place as a major economic power.
  • Russia will try to save whatever face it can for Putin, as it withdraws from Ukraine in response to the falling oil price and continued sanctions. Russia will be set up to rejoin the world financial system in 2016.
  • IS will be reduced to a rump by the end of the year, as having been stopped in their tracks on a number of fronts, they will find the supply of jihadis will dry up.
  • Darfur will be the international flash-point to watch
How did I do?
  • The FTSE did break 7,000 and then collapsed. 1
  • Bang on the money about Oil 1
  • Bang on the money about the election, though I overstated UKIP's seats. 1
  • Bang on the money about China and India 1
  • I under-estimated Putin's willingness to make his people suffer for his grandiose designs, though the Ukraine ceasefire is mostly holding 1
  • Perhaps over-optimistic about ISIL's defeat, but they are certainly in retreat. 1/2
  • Not sure a great deal happened in Darfur, indeed it seems to be quietly solving its problems. 0
5.5/7 ain't bad! And looking forward:
  • The FTSE 100 will recover lost ground, and make a new high in 2016. Oil will remain below $60 for the foreseeable future.
  • Inflation will remain low, and there will not be an interest rate rise in the UK until at least the 2nd half of 2016, and probably not until 2017.
  • The UK will vote to stay in the EU, and do so relatively comfortably.
  • Trump will not be the Republican nominee, but it doesn't matter. Hillary Clinton will be the Next president. However ghastly she is, the GOP is going through the same existential madness that is currently gripping the Labour party in the UK. Hell, given the current bunch of twat-o-matic onanists vying for the Republican nomination, I'd probably have to vote for her.
  • Corbyn will remain leader of Labour through 2016, and will poll in the mid 20s by the end of the year. 
  • Labour will start losing MPs to defections and a small chance of a formal split in the party.
  • We've seen peak UKIP: I estimate a 25% chance of Douglas Carswell resigning the whip in protest at 'KIPpers being mostly ghastly pillocks with horrific views.
  • ISIL will continue to be degraded, and continue to lose ground to various forces. Putin will continue to prop up Assad, and Syria will become increasingly binary, as Russian and Regime forces grind down all (non-ISIL) opposition to the regime. 
  • It is likely the west will grudgingly accept Assad's part in the post war Syria.
  • It is possible 2016 could be the year of the QSD, a Arab League and US-backed coalition of (mostly) non-jihadi, democratic (ish) Syrian groups.
  • The conflict in Ukraine will remain frozen, Putin's aim being a nation with an open sore, which cannot therefore join NATO or the EU.
  • If the last decade was China's, the coming one looks like it may be India's. India is just too corrupt and chaotic to manage 'big bang' development by government fiat, but China's getting old before it got rich, and there is *a lot* of mal-investment to purge. China's economy will weaken sharply in 2016.
  • India's rise may be more sustainable, as it will have to be driven from the bottom up. India's growth rate will be higher than China's (largely fictitious numbers) again in 2016.



4 comments:

Simon Jester said...

"The UK will vote to stay in the EU, and do so relatively comfortably."

(I thought this used to allow blockquotes, but now I'm getting 'Tag is not allowed: BLOCKQUOTE'.)

Reasonably certain that Dave will hold the referendum in 2016, then?

I seem to recall (perhaps incorrectly) you previously saying that he would take whatever the EU would give him in negotiations and declare victory; so far, they haven't given him anything, as far as I can see. Do you think they will give him some kind of token, or are you convinced that "In" will still win without any concessions from the EU?

Jackart said...

Cameron wants to get it out of the way, so yes, 2016. My view of the EU is that I dislike it, and it's institutions, but on balance, we're probably better off in. And Now is not the time to start breaking up European clubs with the rise of Putin's russia and so forth. Cameron is asking for the wrong things: Free movement is the one thing I value in the EU. Now we're safely not in the Euro, the fact is, I don't care. Almost no-one does, apart from extremely noisy people who've persuaded themselves that the EU represents the enemy. Some are so deluded they think Putin is a friend (he's anti-eu, you see). Cameron will get something. Whatever it is, it won't be enough for the EU hysterics. And I refer you once again to my statement: I don't care, either way. Like most people.

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Musings said...

Always a fan of your blogposts Jackart, and have been reading the yearly summary for over 3 years now. Impressive predictions!

I open up A Very British Dude every few weeks, and am always glad to see another new post.

My main worry/area of interest this year is the markets, which seem to be going haywire at the moment, and potentially moving back to a 'bad news is good news' view with Central Banks becoming Dovish again. Would be interested to hear your views.

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