Episode Details

Good Sunday to you,

Before we begin, let me flag this week’s commentary.

This a trade with a remarkably successful hit rate, a clear timescale and a relatively easy risk to manage - you know pretty quickly if it isn’t working. 8 of last year’s 9 ideas worked. By my reckoning you will find the biggest bargains of the year tomorrow, Monday December 22, and Tuesday December 23. So take a look:

Right, so today I am marking my own homework.

Every year, as old timer’s will know, I like to offer some predictions for the year ahead - usually 10, but with inflation being what it is, it ends up higher.

Today we look back and see how I did.

The usual disclaimers apply - the more outlandish the prediction, the more entertaining - so the more likely I am to make it. But the less likely it is to actually happen. I try to strike a balance …

As events change, so do opinions. Process is gradual. But when you jump a year, with no scope to revise as events turn in a different direction, quoted out of context and with the benefit of hindsight, predictions can look really, really stupid. Don’t judge me, bro.

I often find that the worse my predictions, the better my portfolio performs, which is odd, but there you go.

If you want to read last year’s piece in full, it’s here. But I’ll quote quite copiously below.

A reminder of the scoring system: 2 points for a direct hit, 1 for a quite good, 0 for a miss, and -1 for an epic fail, giving me a maximum of 30 and a minimum of -10.

How did I do? Let’s find out.

1. The long overdue correction in the UK housing market finally begins.

You can read my reasoning here, but it boiled down to: richer people being net sellers as they leave the UK, few foreign buyers, fewer buyers more generally because of high moving costs (Stamp Duty etc), little bullish sentiment in the economy meaning a reluctance to borrow and invest and the 18-year-property cycle turning down.

What actually happened is by no means clearcut, but I’ll try and summarise.

Price growth and transaction volume were relatively high in the first 3 months, until Stamp Duty changes came into effect in April, after which the market became “subdued”. Overall, the north saw some increase, while London fell 2.4% in the year to October. Average growth was 1.7%, which is some 2% below official inflation rates - real inflation is of course much higher - meaning there have been price falls in real terms. This is even with the Bank of England bringing rates down, thereby enabling more money to enter the market via increased borrowing.Overall, transactions volumes increased by 9% on 2024, to get back in line with the 10-year average, though there is a very different story at the upper end of the market.

The housing market has big problems, especially in the south, but it hasn’t cratered - though nor has it soared. I’m giving myself 1 point.

2. Keir Starmer survives

Everyone thought he was toast this time last year - and he is - but my argument that “it’s too early for Labour MPs, worrying about their seats, to give him the shove” prevailed. 2 points.

3. Gold hits $3,000.

And the rest. It’s $4,300 as I write and going higher. I was too conservative. 1 point.

BTW. If you live in a Third World Country such as the UK, I urge you to