Sunday, January 4, 2009

forecast for 2009

--Oil will be above 50 by the end of the 2009 As US hit the bottom in the second half of the year, oil market will rebound quickly to reflect the future demand for oil. --30 Y Treasury will be above 4% by the end of 2009. The unprecedent large fiscal deficit and stimulus packages will prompted government to borrow money through Treasury market by crowding the market with more supply. Also the narrow trade surpus in emerging market and reverse SU consumption pattern from binging to saving will curb the demand. --Housing prices will hit the bottom in the August Demand will rise due to seasonable reasons. The government's interventions, buying mortgage bonds and potentail reform in foreclosures, will stablize the housing credit market. --S&P will rise above 1000 --US Corp AAA yield spread will drop to 300 bps and below --US Corp CCC yield spread will hover around 2000 bps

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