What's a prediction without a little courage, bravado or risk-taking? Oh yeah, good instincts and analytics also helps. We've culled some 15 brilliant predictions from the dozens offered by our anchors, reporters, editors and bloggers at CNBC. Enjoy and let us us know what you think.
Posted 01 December 2011
Bank of America flops again about money-raising and puts Merrill Lynch, the world's largest retail brokerage, up for sale, having acquired it in a $48.7 billion stock-swap deal during the height of the financial crisis in 2008. Brokers at Merrill rejoice, and Canadian giants TD Bank Group and RBC Royal Bank take a serious look at acquiring Merrill.
- Gary Kaminsky
Regardless of whether President Obama wins reelection, he will kill the Bush tax cuts for the wealthy in December 2012. Investors will flock to take advantage of a 15 percent capital gains rate that will go back to 20 percent, dumping profitable assets ahead of the change on Jan. 1, 2013. To compound the economic uncertainty, Congressional leaders will fail, as usual, to agree on measures to avoid automatic spending cuts that will take effect in January 2013.
- Greg Valliere
Lloyd Blankfein will retire as CEO of Goldman Sachs, exhausted after serving as chairman and chief executive since June 2006. He’s weathered the credit bubble of 2007, the financial crisis, the transformation of the firm away from proprietary trading, financial reform and a life-or-death lawsuit with the SEC. Many people believe Goldman needs post-crisis leadership — and I wouldn’t be surprised if Blankfein comes to agree with them next year.
- John Carney
With its stock having plummeted, Netflix (lock, stock and off-balance sheet content costs) is acquired by (drumroll!) Facebook, on whose board Netflix CEO Reed Hastings sits.
- Herb Greenberg
Retail gasoline prices rise above $4 a gallon, toward the record high of 2008. Crude oil prices may provide the foundation, but gasoline will likely take off on its own merits. Gasoline futures, more than oil, drive prices at the pump. Gasoline prices usually are at their lows in the fourth quarter and peak between March and May, as refineries undergo maintenance and switch from winter-grade to summer-grade gasoline. Further fueling the surge: the closure of a large refinery near Philadelphia and possible shutdowns of two more along the Delaware River.
- Sharon Epperson
The European common currency will fall to parity with the U.S. dollar by year's end. The European Central Bank will be left with little choice in saving banks and their sorry sovereigns other than to print, print, print euros, and more of something almost always leads to a lower price.
- Brian Sullivan
I don’t think gold breaks $2,000 an ounce. I think gold has basically peaked and is now a bit overvalued. My prediction is that people will buy more stocks than gold. I’m optimistic about the stock market, so I would not be a gold buyer.
- Larry Kudlow
India's rising fiscal and current-account deficits and multi-billion dollar corruption scandals will continue to take a toll on its economy. Inflation and interest rates will remain elevated, while growth will slow. Voters will show their disapproval for the ruling party in regional elections. The government will muddle along and the year could end with a new prime minister at the helm.
- Deepanshu Bagchee
The White House won't change hands. Obama will trounce Romney and be voted in for another four years.
- Jim Cramer
Home prices will fall another 5 percent through Q2 before bottoming toward year's end. Prices are already on a downward trajectory, as foreclosure inventories rise. Banks and mortgage servicers are finally working through a huge backlog of delinquent loans. As those distressed properties come to market, they will lower home prices around them. With lower conforming loan levels, as well as a continued tight lending environment and the possibility of rising mortgage interest rates, prices will bottom out in the fall.
There will be big changes for the Android market. The Android OS gets praise for its market share, but in 2012 the splintering of the OS will start to pose major problems. Google will use Motorola to try to corral the ecosystem, but the bigger story will be Amazon's success in ripping Android's developer community apart. By year's end, there will be many Androids.
I have been traveling the U.S. and all I hear of late is that manufacturing in China isn't like the old days — meaning it's not so cheap anymore. Of course, it's still inexpensive — just not as much as in the past. But as the U.S. jobs economy continues to sputter, the cost spread will continue to shrink, and many companies will decide to make things on U.S. shores because the upside could spark sales if the price isn't too far off.
- Brian Shactman
Credit cards make a comeback, displacing debit cards as the most-used payment method. Debit cards, once a popular tool to curb spending, lose some of their allure, partly because of new usage fees. The credit card comeback is a sign of both a healthier consumer and hungrier banks. Consumers will show their finances are steadier and pull out the plastic, especially if doing so earns rewards.
- Christina Cheddar-Berk
The upscale electric car company has a huge year coming up with the Model S rolling out mid-year. Could Tesla stumble? Sure. But the more you listen to what the company is saying about Model S orders and the upbeat reports from even the most skeptical analysts on Wall Street, you get a sense Tesla's time to turn heads will be here by the end of next year.
- Phil Lebeau
Facebook and Zynga will go public as part of an ongoing stream of social - media related IPOs . Fortune 50 companies will jump on the bandwagon, investing big in these services to reach consumers. Meanwhile, Twitter will launch a sustainable business model, built around the service as a news feed.
- Julia Boorstin
CEO Millard “Mickey” Drexler will work his retail magic to save the once-powerful chain. Drexler was ousted from Gap Inc. in 2002. He was hired by J. Crew in 2003 and restored the brand to its prominence.
- Gary Kaminsky