In this essay, an (amateur) economist tries to predict us what products we could invest in in 2010 without any loss. The first question is, can we know what is going to rise and what is going to decrease in one year? I expect when someone follows the economic news daily, he could predict this.
Last year this economist had predicted that gold and oil were going to rise. In a year with a lot of problems gold and oil rose. So he made two good predictions but I do remain with some doubts left. He also thought that the price of the UK houses would fall in this year but this has not happened. Now he says, the UK house price is going to rise in the long run/term. I find this an easy prediction because the immobile prices are rising every year with the purchasing power. People earn more money so the price is rising to a higher level. Otherwise last year many people would have been surprised that the UK house price had fallen.
Now he easily foretells that there will be coming a recovery of the stock market after the financial crisis. This could be a good point for all the people who have lost a lot of their money last year in business. For 2010 he predicts that an investment in oil, Chinese Yuan or gold can be an good investment.
In 2009, oil had risen from $60 to just under $80. He thinks it can rise more because before the recession, oil had a price nearly $150.
The Chinese Yuan is another difficult prediction because we don’t know the Chinese currency very well. It is one of the countries who has grown a lot in the last dozen years. A problem why we couldn’t predict easily this currency is because “They have been resisting an appreciation for many years”.
Finally Gold had risen from $800 to $1150 last year but we all know that gold is a good investment. For this reason a lot of investors will invest and have invested in gold.
He fears that an investment in the US dollar and in treasury bonds could be a bad investment. He is also a little uncertain about an investment in the stock market because you never know what happens in the world.
I’m also a little bit afraid sometimes to invest in the stock market because in this competitive world all the companies try to make better products than others. Sometimes they make so much publicity that they lose their profit. When they lose their profit they are searching for money in other products and they raise the price of product. In this world it is not easy to predict if a share is going well or not. Nobody had thought there was to become a financial crisis. So many people in Belgium have lost their money because of Fortis but so many other shares were decreasing.
So we can conclude when you want to invest your money “safely” maybe it can be an good option to invest in oil. Oil is a scarce good that we all need in life. Gold is a little bit the same as oil so when I got the opportunity(and I have enough money) to invest this year I’d maybe venture in this business.
On the other hand, it is always a good idea to follow the economic news and then to invest in a company. When you were following a company as Google ten years ago, and you had invested immediately, you had received a nice profit. First of all you need to have a look at the annual report and then you can make a safe investment.
Source: http://www.economicshelp.org/2009/11/good-investments-for-2010.html
Dear Gert
BeantwoordenVerwijderenI would like to say: it’s impossible to predict which investment is profitable.
I disagree with your statement. The prediction for the result of an investment isn’t possible. So you have it wrong. I want to prove this, I would like to say that today’s financial crisis has also a negative financial effect that couldn’t be foreseen. I am definitely convinced that the same statement can be used for investments. So, nobody is able to foresee which financial result that is worth the investment. Even a businessman can’t do this, he can only hope that he has done the right investment , but that’s the only thing he can hope for.
Further predictions are useful for prospective investors but they are psychological thoughts who could realize a profitable result. The psychological feelings who make think that you have done the right thing, and with psychological feelings, you can make decisions that come to a solution for the investment problem.
I could summarize this by telling you: “act like your brain”. Maybe, you could think that I’m having it wrong, that might be. But I am convinced that this method of thinking is used by businessmen. So act like you should know it. And if you think wisely, like you said, a good looking annual report of a company can help you by taking decisions in the investment process.