Byron R. Wien, vice chairman of Blackstone Advisory Partners, has disclosed his top 10 surprises for 2013.
The list of forecasts by Wien marks his 28th year of annual predictions. Wien joined Blackstone in 2009, but began the annual tradition in 1986. He was then the U.S. chief investment strategist for Morgan Stanley.
As is customary, Wien includes a few “also rans” that didn’t make the top 10, either because he feels they are not as relevant as the top 10 or he’s not comfortable enough that the ideas are “probable.”
1. Iran gains nuclear capabilities.
2. The S&P 500 declines to below 1,300.
3. Financial stocks tumble after a strong 2012.
4. Crude oil falls to $70 a barrel.
5. The GOP makes a major push for immigration reform.
6. The Shanghai Composite shoots up more than 20 percent as the leaders in China seem determined to implement reforms to root out corruption, as well as keep the economy growing at 7 percent or better.
7. Commodity prices rise as climate change produces another poor crop season.
8. Gold spikes up to $1,900 an ounce as central bankers continue to debase their currencies.
9. The Nikkei 22 explodes as exports improve and investors return, while the yen plummets to 100 against the dollar.
10. European equities decline 10 percent amidst continuation of austerity as the structural problems of Europe remain largely unresolved.
Among the “also rans,” Wien predicted that the VIX Volatility Index, which traded below 20 for most of 2012, will surge 33 percent to 30 as the decline in the S&P 500 increases market volatility. In addition, the massacre at Sandy Hook Elementary School in Newtown, Conn., finally convinces Congress to do something about gun control. On the tax front, Wien predicts that Congress considers other options, such as more discussion over the value-added tax and the wealth tax due to frustration over an inability to increase revenues through raising income taxes.