Comments On 2016; Comments And Predictions On 2017 -- December 30, 2016

This is going to be a rambling note for the archives, looking back on 2016 and thoughts on 2017.

I don't know if it's going to be a long note, or a really, really long note. I don't even know if it's still in progress. Just some idle rambling on a Saturday morning; some predictions; some observations; some comments.

Disclaimer: this is not an investment site. Do not make any investment, financial, travel, job, or relationship decisions based on anything you read here or think you may have read here. It's also not a dance site.

1. The US stock market. Prediction: the overall market (Dow 30 / S&P 500) will be higher in October, 2017, than it is now. What it does between now and then is anybody's guess. I'm sticking with my 30-plus-year investment strategy.

2. The coming trade with China. Comments: this is all about plastic toys for US holidays (mostly religious holidays); clothes; and, iPhones. The coming trade war with China is not an existential issue for either country. China needs the US more than the US needs China when it comes to trade.

3. Spy vs spy. Comments: when the market doesn't react to a US president expelling 35 Russian spies diplomats and closing two Russian "compounds," that tells me everything I need to know. Congress loves these kinds of issues. 

4. Coming arms race with Russia. Comments: it's a given that the US military needs to be re-built after eight-plus years of neglect. Even Russia knows that. This, too, is a non-story, except for investors canny enough to know where to invest.

5. Chinese build-up in the South China Sea. Comments: the US had the Monroe Doctrine, 1823. The Chinese have their doctrine, 2016. It's a regional thing. Hopefully the new President will figure that out.

6. The Bakken. Observations: a couple of years of relative quiet, 2015, 2016; more and more infrastructure was put in place in the past two years. Prediction for 2017: slow and steady. Just not as slow as 2016, but just as steady. A no-brainer: operators will get their DUCs lined up.

7. Energy: it might take a year, but if it's not obvious by the end of 2017 that America is the new center of energy -- overtaking the entire Mideast without the fighting -- it will never be obvious to some folks. Crude oil, LNG, and coal exports will  increase -- that genie is out of the bottle.

8. Pipelines. Whatever.

9. Biggest disappointment of 2016; physicists were no closer to understanding quantum theory  in 2016 than they were in 2015. Or 2014. Or 2013. Or 2012. Or 2011. This one we can't blame on George W. Bush although the fact that he was not intellectually curious did not help.

10. Biggest surprise in 2016. Goes without saying.

11. EU: irrelevant. Brexit: kick this can down the road for another year.

12. UN: even more irrelevant. Watch for the "shoe dropping on the UN" once Trump is sworn in. It's not gonna be a pretty picture.Well, maybe it is.

13. The Mideast: as much as PEOTUS Trump wants to minimize US involvement in the Mideast, the US will reverse Obama's Mideast strategy. Oh, that's right. Obama had no Mideast strategy. Trump will punt this one to his generals.

14. Back to investing: investing in oil service companies (HAL, SLB, BHI, GE, frackers, etc) will be a better strategy than investing in oil companies. Re-read the disclaimer.

15. Biggest decision for Putin: whether to test Trump on Crimean, Ukraine, Kaliningrad.

16. Sanctuary cities. I've discussed this before. For me, it's a non-issue. I think Texans would love it if New Mexico declared itself a sanctuary state.