Time to be wrong about the future: what is your best prediction about what 2025 would look like?

[ertyu]

T'is the time: two more weeks are left in December, CAPE is at historical highs, and a new year is upon us. What is your best prediction about the economy and the stock market in 2025? Usual caveats apply: this is strictly for fun, not financial advice, and accounts for how thinking humans recognize that the best one can do about the future is speculate.

Have at it!

ETA: do you remember what you predicted this time last year? Were you right?

[Seppia]

2025 predictions, having fun and fully expecting most to be dead wrong as usual

- Tesla keeps going up for no reason. Musk eventually gets his twice-cancelled stock grant.

- the US stock market will close higher on December 25 than it will in December 24

- Germany’s economy will continue to spiral. China’s economy continues to sputter.

- Russia and Ukraine settle on a peace where nobody can really claim to have “fully won”, but where in essence Russia wins and Ukraine loses.


Below my prediction for 2024.
I missed the market forecast, but nailed the presidential one.

Market crashes are usually coming when nobody is expecting them, so I think 2024 could be one of those years - we think we are in the clear since everybody was predicting hell for 2023 and it didn’t happen.

I think we had so much time (especially in Europe) with little to no inflation and, as a consequence, very stagnant wages*, that 2023 was a product of the west being subject to a collective case of money illusion.

2024 could be the year where people wake up to it (or not).

There is usually a low chance of a recession in any given year, but I think in 2024 it could be higher than usual.

Trump wins the election, and contrary to what the losing party always says, nothing really changes dramatically in the USA

*the first salary of a college graduate in economics in 2022 was the same, in Italy, that I started with back in 2004

[Lemur]

Linking last year's prediction thread:
viewtopic.php?t=13035

[fingeek]

BTC $180k

[Laura Ingalls]

Everything that pops into my head is very negative. I am going to decline to participate.

[blink2ce]

2025 prediction:

- The power grid in the USA continues to change quickly, which creates a weird problem that no one really accounted for. It doesn't cause a giant blackout but it's a big enough problem that it makes the news and FERC and NERC start issuing new compliance rules.

- Inflation continues above the Fed's 2% target, and it becomes clear that there isn't anything the Fed can do to bring it down. Congress continues to spend much more than they take in income, which puts more pressure on the Fed to monetize government debt. Some new weird rule is passed either by congress or executive order which makes it easier for the banks to lend money, so that the Fed doesn't have to say "officially" that they are monetizing more government debt. As a result, Bitcoin, gold, and land continue to rise in dollar-denominated value.

- New cars have become so unrepairable that in 2025, auto mechanics willing to work on these new cars will be so hard to find that people will have to walk away from their 5 year old cars, and there be an auto debt bubble pop. The value of 10+ year old reliable Japanese cars will reach new highs (This is pretty left field. Maybe I will be right tho!)

[suomalainen]

In the US, depends on the politics. Which is sort of a funny thing to say because "capitalism", but based on the talk, politics could have an inordinate amount of sway - from tariffs and tariff-exemptions-for-friends (read: big companies) to widespread disruption of food production industries reliant on migrant workers, yeah, who knows? I don't even think the talker knows.

So, I'll predict something between crash and boom.

[Bonde]

I'm an optimist.
- No cease fire is reached in Ukraine. US/EU instead increase support and the Russian army suddenly collapses in the fall as a churn rate of 2-3000 dead/injured per day is to big to handle for any army. Leads to Putin's peaceful resignation.
- Elon again claims that full self-driving is almost there and will be ready by '26.
- SP500 is 5% lower at the end of '25 and this affects CAPE positively.
- The prime minister of France will stay the same.
- AfD will get 20% but will not get any political influence. Scholz resigns and a CDU/SPD government is formed.

[Seppia]

- Elon again claims that full self-driving is almost there and will be ready by '26

This one is too easy, he’s been predicting “definitely next year” for like 8 years now.

- The prime minister of France will stay the same.
- AfD will get 20% but will not get any political influence. Scholz resigns and a CDU/SPD government is formed.

Those would be great outcomes honestly.
I am particularly afraid for Germany: their economy is (and will be) ravaged by their irresponsible energy policies.
They are already experiencing a massive reduction of their industrial sector, with chemicals (BASF, Bayer…) and automotive (al the VW group) having to relocate elsewhere where energy is cheaper, or face extinction.
Historically, a poor and weak Germany tends to mean big trouble for Europe.

[C40]

average stock prices up
average quality of life down

[take2]

- Trump falls out with the majority of the people that were close to him running up to the election, leading to a lot of blame and not much change

- BTC first, then ETH continue hitting ATHs, leading to continued mania in all of the crypto alt space. Music stops at some point pre 2026, with the catalyst being some political mishap and/or monetary policy impact. However, this leads mostly to the alt crypto scene crashing with BTC/ETH dropping but only to c. -10 to -20% of the levels they start the year with, demonstrating a new floor of what they were at immediately prior to the election.

- US stocks continue to outperform here relative to the rest of the world. Not sure the music will ever stop here, but if it does it won’t be this year.

- I will finally pull the trigger on (some kind) of a career break / early retirement (likely the former) to spend more time with my kids before they start school. Not much of a prediction given within my control, but wouldn’t be surprised if this is the only one that isn’t true in a year!

[loutfard]

(Edit: dropped my own useless comment)

[IlliniDave]

I think 2025 will be about 365 days long, and where I live it will begin in winter and end in winter and have a warm stretch roughly midway through.

Otherwise, I don't know much. I'd guess it will be far less bad than pessimists and doomsday prophets think, and considerably worse than incorrigible optimists think.

My hopeful prediction is that the US will begin to turn the corner on its healthcare and agriculture practices, and begin to clean up its food supply by shining a bright light on, and beginning to eliminate, shitty agricultural practices, a healthcare system that disincentivizes restoring health, and removing harmful food additives and food-like products from store shelves.

[7Wannabe5]

1) An American child living in a Quaker sanctuary near the Canadian border with his undocumented parents will learn that 2 + 2 = 4 as he and his cousins count and wave at all the National Guard trucks pulling into the parking lot.

2) An American child living with her Meemaw in a manufactured home in rural Florida will wonder whether the cartoons she watches on the cracked screen of her phone or the shiny new textbook distributed at her charter school tell her the truth about the age and origin of the planet she lives on, as she unknowingly snacks on the same shape of Aramark Incorporated nutri-muffin being consumed by her Daddy in the state penitentiary.

3) An American child living near Denver, the only biological descendent of the 10 affluent humans gathering or sending greetings via Zoom for her first birthday party, will laugh as she smashes the tiny $30 vegan organic fruit puree cake representing less than .005% of the value of her trust fund updated to reflect recent deposits and gains.

4) An American child who just moved from Detroit to Atlanta with his mother and her new boyfriend will have to wait weeping for over half an hour for the ambulance to arrive after he trips in the unprecented August heat and the liquified asphalt burns all the uniquely identifying whorls off the palms of his hands.

[Jean]

I will have a good time.
I will work a little bit more and save some cash that i'll be able to invest.
My gf will get pregnant.
We will catch one of those boars in january.
Musk will lose billlions because of how much time he'll spend playing POE2.

[Henry]

The billions spent on NVDA GPU's will create a step shift in our lives. AI will become a discernible "thing" as the big boys start plugging all that shit in. It's power will creep up on us in small and innocuous ways but we will feel unease at it's predictive abilities as in how the fuck did it know I want that or I feel like I'm being watched. We will sense some type of intrusion and shift in our lives and sense its force as it establishes its presence. Minor tweaks here. Minor tweaks there. But we will be adjusted by it. The great conforming begins.

The US will have to fight tooth and nail to stay out of a foreign conflict.

Software stocks will go nuts.

Organized religion begins a comeback.

Jill Biden will get caught with a male escort.

Baron Trump will become his generations JFK Jr.

Tesla shows it's real.

[thef0x]

My bets:

1) The US dollar remains strong, strengthening against the euro, yen, yuan. BRICS and said currency goals go nowhere.

Trade: continue my own trend of high % USA bias.

2) Tariffs are mostly against china, causing inflation to rise for most household consumer goods except food and clothing. Chip manufacturing slows and becomes more expensive due to this theme (china's blocking rare material exports to USA+partners).

Trade: short alibaba&temu&shein-like companies

Before 2025: buy your cheap chinese goods/tech (we bought ebikes).

3) Intra-NAFTA trade increases. Trump drops the rhetoric with Mexico and Canada.

IMO there are no obvious trades here as MX and CAN indexes are still weak compared to US.

4) AI's economic impacts are real and cause big tech to consolidate expenses leading to higher profits while causing labor stress for anyone with a CS degree. Big tech continues to geoarbitrage coding abroad.

Trade: buy $VUG or $QQQ or if you're really confident, $TQQQ

5) Zero progress on ASICs re LLMS. Little progress on hardware-specific solutions to inference. Turns out FAANG still needs a ton of power and a ton of GPUs.

Trade: $NVDA continues hitting ATHs

6) Healthcare stocks get hit hard b/c of PR. I'm reluctant to buy short positions but I think this bet is a winner.

Trade: short $UHN $CI

7) BTC is all over the place but ends the year above $110k USD. ETH rallies to ATHs, altcoins (specifically "AI" coins) are frothy as hell.

Trade: buy&hold ETH, very small bets into AI coins and take 50% principle out at 2x, 100% out at 5x.

8) Deportations of immigrants is mostly smoke, with the GOP using a few small moves to declare "we won". Business pressure + stock market go BURR > fulfilling promises. Net little inflation b/c of immigration policy in 2025 but I believe new immigration will go way down, causing inflation in the end of Trumps term.

Trade: any companies who have taken a 5-10% haircut on tariff speculation that are not chinese companies.

9) Russian invasion of Ukraine ends with forfeited land, markets go bananas.

Trade: shove $VXUS for the PR cycle

\\

My actual trades:

Buy more $VUG, buy 2% of portfolio as ETH.

[frugaldoc]

US 30-year treasury bond yields end the year >5.5%.

[loutfard]

9) Russian invasion of Ukraine ends with forfeited land, markets go bananas.

Why would markets go bananas on that? This would hardly rebuild any trust. And as the Dutch language saying goes, trust comes on foot, but leaves on horseback.

[zbigi]

Why would markets go bananas on that? This would hardly rebuild any trust. And as the Dutch language saying goes, trust comes on foot, but leaves on horseback.

The risk of Russian tanks within the next 5 years n Warsaw, Prague, Bucharest or Helsinki would fall considerably if the cease fire is signed. That should definitely help the markets of countries which border with Russia. As for the rest of the world, it would depend on lifting the sanctions against Russia. If Europe starts buying Russian fuels again, it should strongly prop up European markets.