Y2Kansas: 10 Predictions for the Year Ahead

<I>TSC's</I> editor-in-chief also reviews his past calls.
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It's that time of year when we all peer into the next 12 months, trying to figure out what will surprise us. No question -- the stock market's continued strength has surprised a good number of people, as has the proliferation of dot-com stocks. It seems that you can't get 10 feet down a sidewalk without being deluged by dot-com advertising on buses, cars, billboards and telephone booths. The

Super Bowl

this year will be one huge dot-com affair, with a couple of


ads tossed in for good measure.

Discuss Dave Kansas' Y2K predictions on our message boards

Before we delve into the 10 new potential shockers of 2000, let's take a quick look back at the two sets of forecasts delivered this year. At the start of the year I

offered 10 shockers for '99, and at midyear I put forth seven surprises for the

second half. Let's check the report card.

For the 10 potential shockers at the start of 1999, I grade myself with six right and four wrong -- not bad if you're playing baseball. The right: Japan recovers; Internet stocks continue to soar; Super Bowl indicator debunked; emerging markets revive; oil prices jump; military confrontation rises in Europe. And the misses: Stock-market gains peter out in the second half;


is removed; independent presidential candidate emerges; the

Artist Formerly Known as Prince

returns as a mainstream hero.

The midyear report card is more middling. I said the Y2K bug would be largely solved in the U.S. (right), but would be a problem elsewhere (we'll see);

George W. Bush

would commit a series of gaffes and stumble in the polls (right); oil prices would drop (not really); consolidation would happen on the Net (some); Balkans would cool (right); Asia heats up (not really); Japan keeps going (kind of); U.S. wins

Ryder Cup

(right), but I had

Phil Mickelson

sinking the clinching putt on the last day, not

Justin Leonard


So, on to the new year with 10 new potential shockers.

1. The stock market will put in another record year.

Yes, the doomsayers are getting bolder, and more and more investors are befuddled by the stock market's uncanny ability to keep rising. Like the late 1950s, the investment community is undergoing a revolution in terms of the risk it will tolerate. And like the 1950s, we won't understand why this makes sense until we have a few more years under our belt.

2. Dot-coms break into two worlds.

A small band of perceived winners continue to soar to unprecedented valuations, stunning a skeptical Wall Street crowd. But dot-com reality slams a good chunk of the sector. Many firms have to fold or merge in order to compete in a more complex world. Broadband, wireless and other factors contribute as investors grow more skeptical of some of the more curious dot-com business ideas out there.

3. George W. Bush becomes president.

After some early confusion, and despite the best efforts by the media to aid





Al Gore

will face George W. Bush for the presidency. Bush, refusing to debate Gore, will eke out a narrow win.

Hillary Clinton

will win in New York and

Donald Trump

-- who does do some debates with Gore -- will get 4% of the vote running on the reform line. At least it'll be fun to watch.

4. The New York Stock Exchange decides to go entirely electronic by 2001.

This surprising development follows on the heels of the NYSE's IPO in midsummer. The decision sends a shock wave through the lower Manhattan real estate market. The local anger and anxiety about the decision contribute to


problems in his failing bid to win the


race in New York.

5. China and Taiwan conflict heats up.

In the wake of the Taiwanese election, the country declares itself independent of China and China responds by mobilizing its military. The summer is marked by a tense standoff with the U.S. caught in the middle. Asian equity markets, with Japan the lone exception, tumble.

6. Short-selling, left for dead by February, begins a strange resurgence in late summer.

Daytraders jump on board, realizing they can make a good deal of money on the short side as well as the long. The resurgence occurs one month after

Herb Greenberg

writes an obituary column about short-sellers, saying their time has passed.

7. Despite the best hopes and wishes of James Padinha, our resident economist, inflation does not rear its ugly head in 2000.

Rising productivity, falling commodity prices (notably oil) and other factors put the inflation bogeyman to rest. Also, the economy steadies to a more sustainable level of growth, and the bond market rallies.

8. The next hot Internet region: India.

Supported by strong technology and a curious population, India surpasses China as the emerging hot Internet market.

Yahoo! India

becomes a huge success, and other Internet companies spring up in South Asia.

9. Mobility becomes the key phrase in the U.S., outstripping terms like broadband and convergence.


(QCOM) - Get Report

, it turns out, was not overvalued, and other wireless plays become hotter than dot-coms were in 1999. By the end of the year, whispers about the death of the PC become widespread, giving

Dell Computer

(DELL) - Get Report

some problems.

10. England wins the Euro 2000 soccer tournament, shocking the soccer establishment



Lance Armstrong

wins the

Tour de France

again and the

Minnesota Vikings

finally win the Super Bowl.