1. The stock market overall in 2014 will be basically an average year . We expect the S&P to up about 6% or so year end. Somewhere along the way some international event will spook the market and we will finally get a long due correction, not a deep one however. The economy will remain dormant with the feds pumping machine of printing dollars keeping a floor under the stock market. Keep your retirement money in safe steady index funds.
2. The best stock of the year will be MONIF. This little beauty is mobile banking for the un-banked. Do your own due diligence here but buy some MONIF in your speculative account. Selling just above $1. We expect it to end the year at no less than $2, maybe $3. Homegamers can participate here.
3. The run up in mortgage loan rates will finally find a wall somewhere in the high 4% range. With a flat economy as noted in number one there is just no pressure to push these rates up despite the desire by banks to do so. If you are in the market for a house buy one this year since rates are so low for long term buyers. The next move up in rates is mid-year 2015 as we can see right now.
4. One of the best no worry picks for the year will be ARCP. This stock will be the new darling of the triple net leasing group. Joining Realty Income and National Retail Properties as a blue chip hold. We expect the stock to move up nicely by $2 per share from the current just under $13 per share and still pay the current 7% dividend or more giving you a 20% plus profit for the year. So buy ARCP as a long term hold.
5. Politically in North Carolina the Republicans will keep the legislature in November losing no more than a 2 or 3 seats in each house as the Moral Monday crowd will turn off women voters. Rev. Barbour is not the correct choice for a front person for a movement, too scary looking and sounding for moderate women voters. US Senator Kay Hagan will lose to Thom Tillis and US Rep. Mike McIntyre will lose to David Rouser and a off year election does not bring out enough Obama voters to offset the increase in conservative voters coming out against Obamacare.
6. Politically in the US. The US House will stay in Republican hands and they will pick up 3 to 5 seats. The US Senate will stay in Democratic hands due to infighting of Republicans who will pick some non electable in general election Senate candidates. The Republicans will however pick up 4 or 5 seats where good general election candidates survive the infighting.
7. Politically in Smithfield NC even with many new town council members John Lampe will find changing town hall next to impossible. He will get some movement on electric rates and some small concessions in spending, but overall it will be status quo. Understand we consider Mr. Lampe Smithfield's last best hope to revive this town's growth prospects so we would be very pleased to be wrong on this one. Status quo for Johnston County politics except of course for the Clerk of Court race. We will go out on a limb here and predict that Michelle Ball will pull a surprise in the Republican primary and win the general election and be the new JC Clerk of Court.
8. This cold winter will be the repeated next year and this coming summer will be cooler than normal. This due to the cooling of the oceans and the normal cycle of weather. This is a ten year cycle and we are at the start of the cycle. Therefore if you are smart find ways to depend more on natural gas than electricity for energy. Natural gas will bump up in price, but supply is plentiful and elastic and more sources will come on line from the price move up and will move prices down again. Electricity on the other hand is going to see prices move up due to more heavy handed EPA regulations.
9. More local small banks in Eastern North Carolina will be taken over by either a much larger bank or either merged with another small bank. In fact the pace of consolidation will quicken in 2014. The Dodd Frank rules which become effective in 2014 and the costs will make it prohibitive to remain independent unless you are big enough to survive. The big five banks who controlled just over 8% of deposits under Republicans now controlled about 45% under Obama purposely. Case in point is the continued consolidation by Vantage South or New Bridge Bank. The stocks, symbol VSB and NBBC, might be worth some of your capital as an investment. But this is a long term buy no quick profits.
10. There are still a few independent daily newspapers in North Carolina. At least one or two more will be bought by a private equity firm in 2014. The investment in small daily newspapers is like an annuity paying 10% to 15% going forward. This is not like the 20% to 25% some made a decade ago, but still good money for those operations not leveraged to piles of huge debt making owning newspapers not financially acceptable. Therefore private equity has found a niche and the death of local newspapers is quite premature.
11. Bonus prediction. I absolutely positively guarantee I will wrong on at least one of these predictions.
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