The new year is just around the corner now with people hoping for a great 2023 after the chaos of a pandemic-filled 2020 and 2021 followed by an inflation-hit economy and bear market in 2022.
The current focus around markets for the new year is how the Federal Reserve is going to handle its interest rate changes as inflation gets under control and a tightened monetary policy constricts the economy. Most analysts are expecting an interest rate drop at some point in late 2023 or 2024 at the latest following a short period of steady rates. However, all those projections are due to change depending on upcoming price data and economic health as the Fed has already raised rates faster than most expected a year ago due to the economy seemingly being able to handle it so far.
All that interesting monetary policy and its effects on the economy and stock market are good and all, but the real fun part about theorizing what’s to come in the new year is the bold predictions. This isn’t guessing that Georgia and Michigan are going to win Saturday night. No, no, no, these are the spicy hot takes that Brock Purdy is going to win Super Bowl MVP in a couple of months while George R.R. Martin actually releases Winds of Winter this year (jk there has to be at least some possibility of the projections coming true).
Elon Musk Remains CEO of Twitter
Yes, he has already stated that he will step down if he finds someone ‘foolish enough' to take the job.
Well, first of all, he isn’t exactly selling the position to competent leaders with that adjective and there is likely a small pool of nominees to choose from that are actually qualified for the job and want it. Then, Musk would have to be willing to take an ego hit and actually step down for said theoretical candidate he would really have to be confident to hand over his $44 billion dollar baby. A baby that he might not unconditionally love right now because of the problems he discovered in the process of acquiring it but that does not take away the fact he has a rather large sum of assets put into this project.
Furthermore, Elon has successfully managed many other business ventures to get to where he is now and has big plans for the future of Twitter. All his changes might not be universally loved right now but it's hard to see him not focusing on the platform until it gets to a point where it can be more passively managed by someone else. Something that is unlikely to occur within 12 months but anything can happen.
Finally, a general characteristic of Chief Executive Officers is that they do not want to report to someone and even if Elon steps down he remains number 1 as owner of the business. CEOs might report to the board but that's far less direct than serving under one person, especially when that one guy is Elon Musk.
DWAC Never Merges with Truth Social
Well the merger of Digital World Acquisition Corporation (DWAC) and President Trump’s social media company hasn't been finalized yet after being announced back on October 20, 2021. The likelihood of the merger going through gets lower each day as the demand for Truth Social has not picked up at all.
The people who were begging for a more free speech oriented social media platform and/or less left wing have gotten exactly what they wanted with Elon Musk acquiring Twitter. His entire premise for purchasing the social media giant was pretty much built on free speech and exposing the truth of how the algorithms work for displaying content. The corner of the market that wanted a non-Twitter Twitter platform has pretty much gotten what they asked for in an Elon Musk run social media platform.
Also, there’s one major aspect yet to fall.
Bonus Round: Trump Gets Back on Twitter
Ya there’s no way Donald J. Trump can resist the pull of Twitter for much longer.
He’s pretty much single handedly carrying the small piece of relevance that Truth Social has and his 4.7 million followers can’t even begin to compete with the 88 million on Twitter. Any moment now Trump is going to be sick of pulling less than 50k likes and want to go back to the days of over 500k. With him running for President he will want to reach the most people directly that he can. When that moment arises, it will be… ‘interesting’.
Financial Services Will Win 2023
2021 was the year of technology as tech giants prospered in a still somewhat quarantine economy that was increasingly reliant on technology for remote work and leisure. This year it was all about energy stocks as international affairs and a reopened economy led to skyrocketing oil prices. Now, 2023 looks poised to be the year of high-interest rates and either a flat economy or an economic downturn.
A state of higher rates generally leads to stronger profits from banks as the difference between interest paid to customers and interest earned by investing grows. That principle can always be easily clouded though with high inflation and rising defaults on loans. However, more recently, inflation seems to be finally getting under control and the economy remains healthy for now.
Meanwhile, another strong pick for 2023 will be more defensive investments that perform well during economic shortfalls as a red-hot economy is unlikely to be seen with such tight monetary policy compared to where it was just less than two years ago.
Sports Lightning Round Predictions
Okay now to the real reason for making this article.
First, the best sport in the world sees another title for a California team with the 49ers beating the Bills as four Super Bowl losses aren’t enough for the Buffalo faithful. Next, the Boston Bruins finally get the best trophy in sports again and the Tuukka Rask haters are proven right, but also still wrong. Lastly, Giannis Antetokounmpo gets his second championship as Luka Doncic can’t quite carry the Mavericks to a Finals victory.
O ya baseball is a thing too, let’s say the Padres win it all over the Yankees because Fernando Tatis Jr. is cool and it's always fun to see the Yankees lose.
