11 predictions for money, technology, stocks and crypto for 2023 – MarketWatch
Here are some 2023 predictions for financial markets, the economy and stocks.
I’ve spent the last year and a half being cautious in the wake of the Bubble-Blowing Bull Market that finally ended early in 2022. Following this year of turmoil, the timing may just be right for us to see the economy morph into something healthy for while.
That would be unexpected in a world where so many CEOs and analysts are predicting hard times ahead.
Keep in mind that the markets and the economy are not the same. And now, onto some the predictions and commentary.
During 2023 we will see the initial blossoming of improved capability and efficiency as people in many walks of life embrace artificial intelligence. This will lead to a gain in productivity over the next three to five years that will rival what spreadsheets, word processors and the internet did over the past 30 years.
Companies will be more efficient and effective in handling their customers, their programming, their legal costs, etc. Economists will be talking about this as an ongoing theme by the end of next year.
Improved productivity will mean a shock to the upside for corporate earnings in 2024, and since the stock market always thinks ahead, AI will help lead a tech rebound in 2023.
Aren’t we already in a recession? There was a debate a few months ago about whether or not two consecutive negative GDP growth numbers were or were not a recession. Certainly, the tech industry and the real estate industries are in their own recessions.
I expect a decent U.S. economy with flattish corporate earnings in 2023. How’s that for a surprise?
During 2024, demand for such talent will be back on the rise.
Margins for Meta Platforms Inc. META,
The Fed won’t have to cut rates as the U.S. economy stabilizes and begins to surprise to the upside by the end of the year. It is healthy for people to be rewarded for saving money in a bank or lending to a government.
As someone who has lived through Fed-driven bubbles and crashes during my nearly 30-year professional career, I would be thrilled to see a normal growing economy with near-natural interest rate levels for a few years.
CPI data will be the most volatile we have seen in decades. This is another reason the Fed will not be compelled to cut interest rates.
That would be normal and healthy.
The Dow Jones Industrial Average DJIA,
Small caps will be wild to watch, as there are hundreds that will run out of money. Then again, some will be primed to roar back. I expect the iShares Russell 2000 ETF IWM,
OPEC+ member states will begin over-pumping while the U.S. increases its supply. This will be a boon to the rest of the U.S. economy, through it will also mean that earnings estimates for many energy companies will have to come down, putting pressure on their stock prices.
After bottoming, bitcoin BTCUSD,
There are still billions of dollars of “valuation” for a few hundred sill cryptocurrencies that will be wiped out in 2023, and the Securities and Exchange Commission and Department of Justice will “ride to the rescue” by finally bringing charges against some of the people involved in selling them.
I would love to buy up some space stocks but we need to wait for the next batch of good private space companies to go public over the next two- to five years. I am holding onto Rocket Lab USA Inc. RKLB,
Thank you to each and everyone of you for reading Revolution Investing on MarketWatch. Happy New Year!
Cathie Wood has had a rough year, but in keeping with her reputation as a 'true believer', she's seizing the opportunity to buy more shares in one of her most controversial picks as it tumbles to fresh lows.
Cody Willard is a columnist for MarketWatch and editor of the “Revolution Investing” newsletter.
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