no gradient tracks

Public discourse is filled with forward looking statements that are seldom checked for accuracy. no gradient tracks will do just this as it has long held that tracking forward looking statements is beneficial for public discourse. This publication holds itself accountable with the predictions scorecard, it will now do the same for others.

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• “Brexit will formally happen next month, to much fanfare.” – The Economist, backup. Britain formally left the EU on 2020 January 31.

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• “I think Harvey Weinstein will be acquitted in his criminal trial … or at worst he’ll plead out to a much lesser set of charges.” – Epsilon Theory, backup. Weinstein “found guilty of two felony sex crimes…faces a possible sentence of between five and 29 years.”

tracking

• “Trump’s populist tendencies coupled with the very real economic pain being felt across broad swathes of the American electorate provides the current administration with an obvious path forward to electoral success: absolutely massive social spending.” –Peter Zeihan, backup
• “And since everyone agrees in general that infrastructure spending is good (it’s just the other guys’ specific ideas that are kooky) expect a lot of it in the not-so-distant future.” –Peter Zeihan, backup
• “Long after the epidemic peaks in the United States and Europe it will rage through the developed world, inflicting far deeper damage to populations and economies. The United States has HVAC systems and indoor plumbing and so has the option of social distancing. Much of the world’s population does not. And while the American economy is largely sequestered from the rest of humanity, that of the developing world is not. Damage there will reverberate through the global system, region by region, sector by sector, in ways that will break the global Order’s very foundation.” – Peter Zeihan, backup
• “Oil prices are going to, and through, zero. Sometime soon, probably before the end of May, oil prices will be negative. Pretty much everywhere.” – Peter Zeihan, backup
• “My prediction is that we should see occasional mutations to the spike protein of #SARSCoV2 that allow the virus to partially escape from vaccines or existing “herd” immunity, but that this process will most likely take years rather than months.” – Trevor Bedford, backup
• “Boeing is probably going to be one of the first “too big to fail” corporations that will require us to embrace corporate socialism with a bailout. It will be presented as an “emergency” and it will be 100% bipartisan. The bailouts are coming again. They won’t come for you…Deutsche Bank is next on my list after Boeing. By this time next year, it might not exist any more. They can’t use Greece to bail it out again, there’s nothing left…Wells Fargo is probably the #1 failed US bank. I expect it won’t exist by next year.” – Andreas M. Antonopoulos, 1, 2, backup, 1, 2
• “The Communist Party’s authority is predicated on improving economic conditions, and for a mix of reasons China now faces interlocking crises in finance, consumption, housing, energy, materials, import, merchandise export, pensions, and manufacturing. Each of the eight will hit the Chinese harder than the Americans got hit during the 2007-09 financial crisis, and all will hit more or less simultaneously. One of the downsides of single-party rule is, when recession hits, there’s no one else to scream at.” – Peter Zeihan, Disunited Nations page 124, backup
• “Simply put, when the China bubble breaks, it will take every sector down at once, including the one that grows the food.” – Peter Zeihan, Disunited Nations page 43, backup
• “Without the global security the Americans guaranteed, global trade and global energy flows cannot continue. Seven decades’ worth of global industrialization and modernization are not simply at risk, the very pillars of civilization are cracking…It’ll be less like the messiness of the early 2000s or the raw potential of the 1950s, and more a disastrous combination of the battle royales and displacements of the 1870s against the economic backdrop of the 1930s…We should be worried about Saudi Arabia, not Iran. We should be thinking about how to remedy mass starvation in China, not counter its economic and military clout…The United States will retain—by far—more power than any player, past or present. So it’s important to understand both domestic limitations on Americans’ capacity as well as the sorts of issues and allies they will still care about.” – Peter Zeihan, Disunited Nations, backup
• “While technically elder abuse, it’s going to be amazing dismantling Joe Biden, and watching Trump stomp the shit out of him for six months. Imagine what the Bernie Bros will be like after Biden loses…” – @ComfortablySmug, backup
• “My reasonable expectations for the coming decade–as in my new book, The Little Book of Common Sense Investing, 10th anniversary edition just coming out–I’m pretty conservative. I look at the sources of returns, that’s all I do, and the fact that other people don’t do it that way doesn’t bother me in the slightest. I look at investment return and that’s today’s dividend yield, which is less than 2% for the S&P 500, and I look future earnings growth. While future earnings growth has averaged 5% or 6%, I’m looking for a lower future earnings growth, say 4%. I got my 2% dividend yield, there’s no arguing about that, and I’m guessing the earnings growth will be slower. So, that gives me a 6% investment return from the fundamentals of the marketplace. Now the other part of it is not investment return, but what I call speculative return. That is valuations. If a valuation goes from 10 times earnings to 20, that adds 7% a year over a decade. It’s kind of amazing. We’re not in anywhere near that extreme territory, but I think valuations will probably take 2 percentage points a year off that 6, getting to 4. Where does that come from? Well, we’re looking at a price/earnings multiple on the S&P. By my standards, past reported earnings, not by Wall Street’s standards, future operating earnings–there’s a big difference between the two–so, I have the P/E at about 25 right now. If it goes down to 18, we’ll lose a couple of points in valuation, which will take that 6 down to 4.” – Jack Bogle, backup, 1
• “The last time the world wrestled with a new technology that reduced the costs of information flow, it was the telegraph and telephone. Then, like now, we had no legal tools for regulating what people could and could not say in the public domain. Slander became omnipresent, particularly in politics. Congress was of questionable effectiveness, and ultimately it fell to the Supreme Court to force a nationwide standard for libel. Media became responsible for the accuracy of what they printed. Something like that is inevitable for today’s social media too. We’ll get through this. The question is, how long will that take? And, what will we break between here and there? Last time, the Supreme Court didn’t act until it became clear Congress wouldn’t: 1964. I have some confidence it will be quicker this time around because the holes in our system are so obvious and what’s left of both parties agree on the core issue (even if they define the problem differently). Not to mention faster information flow works on the Supreme Court just as effectively as it does on the rest of us.” – Zeihan on Geopolitics, backup
• “The point is that this primary process is the end of the Democratic Party as we know it. How long will it take to reform with a new set of factional alliances? History suggests 8-12 years.” – Zeihan on Geopolitics, backup
• “Biden’s debate performances have been nothing short of awful and IMO he not going to make it, particularly in an environment where the party radicals are the ones who show up to primaries and caucuses.” – Zeihan on Geopolitics, backup
• “My contention is that the paradigm we’re at now with these big screens in our pockets…we’re at the maximum point of mobility and functionality…AR glasses you could see that being a thing I just don’t think it’s ever going to be as big of a thing as the phone…This is going to be things but they are going to be less significant and less important than what we’re at now…I think we’ve reached the peak of what matters and what happens after this is all going to be built around the assumption that the single most important paradigm is smartphones on one side and hyper scaler clouds on the other. And just was we will still have mainframes and we still have PCs on the other side of the hill we will still have IoT we will still have AR and VR but I don’t see them ever rising to the level of importance as eclipsing the smartphone the way the smartphone eclipsed something else…I don’t think this is the end of technological innovation, I don’t think this is the end of new things. IoT is a massive market, voice assistant big thing, AR/VR are all going to be big things. The cloud is going to evolve. There are going to be new ways to compute. But if there’s not an eclipse, if there’s not something that disrupts or displaces what came before [smartphones], then it follows in my mind that the companies that are still most likely to be dominant in those areas, the downstream areas…are probably going to be the companies that are most essential to this top of the hill…the four biggest companies right now by market cap are Apple, Microsoft, Google, and Amazon, my suspicion is that in ten years it will be the same four. [starts at 21:50]” – Exponent Podcast, backup.
• “This debt bubble can’t continue. I think within three years, but certainly within five, you have a major financial meltdown. And crypto will probably be ready enough to be a credible alternative for a lot of the world.” – Erik Voorhees, backup
• “In times of economic degradation – in particular the sorts of broad-spectrum economic collapses that are on deck for Europe – governance tends to get dicey. The idea that the EU’s pan-governmental system will survive the economic collapses-to-come is, in a word, hyper-optimistic. Even now, in times of relative wealth and stability, democracy is failing in Poland and Hungary, while the far right is becoming politically respectable in Austria, Italy, the Netherlands and France. The political fringes in Germany – both left and right – have even odds of dominating the next national elections at the expense of the centrist parties which have ruled since the war.” – Zeihan on Geopolitics, backup
• “Greece will never recover. Greece’s agricultural, energy, financial and industrial sectors are for all practical purposes, gone. Greece only continues as a state because the EU shells out money for it to exist. This is the price that must be paid for the euro to have any international credibility whatsoever.” – Zeihan on Geopolitics, backup
• “In 2019, multiple independent teams worked together to build the software necessary to launch the first phase of Eth2. There is now little doubt that Eth2 will enter production in 2020.” – Josh Stark, backup
• “We believe that life for the poorest will improve more in this 15 year period than it ever has before [1:00]…1 in 20 kids now die before the age of five get that down 15 years from now to be 1 in 40 [2:00]…We predict we’ll get African productivity up to 1.5x where it is today and that will get Africa to the point where even with its population growth, somewhat worse weather, instead of importing food, it will be able to feed itself [2:57].” – Bill Gates
• “In the 2020s, I believe we’ll see layer two solutions, or new blockchains come out which increase transaction throughput by several orders of magnitude…I believe we’ll eventually see a “privacy coin” or blockchain with built in privacy features get mainstream adoption in the 2020s…My prediction is that we will see consolidation of chains (in developer mindshare, user base, and market cap) in the decade to come…I believe the best new companies that get created in the crypto space in the 2020’s will be about driving the utility phase (people using crypto for non-trading purposes)…I believe that by the end of the 2020’s almost every tech startup will have some sort of cryptocurrency component…In the 2020’s, I think we will see cryptocurrency adoption in emerging markets scale to hundreds of millions of users, with at least one country “tipping” so that the majority of transactions in their economy happen in cryptocurrency…Eventually just about every financial institution will have some sort of cryptocurrency operation, and most funds will keep a portion of their assets in cryptocurrencies…I think we will then see basket digital currencies come out, either by a consortium like Libra or CENTRE, or possibly the IMF itself…I predict the SEC will get more comfortable with a cryptocurrency index fund for retail investors…In this world, non-custodial wallets, DEXs, Defi, and Dapps will continue to improve in terms of usability and security, and we’ll see a lot of new applications emerge, from games, to online communities, to virtual worlds with their own economies. Many of the apps and non-custodial wallets in this world, since they never store customer funds, will be regulated like software companies instead of financial service companies. This will dramatically accelerate the pace of innovation and make them inherently global from day one (instead of geographically restricted to certain countries). There will be greater privacy in this world as well, with privacy coins and non-custodial wallets seeing greater adoption. We’ll also see the rise of decentralized identity, and reputation scores associated with those identities, replacing the credit rating agencies with a more modern/global approach. As the decentralized cryptoeconomy grows, more people will earn a living in crypto and feel a sense of empowerment, much like early immigrants coming to America….As a bonus final item, my friends Olaf Carlson-Wee and Balaji Srinivasan estimate that at a price of $200,000 per Bitcoin, more than half the world’s billionaires will be from cryptocurrency.” Brian Armstrong, backup, 1, 2, 3, 4
• “I think that whoever is elected in 2020, we will see a $2 trillion spending plan enacted in 2021. If it’s a second term for Trump, it will be the 2021 Make America Great Again Act, and we will call them ‘Infrastructure Bonds’. If it’s a first term for a Democrat, it will be the 2021 Take Back America Act or something like that (I suppose if it’s President Biden we can hope for the 2021 No Malarkey Act, although I’m rooting for the 2021 OK, Boomer Act), and we will call them ‘Green Bonds’. In either case, I expect that the Fed will monetize at least half of the bond issuance. At least half. In either case, I expect that the primary corporate beneficiaries of the spending will be exactly the same. Exactly the same.” – Epsilon Theory, backup
• “We’ll have the technology to feel truly present with another person no matter where they are, and scientific research will have helped cure and prevent enough diseases to extend our average life expectancy by another 2.5 years…While I expect phones to still be our primary devices through most of this decade, at some point in the 2020s, we will get breakthrough augmented reality glasses that will redefine our relationship with technology.” – Mark Zuckerberg, backup 1, 2
• “As we enter the third decade of this century, I’ll make a prediction: by the end of it, we will see less poverty, less child mortality, less land devoted to agriculture in the world. There will be more tigers, whales, forests and nature reserves. Britons will be richer, and each of us will use fewer resources. The global political future may be uncertain, but the environmental and technological trends are pretty clear — and pointing in the right direction.” – Matt Ridley, backup
• “Iran lacks immediate retaliation options and so will have a chance to cool off a bit. Add in the clerical elites’ newfound concerns for their personal hides and most factors point to Iran not egregiously poking the Americans soon.” – Zeihan on Geopolitics, backup
• “Frankly when I look at what’s going on in Europe, and I look what’s going on in Britain, I was always a sort of Brexiteer. Because they did perfectly fine for 500 years without that union of countries down there who seem to all hate each other and can’t make a decision on anything. So I think this is actually going to be very good for the British economy- I separate myself from most on that.” – Stanley Druckenmiller
• “This means nearly every flagship Android phone will be a 5G phone in 2020, and putting the 5G and 4G on a giant extra chip means smartphones are going to use way more power, no matter which cell network you’re connected to…the move to separate modems will bring bigger, hotter, more expensive hardware, all for the sake of getting 5G in your smartphone, and you’ll be lucky to actually connect to a 5G network.” – Ron Amadeo, backup 1, 2
• “China’s crash will be much like its rise. Big, bold, brash, loud, all-consuming, and, in hindsight, completely inevitable.” – Zeihan on Geopolitics, backup
• “Tesla Semi(will never be built),  CyberTruck(will never be built) and robotaxis(will never be built).” – Live Monitor, backup
• “We have a large computer rust belt which nobody likes to talk about but it is companies like Cisco, Dell, Hewlett Packard, Oracle, IBM where I think the pattern will be to become commodities no longer innovate correspondingly cut their labor force and cut their profits in the decade ahead. There are many companies that are on the cusp. Microsoft is probably close to the computer rust belt. One that’s shockingly and probably in the computer rust belt is Apple Computer.” – Peter Thiel