My Dirty Dozen (and 1/2) Predictions & Trends for 2020

Issue #37 December 3, 2019

I abstained from filling your inbox with Black Friday or Cyber Monday promotions but I will be early on giving you my #WealthMatters 3.0 Top 12 Predictions for 2020. I welcome debate on the polarizing ones.

My 2020 trends & predictions

1) Blockchain IT investment breaks 8% of Enterprises - Blockchain Technology remains immature for enterprise use-cases but receives incremental new interest. (Visit here for a Top 10 Strategic Technology trends that Gartner sees in 2020

1.5) November 11 2020 “Singles Day” is a Sputnik moment for the next monetary world order - I believe that over $50B in consumer sales will be done in China on this day completely on a Chinese sovereign blockchain and crypto currency and will put the race for the next hegemony in full throttle.

2) The Media Bubble Expands then Explodes - The cost of traditional media/social media advertising is at a premium. This will be crippling to upstart and legacy retail and direct-to-consumer brands through 2020 because of election cycles, and we will see a double-digit uptick in the # of failures in the retail and newspaper business.

3) Large Scale Consolidation- Large premium M&A transactions and industry consolidation will peak in 2020 and continue through 2021. Part of the causality will be the cost of traditional media/social media advertising being priced at a premium. This will be crippling to upstart and legacy retail and direct-to-consumer brands through 2020 because of election cycles, and we will see a double-digit uptick in the # of failures in the retail, e-commerce, consumer brands, and newspaper/media businesses.

4) VC firms take a bath - Exit values for VCs harvesting portfolios from their 2008-2012 funds will be devastatingly low and many will fail to raise new funds or drive a positive IRR before expiration.

5) The great liquidity trap- U.S. Consumers will hoard more and more cash by mid-year and the Fed will be forced to QE4 against headwinds of a classic liquidity trap.

6) Tesla shifts into high gear - Tesla will go private or be acquired by Apple in 2020 and announce a first of its kind Mobility-as-a-Service full-scale month-to-month tiered subscription program (starting as low as $195 per month with insurance included disrupting the current average driver budgets) to its Model 3 targeting Millenials and fixed-income boomers and scale it with the Cybertruck and other premium models in 2022. If done right this will make them the largest U.S. automaker by revenue in the world by 2027!

Tesla is uniquely positioned to scale Mobility-as-a-Service since no other manufacturer can leverage the unique capabilities of 1) open APIs (insurance and other data feeds to optimize insurance algorithms), 2) Over-the-Air updates to the entire fleet (prevents recalls), 3) low wear and tear/high residual values due to all-electric drive train (my friends at Carmiq/Tesloop, for example, have a 6-year-old Model S with over 500k miles and have spent only $11k in maintenance) 4) the nationwide supercharger network and 5) no dealer networks to unwind, built on outdated product-centric (vs customer-centric) distribution models.

For more context on demographic drivers of this prediction read 5 Reasons Why Millenials Love Subscriptions and also see some macro charts below that quantify the current state and financial forces that are ripe for disruption.

7) “Blue Horseshoe Loves $BTC”- BTC will be accumulated by more Wall Street players through a classic “FUD (Fear Uncertainty and Doubt” campaign and futures strategy that drives post-halving price as low as $5500 before it spikes to All-Time Highs in Q3 and Q4 and stays true to the stock-to-flow model. Three macro charts below help you understand where we are. My price prediction is “gut-level” more than technical and you should always “Do Your Own Research”. This is a highly speculative investment and uncorrelated asset class and you should never invest anything you aren’t willing to lose.

8) Re-election followed by removal- Michael Bloomberg will split the DNC primary vote and fail to gain enough of the hard left and Donald Trump will be re-elected and likely removed/resign from office in 2022 once the economy contracts harshly and the RNC prepares for the 2024 cycle.

9) Peak Influencer Starts to Decline- Consumer Attention will shift off of social media platforms like FB, Instagram, and even the scaling up of TikTok in 2020-2021 and move more fully into encrypted messaging platforms.

10) Market Volatility Increases - We will see an acceleration in fear-based, and anger-based marketing as we are still 4-5 years away from peak crisis as volatility creates loads of arbitrage.

11) Home Values flatten despite low-interest rates - I believe we will see peak home prices on the resale market and new home market in most major cities in Q1-Q2 and declines thereafter.

12) Consumer Debt Grows to new all-time highs - Consumer debt has already surpassed pre-2008 crisis levels as of 2019, and the two charts below feed into my prediction that the ultimate setup for a massive correction in 2021-22 will be set in 2020 as consumers continue to pile on record-high levels of debt, while banks and credit card issuers will see one last pile of profits before taking massive losses in early 2021.

Recommendations:

Remember as you move into 2020 to protect your cognition. Feed your soul with good and simple activities. Disengage from toxic relationships. Unplug more consciously this year. Simplify your holdings into a focused and personal strategy. Value access over ownership before you are forced to.

Massive wealth creation can be found by looking for arbitrage opportunities in other people’s ignorance and apathy. Play it smart and act dumb as a protective overall strategy. ~Chris

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