I was tempted to make up predictions for the stock market. That’s pointless, of course, since I can’t really know what will happen over the course of twelve months. The coming months aren’t likely to bring much improvement until the debt crisis in Europe is resolved or fades away. That could happen in a few months, but it could just as easily drag on all year. And there will certainly be unexpected events that will crop up.
None of that causes me to despair. The first reason that I think 2012 is going to be a great year is because there’s a whole world of opportunities out there for my money. I am currently invested in Canadian stocks and an ETF, but I could just as easily invest in fixed income, in commodities, outside of Canada in the US or in emerging markets. Alternatively, if I decide I don’t mind working harder, taking more risk and having more direct control, I could buy a (small) business outright. Because the world is so large and the conditions are always changing, there should always be somewhere that presents opportunity.
This is the view that Peter Cundill took, according to his biographer in the book “There’s Always Something to Do.” This was a view that was shared by the RBC analyst I listened to a few weeks ago, who found European companies to be very cheap; one example was Renault (if I recall correctly), where the car company is free after accounting for cash on the balance sheet and minority interest in other car companies.
There are areas that have come through the recent economic turmoil mostly unscathed. Alberta is a good example. Our oil, gas and other natural resources are still in demand. Our population continues to grow, especially since we’re a destination for immigration. There was already lots of money here from the recent oil boom, and we weren’t over-leveraged. Our government has taken a fiscally responsible approach (relatively-speaking) to revenues and programs. There must be other regions that have similar strength, such as Australia, Chile, areas in China or Eastern Europe. I don’t know for sure, because I haven’t yet taken the time to look closely, but these are the areas I would look at first.
The other reason that I feel 2012 is going to be a great year is because I’m going to do what I can to make sure it is. A quote springs to mind: “The best way to predict the future is to create it.” (Peter Drucker, Abraham Lincoln and Molière all seem to have said this.) I’m prepared to do everything I can to make 2012 a great year for me. I’ll volunteer for causes that are important to me. I’ll meet people who share my values and find people who want to work together. I’ll improve my capabilities for strategy, leadership and cooperation. I’ll work for income and I’ll work toward a new degree (a Masters of Education).
Even if everything around me falls apart, I plan to make 2012 a great year.