Summary of Financial Markets and Economic Forecasts

Gold Bull Market set to resume, targeting a rally to initially $847 and then $900 by the end of this year.

25/3/07 - Despite recent rally, gold looking weak in the immediate term, though has plenty of time to fulfill the forecast.

The Uranium bull market shows no signs of halting its trend, next target is $100, then $120, before the end of this year.

25/3/07 - Uranium passed $100

Coffee Bull Market Brewing - Coffee to make a base and target a rally to $152 and then eventually $172

20/3/07 - Still not made the base, needs more time to develop.

Short-Term - The British Pound is targeting a significant downtrend to $1.8600 by early May 2007. Resistance to negate the downtrend is at $1.9661.

21/3/07 - The rally to beyond 1.9661 has negated this short-term forecast.

Long-Term - It is only a matter of time before the British Pound breaks above $2.00 to target a new high of possibly $2.10. In the meanwhile expect range bound activity between $1.99 and $1.80. The Breakout to $2.10 may prove to be short-lived and could coincidewith the end of the GBP Bull market as has occurred on previous runs to $2.00.

The same old battle between inflation and deflation expectations, with currently inflation taking the upper hand. The economy is expected to continue to slow into end 2007. The US should end the year with between 2.25% and 2.75% GDP growth. Which by US standards is low.

The UK economy like the UK Housing market is remarkably resilient.I expect the UK economy to continue growing during 2007, regardless of what happens in the US, and is targeting healthy growth of between 2.5% and 3% GDP by year end.

The Housing market is expected to remain weak going into the Summer when there is a possibility of a bounce, i.e. stablisaition for the period going into September 07. Thereafter the market may again resume the downtrend that has been in force for over 12 months.

20/3/07 - Subprime hits headlines in Feb / March, weakness continues as forecast into Summer

UK Interest rates to rise to 5.75% by about Sept 07, as the Bank of England does battle with inflation.

15/3/07 - Next rise to 5.5% is likely in May.

Military Strikes Against Iran ? - There has been talk about strikes / military action against Iran for some 2 years now. Though with the US building naval forces up in the Gulf, the risks have increased somewhat. However the probability is still for NO strikes against Iran this year.

18/3/07 - Kidnapped British Navy Personnel, despite the rhetoric unlikely to impact the scenerio of no action against Iran. They will probably be released within a month or so. There is NO chance of any British attempt at rescue, ZERO.

Long-Term - Volatile trend during the year, Dow Jones to end 2007 up for the year, unable to say how high as there are negative drags on parts of the indices such as the Housing market slump which is expected to continue at least into mid-year. Therefore a low in the Dow Jones can be expected mid-year. But fundamentally unlike many analysts, I just don't see the stock market as being expensive.

22/3/07 - Held up strongly during the recent sell off, though major test in May / June still due, will determine how strong the Dow will be going into the 2nd half of 2007/

Shanghai Index to be weak first quarter, then should rally for much of the year to continue its multi-year bullish trend on the back of a strong economy and profits growth.

7/3/07 - Sell off in late Feb was a good buying opportunity - Expect more selling around mid year for another op.

I expect India's Bombay Stock Exchange Index to be much weaker than China, due to poor infrastructure. And same as with China, I expect a weak first quarter, and a weaker rally into the year end for possibly a small gain for the year. Though I would view any significant sell off in the mid-year as a good buying opportunity for the long-run

7/3/07 - India lagging China, more weakness expected. Watch mid-year sell off for possibly buying opp.