Now that the end of 2009 is in sight, Panzer is in a contemplative mood because the Christmas muzak played all over Singapore is interfering with his brain waves resulting in the following Panzerian “predictions” for 2010.

These trends are all related to what he sees for the Singapore stock market and key trends going on from his Panzer street view. These predictions are made purely for entertainment value and because Panzer is trying to write blog posts more often. He now averages one every other week which isn’t very helpful to those who want to read more about financial freedom and his occasional quirky anecdotes about the not-so-secret diary of a CPA.

Panzer’s Predictions

1. Singapore Population will increase

This should be a no-brainer as the Government has said it intends to slow down by not stop the rate of immigration of people from PRC, India, south-east asia. Ultimately, the Government’s plan to develop Singapore as a global city can work only if there is enough human labour to supply businesses and industries who use are in Singapore to produce goods and services for sale and export.

2. HDB and general property prices will still rise (though more moderately)

So long as immigration continues and the overall population increases, the demand for homes will continue to increase. Given HDB’s supply is controlled by the government and is the monopoly for public and even semi-public (resale HDB) supply. The price of HDB will continue to rise if demand continues and supply is still relatively slow to catch up.

With more smaller families and singles, divorcees etc,  the demand for homes will increase as it will be less common to find 3 generations in the same roof. Ah gong and ah ma also want their own space even as ah girl and ah boy grow up, get married, move out and have kids. Don’t forget ah girl or boy who doesn’t get married will also aspire to have his/her own bachelor/ette pad.

3. STI will rise and fall but overall trend would be in line with GDP growth

So long as GDP growth is positive in Singapore and overall recovery in the world economy, STI should continue upwards. Of course, many (including Panzer) are banking on an election rally to pump up equity prices but would need to consider taking some profit off the table as the current administration is good at releasing good news to inject the feel good factor into voters before unleashing the unpopular policies very quickly after being elected back into power.

Thus, Panzer is still bullish from now until elections (anytime from 2Q to 4Q 2010) but would seriously sell some of his holdings if he feels the euphoria released by the mass media appears too good to be true.

4. Panzer’s return on investments should beat benchmark of 2 x fixed deposits (1 year) rates

Panzer counts himself blessed that he managed to achieve about 8% returns last year from realised capital gains from sales of equities, dividends, blogging income and interest from bank deposits. This is net of investment realised losses. While he is working to get passive income up to the magical $36,000 a year or so. The reality is that he has a long way to go and still have to continue to work until age 62 partly because employment income is still the main source of income and that Panzer knows his brain will rot if he doesn’t keep himself active even post 62.

5. Panzer’s will become 1 year older. He hopes he will be 1 year wiser

Panzer confirms that he will be 1 year older in 2010. The addition of a year to his age hopefully comes with an additional year of wisdom. He knows that his journey towards financial freedom has allowed him to do what he didn’t dare to do previously, be more aggressive in investing in equities and also to be more aware of portfolio management and also diversifying his sources of income.

Ultimately, the whole point of this journey towards financial freedom is not in just meeting the goal eventually, but learning what he needs to in order to become a better person in managing his life and his money.

What are your predictions for 2010?

Share with Panzer in the comments section.

Be well and prosper.

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