Prosperous Predictions For 2015

It’s only one more day to a new year. What does 2015 hold for investors? I don’t have any working crystal ball that lets me see what the future holds. But, that doesn’t mean I can’t conduct any thought experiments to see what could go wrong or what could turn out very well in the upcoming year.

I’ve come up with two scenarios, one for a doomsday-like 2015, and one for a really prosperous 2015. You can check out the doomsday scenario here. But for now, it’s all rainbows and sunshine.

Year 2015

The huge boom in e-commerce has led to strong increase in global trade. Companies providing support services to e-commerce, such as logistics outfit Global Logistic Properties Ltd (SGX: MC0), see the demand for their services increase rapidly.

The recovery in the United States is gaining momentum and jobs are being created at an ever growing pace. As the largest consumer in the world, the United States’ recovery leads to strong demand growth in global trade too.

Similarly, Abeomics – Prime Minister Shinzo Abe’s bold policies to jumpstart the Japanese economy – start to show signs that it’s indeed kicking the Japanese economy awake. This leads to developing countries such as China and India being able to continue their fast pace of growth in order to feed the demand from USA and Japan. As oil prices remain low, most industries are able to operate at lower cost, freeing up cash flow and eventually leading to huge increase in capital expenditures to expand their businesses.

Innovations in all fields continue developing fervently. Financial innovation such as bitcoins and Alipay’s Yu’e Bao fund make their way to the global stage. This leads to a more efficient method of deploying capital to projects that might not be able to get funding through traditional channels. A better deployment of capital then leads to even more trade, further boosting the global economy.

As the global economy improves, governments in countries such as China and Singapore are able to relax the cooling measures for their respective property markets that have been put in place. The property sector is then able to shake off the cobwebs and resume growth, creating more jobs for the economy. Property developers such as CapitaLand Limited (SGX: C31) and Yanlord Land Group Limited (SGX: Z25) see great earnings growth as demand for their product (real estate) increase significantly.

2015 goes down in history as one of the best years ever for the global economy.

Foolish Summary

As the global economy grows, consumers start to feel better-off and spending on discretionary items will increase strongly. Consumer-product makers and retailers will stand to  benefit greatly from the boom.

All the above is just a thought experiment, but it does highlight what might go right in 2015.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Stanley Lim does not own any companies mentioned above