StockTwits has organized a new stream of tweets focused on the symbol $TWENTYTEN for the community to make predictions and share their views about the year to come.  I encourage you to participate by writing a blog post or simply tweeting your predictions or views.  Just tag your tweet with the symbol $TWENTYTEN.  Nothing in this post or on this site should ever be considered investment advice or an invitation to buy or sell any security.  Please feel free to leave comments or argue against my predictions, I love the banter.  I may add to this post as we approach the new year.

The Market

After two years of massive swings in each direction, the market settles down.  The trading range in the S&P 500 $SPX will not exceed 30%.  In 2008 investors dumped everything.  In 2009 investors bought everything.  In 2010 we get back to a more “rational” market as investors start making bets on companies instead of asset classes as a whole.  While the past two years have been marked by a high level of correlation amongst many assets and asset classes, in 2010 we will see this break down.  2010 will be the year of the stock picker.

Google $GOOG will buy Twitter $TWIT because they want to own the world and know “real time” is the next step in search.

The Google phone, also known as the Nexus, will be the first to take a real bite out of the $AAPL iPhone.  Google’s business strategy was insanely good.  Release your excellent operating system on a bunch of marginal hardware, get everyone else to pay for the advertising to introduce said operating system, Android, build an awesome piece of hardware yourself, launch it with a ton of buzz, own the hardware and the software and take a real bite out of the iPhone.

Facebook $FBOOK will go public, it’s too big to be bought at this point.

Palm $PALM will either trade under six dollars at some point, or be acquired, maybe both.

Financials as a whole $XLF will continue to lag, along with the homebuilders $XHB.  Healthcare $XLV will take the lead, outperforming the market as healthcare reform is finally out of the way, one way or the other, and investors are able to place bets knowing what the new rules are.  I’m especially a fan of the electronic medial records providers like Athena $ATHN and Cerner $CERN.

Retail investors will lose money trying to ride the gold miner $GDX train, getting whipsawed all over the place.  Smart fund managers like Paulson will make a killing in gold and gold miners.  Gold $GC_F will hit 1300 dollars.

Citibank $C will not trade over 7$.

Bank of America $BAC will spin off Merill Lynch $MER.

Economics

While the low end of the housing market will only fall another 5-7%, the upper end, above 1,000,000 will fall another 10%.

Commercial real estate will fall another 10%, but large well capitalized REITs will benefit from their ability to prey on distressed situations, setting themselves up for a positive year.

New York City residential real estate prices will continue to fall.  Phantom supply from recent construction that was turned rental will hit the market after developers default on their debt and banks take control, willing to sell at any price to liquidate inventory.

The official unemployment rate, which stands just north of 10%, will not dip below 8% by the end of 2010.

The Federal Reserve $FED will raise interest rates to no less than 2% by the end of 2010.

Politics and International Relations

Iran will announce that it has the capability to build a bomb, but won’t overtly say they’ve built one.  Neither Israel or anyone else will attempt a military strike on Iranian nuclear facilities.

No less than 5 senators or governors will be disgraced by some type of scandal.

Technology

Starting with AT&T $T, telecom providers will begin publicly restricting the bandwidth used by mobile internet devices as their networks literally choke on data.  I have the feeling that this is already happening in some form or another as they track massive network usage on my iPhone and degrade my service because of it. The war for net neutrality will become a headline topic as the telecom giants fight the edge developers for control over the future of the internet.  If you think that Verizon’s $VZ network is any better, just wait, they will choke on data as well.  The network providers will partition the network and charge an extra fee for your data to be priority.

Cloud computing will take over your computer experience like never before.  Soon, you will subscribe to programs in the cloud and access them over the internet instead of hosting them on your personal machine.  You may already be using Google docs, Pandora Radio, or Lala, the cloud based music service recently bought by Apple, but you haven’t seen anything yet.  The Google Chrome OS will usher in a new paradigm in how we interact with our computers.  Companies like Rackspace Hosting $RAX will continue to grow and are solid investments going forward.  Sales of netbooks by $HPQ will continue to grow as the computer requires less and less, everything is moving into the cloud.

I’m not a huge fan of location based services like fouresquare, I have no desire to tell people where I am at all times.  I don’t believe other’s will choose to make this information public in a massive way either.  But……location based marketing will take off in 2010 and a company will come to the forefront and rule the space.  You will download an application to your mobile internet device which will recognize you are walking into a certain store, let’s say Urban Outfitters $URBN, it will know your previous purchases and offer you discounts tailored to your history when you walk into the store.  It’s already starting with Google.  It will be huge, and you will love it, no more clipping coupons.

Mobile payments through services such as Square will be ubiquitous.  You will be able to pay for a t-shirt in the stadium parking lot by sliding your credit card through a little reader attached to an iPhone.  Once again, it will be awesome and you will love it.

Mobile video will be all the rage with USTREAM on your mobile phone.  You will broadcast your kids soccer game live to your husband, or wife, traveling on business.  Is this StarTreck shit or what!

Apple will introduce a tablet device, it will sell over 5,000,000 units in the first three months.

The Large Hadron Collider (CERN) in Switzerland will create miniature black holes, the earth will not be sucked into one of them, and if it is, you won’t be around to bash me for being wrong.

Other

Plans will be announced by the NHL to move a hockey team to Quebec within three years, most likely the Phoenix Coyotes, Atlanta Thrashers, or Tampa Bay Lightning.

Derek Jeter will be publicly embarrassed by something, no one is that perfect, everyone has skeletons, I love you Jeter but no one’s a saint.

Tiger Woods will NOT go on Oprah with Elin, and @stein will owe me a hamburger.

The brokerage firms put out price targets for most major assets, along with average prices for most commodities so that clients can hedge their exposure.  Let me make this very clear, the only time when price targets make sense is when you are a deep fundamental investor and are willing to buy or cover when things look ugly and sell or short when the market is in love.  I have such a great disdain for much of the sell side community, I won’t even get started.  Ignore these predictions, all they are is marketing.  Ignore anyone who tells you they know where an asset will trade any more than 6 months from now and are willing to put money on that prediction.  It’s fun taking a guess at where things will fall in the months and years to come, but as a trader, price is king.  Pay attention to price above all else, allow it to confirm or refute your thesis.

I wish you all an excellent new year, and hope to see your predictions in the days and weeks to come.