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Predictions For 2013

BOSTON (CBS) - Well 2012 did not disappoint me!

Last year I was concerned that corporations would continue to sit on a pile of cash and they have. But in their defense, they bought back nearly $400 billion worth of their own shares last year. They also paid out record dividends, of $281 billion.

I expected the stock market to be a roller coaster ride and it did not disappoint. 200-point swings are now the norm! The S&P was up 13% for the year, the NASDAQ up 16% and the DOW gained 7%.

The wild card for 2012 I thought would be the global economy. And it was. Causing more than a little volatility in the markets all year.

So what do I see in my crystal ball for this year? I think for the most part it's good. We managed to avoid the Fiscal Cliff. But what lies ahead with a dysfunctional Washington is impossible to second guess. We still must address the deficit and taxes.

Taxes were always going to go up no matter what happened. Two years ago, we were handed a 2% decrease in Social Security taxes. The government needs that money to fund the Social Security Administration so you will see that 2% coming out of your paycheck each week.

The job market will slowly recover. We have over 2 million workers relying on extended unemployment checks. We need to get them back to work.

Some companies will hand out modest raises and bonuses and 401(k) plans will see more matching. Kids graduating from college this year will see more hiring, but they still need a marketable degree.

Consumers will continue being frugal. Consumer spending accounts for about 70% of GDP and with less spending the economy will take longer to recover.

As the stock market and the housing market recover, consumers will begin to feel wealthy again. And they will begin to spend again. But not like they did at the beginning of this century and they will be a lot smarter about borrowing.

I believe 2013 will be a good year for the stock market, not necessarily double digits but positive numbers.

The wildcards for 2013: Our government. Our politicians are not interested in working together on the problems we are facing. They just want to be sure they get re-elected.

Number 2: The global economy especially Asia and Europe. We have no control over what happens outside the U.S. borders. We can influence but that is it!

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