This one is interesting, he breaks it down into 32 easy ways the s&p 500 will gain 17% this year. Jim Cramer also has the same prediction of a 17% increase as well. TheStreet.com 32 Reasons Stocks Will Jump This Year Thursday February 1, 12:45 pm ET ByGary Douglas Smith, Street Insight Contributor This column was originally published on Street Insight on Jan. 30 at 8:40 a.m. ET. It's being republished as a bonus for TheStreet.com and RealMoney.com readers. For more information about subscribing to Street Insight, please click here. Last year around this time, I speculated on the 20 reasons U.S. stocks would rise a total of 15% for the year. This year, I have 32 reasons for a 17% total return in the S&P 500 for the year. I believe: 1. U.S. GDP growth will average 3.0% this year. My reasons: Housing- and auto-related weakness will subside, and the GDP deflator will subtract less from nominal growth as inflation continues to decelerate. 2. Americans' median household net worth will hit another all-time high. This will be due to home values remaining near record highs after a historic run-up, stock portfolios continuing to rise, wages continuing to outpace inflation and unemployment remaining low. 3. Consumer spending will accelerate back to above-average rates. The catalysts include more seasonally appropriate weather, a healthy job market, wages substantially outpacing inflation, rising stocks, a stabilizing housing market, pent-up demand, lower energy prices and rising confidence. 4. Housing sales are likely to improve modestly. This will lead to a dramatic decline in home inventories as new construction remains muted throughout the year. The average home price is likely to trend slightly lower through the first two quarters of the year, before a modest uptick into year-end leaves prices about even. 5. The unemployment rate will average 4.5% throughout the year. It has averaged a very low 4.6% over the last 12 months and has been lower than that during only two other periods since the mid-1950s. More technology, health care and financial jobs will help offset real estate-related job losses. 6. Americans' average hourly earnings will continue to rise well above the rate of inflation as measured by the consumer price index. U.S. AHE rose 4.2% year over year in December, substantially above the 3.2% year-over-year average for the last 20 years. Throughout the 1990s' economic expansion, AHE exceeded current annual rates of 4.2% during only four months. 7. Measures of inflation will continue to decelerate throughout most of the year, as commodities decline and global growth decelerates from current levels, with CPI averaging around 2.0%. This would be meaningfully below the 20-year average annual rise in CPI of 3.1%. The CPI rose 1.3%, 2.0% and 2.5% year over year during the last three months of the year. The CPI has been lower than current rates during only four other periods since the mid-1960s. 8. Consumers' irrational pessimism will lift. I'll go so far as to say that both main gauges -- the Conference Board's measure and the University of Michigan's Consumer Sentiment Survey -- of their sentiment will make new cycle highs, moving to levels normally associated with healthy economic expansions. While overall U.S. public sentiment is still depressed given the macro backdrop, I see some signs that pessimism is lifting a bit (anecdotal evidence and subindices of the confidence readings). This should make the many bears very nervous, because keeping the public excessively pessimistic on U.S. stocks has been one of their main weapons. 9. The 10-year yield will average 4.75% for the year as economic growth comes in around average levels, inflation decelerates further, the U.S. dollar remains stable to higher and international investors' demand for U.S. Treasuries remains strong. 10. The Federal Reserve will leave the fed funds target rate at 5.25% while making both hawkish and dovish comments throughout the year, depending on current market perceptions. I don't believe a move is coming, but I do believe a cut is more likely than a hike. 11. The U.S. dollar index will remain stable to higher. I see it trading in a range of 80.0 to 93.0 as the U.S. budget deficit continues to improve, U.S. economic growth improves relative to global economic growth, cracks in the euro develop and international demand for U.S. assets rises. 12. The U.S. budget deficit, which is currently 1.5% of GDP, well below the 40-year average of 2.3% of GDP, will continue to trend lower as healthy economic activity continues to boost tax receipts substantially more than estimates. 13. Corporate spending will rise more than expected. Companies flush with cash will gain confidence in the sustainability of the current expansion and spend on productivity-enhancing technologies. 14. S&P 500 earnings will rise about 8.0% for the year, still slightly above the long-term average of 7%. The most-cyclical companies will see a meaningful deceleration in growth, which will more than offset acceleration in other areas. 15. The mania for commodities will completely end. We'll even recognize a bear market in the sector as the CRB Index falls another 10% to 15% for the year. The end of the commodity mania will be viewed as the "pin that pricked the U.S. negativity bubble." 16. Oil falls to $35 to $40 per barrel as the extreme euphoria surrounding its push above $70 per barrel last year finally gets viewed as a major top. Among the catalysts I see for this outcome: * lower growth in the demand for oil in emerging-market economies * an explosion in alternatives * rising spare production capacity * increasing global refining capacity * the complete debunking of the hugely flawed "peak oil" theory * a firmer U.S. dollar * less demand for gas-guzzling vehicles * accelerating non-OPEC production * a reversal of the "contango" in the futures market * a smaller risk premium * essentially full global storage * downside speculation by investment funds I also expect oil to test $20 to $25 per barrel within the next three years. 17. The situation in the Middle East will "beat" very low expectations as Iran, with the government under fire due to rapidly deteriorating economic conditions, makes some concessions regarding its nuclear program and as the violence in Iraq actually lessens to some extent in the second half of the year. 18. The hugely positive effects from the meaningful decline in energy prices will continue to assert themselves throughout the U.S. economy and stock market.