Dollar Index hit 71 in March and has been oscillating around the 72-73 level for a few months now - remember that a collapse of the dollar is in no one's interest (except gold bugs).

So far the yen has strengthened by about five percent and the euro has gained about seven percent - both the Canadian dollar and the British pound are about flat.

3. It Will Be a Bad Year for U.S. Equities

The Dow and the S&P 500 Index will decline by 5 percent and the Nasdaq will gain 1 percent. Foreign stocks will continue to do better than U.S. stocks, but there will be fewer high-flyers than in 2007.

The Chinese stock market will gain more than 50 percent by summer and then lose most of the gains by year-end. The Japanese stock market will be one of the top performers in the world.

Perhaps a bit too optimistic here with double-digit declines so far nearly everywhere and lots of "low-fliers" overseas - perhaps a rebound by year-end. That must have been a typo with the Chinese stocks - "will lose 50 percent by summer" would have been a better guess and the Nikkei is looking quite sickly at the moment.

Aside from energy and big mining companies, it's been a horrible year for equities.

4. Short-Term Interest Rates Will Go Much Lower

The Fed will cut interest rates by a quarter-point at every meeting and at one meeting they will cut by a half-point putting the Fed Funds rates at an even two percent by year-end.

They'll continue to talk tough about inflation occasionally but no one will really care - inflation will be the least of the country's problems by summer.

Two percent by year-end looks like a pretty good bet though how we got there was quite a surprise. With round 3 (or is it round 4?) of the credit crisis about to get started, inflation concerns may get pushed off the front page for a while.

5. Energy Prices Will Continue to Rise

The price of crude oil will rise to over $130 per barrel before ending the year at $115 per barrel. Just like $3 gasoline wasn't a big deal, $4 gasoline won't be a big deal either - unless of course you use your car a lot and/or you don't make a lot of money. Then it will be a big deal.

Natural gas, a laggard over the last two years after a spectacular rise in 2005, will surprise to the upside in 2008.

At the time this prediction was made, crude oil was about $95 after having gained about 50 percent in 2007, so the $130 peak, which looks quite timid now, was actually rather bold.

Crude at $115 a barrel by year-end - that depends on how the hurricane season turns out and how much demand declines. Natural gas was something of a no-brainer as well - see the United States Natural Gas ETF (AMEX:UNG).

6. Gold and Silver Will Continue to Rise

Gold will spike to over $1,000 per ounce and finish the year just below that mark. Silver will hit $22 per ounce and end the year at $19.