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There is an old joke that economists only make predictions so that the weather guys have someone to laugh at. In much the same spirit, once a year this column also makes some predictions — but only so the economists have something to giggle over.

With that caveat in mind, here are 10 things that might (or as likely not) happen in 2011:

No. 1. The bull market returns. Actually we’ve already been in a bull market for more than a year. Just take a look at the figures. But in the early stages of a rising equity cycle, no one says it’s a bull market. First they call it a dead-cat bounce. Then they call it a bear-market rally. By the end of 2011, the penny will have dropped. We’ll be officially back in bull territory. By the close of the year, everyone will have started piling back into equities again.

No. 2. The alternative-investment industry crashes. The main driver of hedge funds and private-equity funds was the search for yield. With stock markets in the doldrums, interest rates cut to almost nothing, and bond yields at record lows, investors were desperate for any kind of meaningful return on their money. They were willing to listen to slick hedge-fund managers who promised to make 30 percent a year on high velocity yak-hide arbitrage. Next year, interest rates will be rising, and so will bond yield and equity returns. Why bother paying a fortune to hedge- and private-equity fund managers, few of whom deliver on their promises, when you can get pretty decent returns from mainstream investments?

No. 3. Venture capital returns. The start-up industry took a terrible beating from the dot-com crash. But as a rough rule, a decade is long enough for the financial markets to forget everything. There are fantastic opportunities out there. Smartphone apps. Social networking. Alternative energy. Africa. The markets always have space for some blue-sky optimists — and 2011 will be the year that venture capitalists fill that slot again.

No. 4. France gets smoked out in the euro crisis. Somehow France has managed to get itself grouped along with Germany as one of the strong euro nations. But it runs a bigger budget deficit than Italy. It has chronic unemployment and little growth. Crucially, it has the greatest resistance to reform. The merest suggestion of extending working hours, or retirement ages, or reforming public services, prompts massive demonstrations. It can’t last. Next year will be when France wallows with Ireland, Greece, Portugal and Spain.

No. 5. The Apple Inc. backlash starts. We used to think International Business Machines Corp. was sort of sinister. Then it was Microsoft Corp. But which business today has far too much power, is run by control freaks and puts profits before principles? That’s right. The world’s third-biggest company, measured by market value, is about to discover that the line between cool upstart and ugly monopolist is a very thin one.

No. 6. The German model is back in fashion. The words German and fashion go together about as well as Greece and solvent paydayloans. But in a world trying to figure out how you get out of a debt crisis, the Rhineland model of capitalism is suddenly going to seem very appealing. Lots of mid-size companies, with huge technical expertise, low debt and skilled workforces exporting niche products to the whole world — that sounds like a pretty good formula for success in the 2010s. By the end of 2011, expect every chief executive on the planet to start talking earnestly about how they are looking to a German management model as their guide.

No. 7. Lloyds Banking Group Plc gets broken up. The hastily assembled merger between two of Britain’s largest banks, Lloyds and HBOS Plc, increasingly looks like one of the more catastrophic decisions made during the height of the credit crunch. It is too powerful. This will be the year it gets split apart.

No. 8. Iceland teaches the world a lesson. Two years ago, every government in the world bought into the idea that you had to bail out your banks. If they collapsed, you would go straight back to the Stone Age. One country defied the consensus. Iceland couldn’t afford to keep its banks going. What happened? There’s been pain, sure, but from next year on the economy should be growing again, inflation is under control and interest rates are coming down. If Iceland keeps recovering, only one conclusion is possible: You don’t need to bail out banks after all.

No. 9. Russia puts the R back in BRIC. We’ve heard a lot about the rising economic power of Brazil, India and China. A lot less has been heard about the R in the BRICs - - Russia. It tends to get dismissed as a raw materials supplier with an authoritarian government. But it’s trying to recreate itself as a technology powerhouse — look at the plans to create a new Silicon Valley in the Moscow suburb of Skolkovo. Crazy? Remember, this was the first country to put a man into space. Russia has always been scientifically advanced. If it can bring its brains and businessmen together, it could yet outshine the B, I and C in the acronym.

No. 10. A backlash against Christmas e-cards. Do I really need festive greetings from a small bank in Latvia I’ve never spoken to? Is that Austrian management consulting firm sincere in wishing me the best for the holiday season? I doubt it. Listen up guys. It’s not thoughtful. It’s not touching. It’s spam. Frankly, I’d rather get another e-mail from that friendly Ukrainian company that supplies Viagra without a prescription. By Christmas 2011, sending out e-cards will be socially unacceptable — and not too soon.

(Matthew Lynn is a Bloomberg News columnist and the author of “Bust,” a book on the Greek debt crisis. The opinions expressed are his own.)

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West African leaders are giving the man who refuses to leave Ivory Coast’s presidency a final chance to hand over power and are threatening to remove him by force if needed, though doubts exist about whether the operation could be carried out.

Meanwhile, the U.N. refugee agency said at least 14,000 people have fled the violence and political chaos in Ivory Coast, some walking for up to four days with little food to reach neighboring Liberia. At least one child drowned while trying to cross a river.

The U.N. has said at least 173 people have died in violence over the disputed presidential runoff election held nearly one month ago. The toll is believed to be much higher, though, as the U.N. mission has been blocked from investigating other reports including an allegation of a mass grave.

West African leaders from the regional bloc ECOWAS late Friday threatened a military intervention if Laurent Gbagbo does not step down from Ivory Coast’s presidency. On Sunday, Sierra Leone’s information ministry said that three leaders from the region would pay him a visit.

“In the spirit of brotherliness in Africa, three presidents have been nominated by their colleagues to confront Mr. Gbagbo in Abidjan to encourage him to leave office without delay,” the ministry said. “The three presidents can fly back with Mr. Gbagbo, as all ECOWAS countries are prepared to grant him asylum.”

Gbagbo has shown few signs that he plans to go, though, and his security forces have been accused of being behind hundreds of arrests, and dozens of cases of disappearance and torture in recent weeks. A Gbagbo adviser has said he does not believe their supporters are behind the attacks.

ECOWAS has not stated a deadline for Gbagbo to hand over power to Alassane Ouattara, whose victory has been acknowledged by the U.N., U.S., the African Union and the European Union.

While the threat of a military intervention creates pressure on Gbagbo, Africa security analyst Peter Pham said there are “serious doubts that ECOWAS has the wherewithal to carry it out.”

“None of the ECOWAS countries has the type of special operations forces capable of a ‘decapitation strike’ to remove the regime leadership,” said Pham, who is the senior vice president of the National Committee on American Foreign Policy in New York. “That leaves the rather unpalatable option of mounting a full-scale invasion of the sort that would inevitably involve urban fighting and civilian casualties.”

Pham also said there is “little chance” that the U.N. would allow its peacekeepers to get involved in such an effort. “The precedent would make it very difficult to get future agreement for deployment of such missions by host countries,” he said.

Diplomatic pressure and sanctions have left Gbagbo increasingly isolated, though he has been able to maintain his rule for nearly a month since the disputed vote because he still has the loyalty of security forces and the country’s military.

Even that, though, may disappear if he runs out of money to pay them. Gbagbo’s access to the state funds used to pay soldiers and civil servants has been cut off and only Ouattara’s representatives now have access to the state coffers.

Senior diplomatic sources, speaking on condition of anonymity because of the sensitivity of the issue, say that Gbagbo only has enough reserves to run the country for three months.

Gbagbo’s spokesman Ahoua Don Mello on Saturday denounced the decision by West Africa’s economic and monetary union to give Ouattara’s government signing privileges on state accounts. He called the move “illegal and manifestly beyond their competence.”

The meeting of regional finance ministers that issued the freeze “overstepped its stated prerogatives by interfering in the internal affairs of a member state of the union,” Mello said.

Gbagbo’s government has denied rumors that state salaries wouldn’t be paid, and in spite of the financial freeze, civil servants received their paychecks the day before Christmas Eve.

While Ouattara now has access to government funds, he is struggling to assert his legitimacy despite widespread international support. Troops loyal to his political rival continue to encircle the hotel where he has taken refuge under the protection of some 800 U.N. peacekeepers since the election.

“After these long years of crisis, the Ivorian people deserved to rejoice in our democratic advancement,” Ouattara said in a Christmas Eve address. “But former president Laurent Gbagbo has decided to turn a new page of violence and uncertainty, aggravating every day a little more the suffering of Ivorians.”

In recent days, the United Nations has expressed alarm about the actions of men who are believed to be Gbagbo loyalists. The world body reported Thursday that heavily armed forces allied with Gbagbo, who were joined by masked men with rocket launchers, were preventing people from getting to the village of N’Dotre, where the global body said “allegations point to the existence of a mass grave.”

The U.N. did not elaborate on the possible victims, though it has expressed concerns about reports of being abducted from their homes at night.

Ivory Coast was once an economic hub because of its role as the world’s top cocoa producer. A 2002-2003 civil war split the country into a rebel-controlled north and a loyalist south. While the country officially reunited in a 2007 peace deal, Ouattara draws his support from the northern half of the country, where he was born, while Gbagbo’s power base is in the south.

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General Motors Co. is renewing its ties to a Montana mining company that provides precious metals for emission-reducing catalytic converters, according to documents filed with federal regulators Thursday.

The deal restores a decade-long relationship that turned sour after GM filed for bankruptcy protection and abruptly dropped its supply agreement with Stillwater Mining Co.

That move in July 2009 drew a sharp backlash from Montana’s congressional delegation and its Democratic governor, Brian Schweitzer.

They criticized the Detroit automaker _ then majority owned by the U.S. government _ for abandoning an American company in favor of cheaper foreign suppliers. Stillwater executives asked a federal judge to block the move but were denied.

“We kind of made peace with (GM) a while back and we’re obviously moving ahead,” said Greg Wing, Stillwater’s chief financial officer.

Stillwater operates the only platinum and palladium mines in the U.S., southwest of Billings in the Beartooth Mountains.

Terms of the new deal released Thursday show the company will provide palladium to GM for three years beginning in January. The price will be based on the market average at the time of the sale.

The deal lacks ceiling and floor prices _ a feature in past contracts but one that the automaker cited in part as a reason to cut ties last year.

Wing said strong precious metal prices gave Stillwater the confidence to agree to the new terms. He said the company has $200 million in cash on its balance sheet as added financial security.

Another contract, with Ford Motor Co., is due to expire at the end of the year. Wing said Stillwater is in discussions with automakers about future contracts but declined to offer details.

The renewal of its relationship with GM caps a string of good news for Stillwater after it was battered over the past two years by low metals prices.

In November, the company announced plans to spend $68 million on the expansion of its mines, located near the towns of Nye and McLeod. Days later, the company closed its purchase of a Canadian company with substantial platinum and palladium reserves in a deal valued at $140 million to $160 million.

Stillwater’s former majority stockholder, Russia’s Norilsk Nickel, sold its stake in the Montana company this month for about $900 million.

Stillwater shares fell 6 cents to close Thursday at $20.65. GM shares fell 11 cents to $34.81.

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OTTAWA

Greece’s governing Socialists won a key budget vote in Parliament early Thursday, calling for deeper austerity measures in the crisis-hit country and promising to avoid default despite a soaring national debt.

Lawmakers early voted 156-142 in favor of the 2011 budget, braving a third year of recession to trim euro5 billion off the budget deficit, through higher consumer taxes and cuts in health and defense spending. Two opposition parliament members were absent.

The latest cuts are needed for the country to continue receiving loans from the euro110 billion ($144 billion) bailout fund created for Greece by European countries and the IMF. But the government is facing growing hostility from Socialist-dominated unions and even critics within its own party.

Prime Minister George Papandreou insisted the austerity measures _ including pay cuts for state workers, sale tax hikes, and axing labor rights _ were working.

“We will not go bankrupt. In 2012 we will return to a path of growth … we will not give speculators or ratings agencies the pleasure,” he told parliament shortly before the vote.

The budget calls for continued tightening in Greece’s euro228.4 billion economy in 2011, and is aimed at lowering the deficit to euro17 billion or 7.4 percent of GDP.

But the country’s debt-to-GDP ratio is set to exceed 150 percent next year, from 127 percent in 2009, leading to ongoing fears of eventual default.

Papandreou has promised to return to the bond market sometime in 2011, but warnings this month from three ratings agencies that Greek bonds are likely to suffer fresh downgrades have checked those expectations check cash advance.

Labor unions, meanwhile, are stepping up protests.

The 24-hour strike Wednesday by metropolitan transport workers caused morning traffic jams as commuters went to work by car or taxi. National rail workers also walked off the job, paralyzing train routes, though flights and ferries were not affected.

Outside parliament Wednesday, about 1,000 people took part in a peaceful protest against the cutbacks, organized by Greece’s two largest unions. Protesters held banners reading “Ban layoffs, write off the debt,” and “Open-ended strikes until our final victory.”

Many were urban transport employees incensed at recent salary cuts and the prospect of radical restructuring _ without layoffs _ for their state-run companies, most of which are rapidly losing money.

Athens transport unions have held intermittent strikes over the past three weeks against the reforms, which the government argues are necessary to keep urban transport running.

Papandreou’s government has promised more unpopular reforms early next year, including the liberalization of tightly regulated professions, and the restructuring of more troubled state companies.

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Treasurys are inching lower in light trading despite another round of bond-buying from the Federal Reserve.

Treasury prices had been slightly higher Tuesday ahead of the New York Fed’s $7.8 billion purchase. But soon after the Fed announced that it bought the Treasurys, prices slowly sank.

In afternoon trading, the 10-year note is down 6.25 cents on the day for every $100 invested. The yield is hovering at 3.35 percent.

Treasury yields have been rising steadily since early November even after the Fed launched a bond-buying program intended to keep interest rates low. The 10-year yield reached a seven-month high of 3.56 percent Dec. 16.

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CLAYTON

European Union leaders agreed to amend the bloc’s treaties to create a permanent crisis- management mechanism in 2013, while divisions flared over steps to prevent concern over debts from engulfing Portugal and Spain.

Germany, the biggest contributor to Europe’s bailouts of Greece and Ireland, pushed through an accord to set up a system that would allow financial aid “if indispensable to safeguard” the euro area and might force bondholders to bear some of the costs of future rescues.

Consensus on the mechanism to take effect in a little more than two years should lead to “a certain calming of the markets,” Austrian Chancellor Werner Faymann told reporters at an EU summit in Brussels today.

Most European bond markets fell today, as Germany’s refusal to boost the current 750 billion-euro ($1 trillion) emergency fund stirred concern that Europe hasn’t found the right formula for battling the debt crisis that threatens the euro.

Driven by a German public outcry against propping up fiscally reckless countries, Chancellor Angela Merkel ruled out putting more money on the table, retooling the support facility enacted after the Greece rescue to enable it to buy troubled governments’ bonds or further entwining Europe’s economies through joint bond sales.

“Let’s be candid,” International Monetary Fund Managing Director Dominique Strauss-Kahn said in an interview scheduled to air tonight on “Charlie Rose” on PBS. “The European Union needs a little more time, until maybe the beginning of next year, to be able to produce a comprehensive package.”

Spanish Auction

Spain and Greece were in investors’ sights today. A Spanish bond auction raised 2.4 billion euros, less than the target. The extra yield that investors demand to hold Spanish 10-year bonds over German counterparts rose 3 basis points to 245 basis points, a day after Moody’s Investors Service said it may cut its credit rating.

Moody’s today warned it’s considering a “multi-notch” downgrade of Greece, which is rated below investment grade after dragging Europe into the sovereign debt crisis and obtaining a 110 billion-euro aid package in May. Greece’s 10-year spread slipped 2 basis points to 881 before the Moody’s announcement.

“There is a situation of European gridlock again with Germany blocking actions to make progress,” said Nick Kounis, chief euro-region economist at ABN Amro NV in Amsterdam and a former U faxless payday loans.K. Treasury official. “There is a high risk of the crisis re-escalating and maybe now it’s the quiet before the storm in markets.”

EU President Herman Van Rompuy will hold an interim press conference later tonight. The summit is slated to end around 1 p.m. tomorrow.

Irish Bailout

German insistence on cutting bond values when countries get into trouble in the future triggered the latest phase in the debt crisis, culminating in an 85 billion-euro support package for Ireland on Nov. 28.

While costs for bondholders aren’t mentioned in the two- sentence amendment, the leaders plan to endorse a Nov. 28 decision by finance ministers that writedowns may take place on a “case by case” basis in accord with IMF Fund practices.

Merkel needed the amendment to prevent German high-court challenges to the future aid mechanism, which the EU wants to get up and running when the current rescue package lapses in mid-2013.

The compromise text reads: “The Member States whose currency is the euro may establish a stability mechanism to be activated if indispensable to safeguard the stability of the euro area as a whole. The granting of any required financial assistance under the mechanism will be made subject to strict conditionality.”

‘Last Resort’

Germany had pushed for the amendment to say that any financial assistance will only be offered as a “last resort,” EU officials said.

Last overhauled a year ago, the treaty is the EU’s equivalent of a constitution, binding on EU institutions in Brussels and on national governments’ handling of European affairs. All 27 countries, including the 11 outside the euro region, would need to ratify the amendment.

Britain, the largest of the non-euro states and with a soaring deficit of its own, will back a future aid facility as long as it doesn’t have to pay in, Prime Minister David Cameron said.

“We do need a new mechanism to help the euro zone sort out its problems and its issues — that’s important for Britain,” Cameron said in Brussels. “But we do need to make sure that Britain is not liable to spend money under that mechanism.”

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Belgium had the outlook on its debt rating lowered to “negative” from “stable” at Standard & Poor’s Ratings Services because the country’s political stalemate makes it vulnerable to rising borrowing costs.

S&P may cut Belgium’s AA+ sovereign credit rating by one step within the next six months should the seven parties involved in coalition talks fail to form a government “soon,” the credit agency said today in a statement. It may also cut the rating within two years should the next government fail to stabilize public debt and improve political cohesion.

“Belgium’s current caretaker government may be ill- equipped to respond to shocks to public finances,” Marko Mrsnik, a credit analyst at S&P in Madrid, said in the statement. “The federal government’s projected 2011 gross borrowing requirement of around 11 percent of GDP leaves it exposed to rising real interest rates.”

Belgium has increasingly been compared with so-called peripheral nations such as Greece, Ireland and Spain as the leadership vacuum constrains efforts to cope with Europe’s third-biggest debt as a percentage of gross domestic product. The nation continues to operate under a caretaker administration six months after inconclusive elections as Flemish and French- speaking parties are still sparring over whether to grant more fiscal autonomy for the country’s regions.

Extra Yield

The extra yield investors demand to hold Belgian 10-year bonds instead of benchmark German bunds increased as much as 8 basis points to 108 and was at 101 basis points at 5:11 p direct payday lenders.m. in Brussels. The spread, a measure of the risk of investing in Belgium, widened to 139 basis points on Nov. 30, the most in at least 17 years.

National Bank of Belgium Governor Guy Quaden on Dec. 6 called for the formation “in the coming weeks” of a “stable” and “lasting” federal government that should present a detailed plan outlining Belgium’s efforts to balance its budget by the end of 2015, as agreed with the European Commission. The budget deficit will narrow to 4.7 percent of GDP next year from 4.8 percent in 2010, according to the central bank’s projections.

“Belgium should learn to accept that it is on the markets’ radar screen and stop hiding behind the German economy’s locomotive,” Ivan Van de Cloot, chief economist at Itinera Institute, a non-partisan think tank focusing on Belgian policy reform, said in a telephone interview from Brussels. “It’s not as if Belgium has suddenly fallen off a cliff: it’s been suffering from internal bleeding that continues to weaken the country.”

The next federal government will need to rein in health- care spending, cut the number of civil servants, prepare a pension reform and improve tax-revenue collection, the International Monetary Fund said in a report published yesterday. Any unforeseen additional revenue should be used to cut government debt, the Washington-based IMF said.

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