Readers have some predictions for the new year and beyond. “If 2011 was Occupy then 2012 will be long hot summer…”
Another said, “I predict OWS will regain momentum, hone in on a few major points, and possible field a leader. Economy will remain in ’suspended animation.’ Protests begin in more benign locations like flyover, BFE, X-GSVille, etc. Gov. Scott will continue to ruin Florida. I will not buy a house.”
And this, “I predict a decent year for the economy, despite a continued slow decline of housing prices. Obama gets re-elected as a result. The sub-3.0% GDP growth, falling income relative to inflation (except for the rich and retired public employees), and small employment gains will become par for the course, but people will get used to it.”
“I don’t think the long term problems have been solved. These include an excess of consumption in the U.S., an increasingly unequal distribution of income here, and the reliance of producers across the world on U.S. workers who no longer have money or the ability to borrow. An aging population that didn’t save. And a poorer younger population which cannot pay as much for houses and other assets as those coming before. These problems will take decades to overcome as the country gradually de-leverages, asset prices fall, and Generation Greed passes on.”
“In the short run, however, the housing bubble and bust has done most of the economic damage it is going to do. Construction can only go up from rock bottom levels, generally in smaller units in locations that provide short commutes, and no one is borrowing against homes to finance short term consumption anymore.”
“The heart attack is over, and unless the Republicans in Congress or the Europeans succeed in taking the economy, it won’t recur. The cancer continues.”
One had this, “There is still so much money sloshing around this state. Every time I turn around there is some announcement that Lockheed has won another contract or such and so has won a grant. These grant announcements seem to be made quite regularly w/higher education and medical being (I think) the usual beneficiaries. I have to say I am really surprised because I thought the stimulus money was supposed to be drying up right about now. I’d really like to follow the money back to it’s sources and also do a little digging as to who specifically is benefiting. Somehow I don’t expect to find out it’s the average Joe on the street.”
“The Lockheed contracts have been particularly interesting. I don’t want those people to lose jobs, believe me. It’s just there’s a sense of disconnect when you hear the government is broke and then every few months you hear of a new contract being awarded.”
“Aren’t the federal and state governments supposed to be out of money? Where is all this funding coming from?”
A reply, “It’s only broke when it comes to our benefits. Remember there is an infinite supply of currency available to them. The variable being confidence in the Fiat.”
Another, “The economy will continue to divide Americans into two classes. 1) Americans with money and or good jobs. 2) Americans with crummy jobs or no jobs and no future.”
“Home prices will go up in areas aligning with No1 above and continue down in the No 2 areas. Wild card: government debt how long can it continue without problems?”
And finally, “I predict a ten to twenty percent gain on the S&P 500 index in 2012 and Obama will be re-elected. I predict a surprising boost in tax revenues at federal and local levels for the 2011 tax year.”
From a year ago. “Here are my predictions for 2011. It will be a year of continued financial turmoil, combined with more of the same extend and pretend issues. The big predictable financial crisis will be Spain, and the EU will decide to print their way out of this ever spreading mess just like the US. Smaller banks will continue to fail at the same rate. We will see QE3 - 4, gas prices will continue to climb as will commodities, metals and silver. The disparity between wealth and poverty will not diminish. Home prices where I am, coastal socal, will continue to drop at a rate too slow for my liking. I expect a 5-10% drop at most in 2011. Unless something crazy happens, there will be no major collapse, no additional US wars, and our government will continue to kick the can down the road. Amazingly, it will be more of the same.”
Another, “I predict that Estonia will rue their adoption of the Euro, scheduled for midnight tonight. I predict that China will demand an increase in US bond interest rates - or they won’t buy any more.”
“The conflagration in the PIIGS is the new ‘Reichstag fire’, and will be used by Germany to extort concessions in the EU. There will be a constant threat to withdraw from the Euro, but these will remain a threat for about 2 years. I predict Ein Neues Deutschmark to come in 2013. I predict that Her Majesty’s Government will tell the EU to ‘get stuffed’ when the EU presses the demands for the UK to adopt the Euro.”
“I predict that housing prices will trend down softly in most markets.”
And another, “Gold will continue to increase to around $2,000 / oz and we will see Silver over $45. We have just completed the first dead cat bounce on the real estate side, and prices will continue to fall at an accelerating rate. Around the middle of the year, alarmed by the new wave of walk aways, the Federal Govt will again attempt to intervene, putting a floor on prices for the balance of the year. It is highly likely FB’s will be invited to ‘rent’ rather than foreclose.”
“Unemployment will continue to increase and wages will generally fall. The business climate will continue to get progressively worse, and major credit card issuers will start to exit the credit card market, causing further erosion in Americans buying power. We will see record personal and business bankruptcy filings, possibly on the order of 3.5 million or there abouts.”
“Apple will hit a snag and has most likely already peaked. Energy costs will continue to skyrocket as will medical insurance costs, probably 20% each. Oh yeah, almost forgot…Cheer up it could possibly be worse and Happy new year all!!!”
One from two years ago, “A sure lesson of 2009 is that crazy hangs on longer than anyone expects.”
“I see an increasing number of people thinking that the worst is probably well behind us and we should start getting back up to normal just any time now. Most of my friends are much worse prepared for another shock than they were in the fall of ‘08, many of them say they could not survive another round of trouble. More than a few of these poster children have loaded up on debt in ‘09 to ‘maintain’, wasting a valuable stretch of time to better prepare.”
“My take is that Normal, in the sense of something sustainable, is still a long way down there. We are headed there in fits and spurts, dragging and clawing all the way. Likely we will get in a wave at Normal without the train stopping at the station.”
“The lesson for me is not to take the day as an end game, but to live, work, play and love hard all along the way. In the last year of this decade I see good things for Blue Skye:
Overhauled engines in my boat.
Ten pounds lost before I lie naked on the beach at Oka again with my beautiful Canadian Redhead.
A superb vintage of applejack.
New and interesting projects at work.
Living below my means whatever comes.
Freedom from debt.
Happy New Year all!”