Home prices will continue to fall nationwide. I’ll put San Diego at overall -10% from the start of the year. The NRA will call bottoms almost monthly, especially when prices flatline (or slightly uptick) during the Spring buying season.
Q1 will see a barely positive, nearly flat growth of the economy (think +0.1% or so). Q2 will go negative, and by Q3 we’ll officially be in recession. By the end of 2008 the recession will be almost over.
Despite rampant inflation, the nominal value of the dollar vs. other currencies will stabilize as Europeans continue flocking to the US for tourism and buying up cheap goods.
Obama will win the Democratic nomination and defeat whoever emerges from the muddled Republican group, as none of them can carry both fiscal and social conservatives. The Democrats will also pick up a couple seats in the Senate, and make modest gains in the house.
The new administration will have their work cut out for them; an expensive war in Iraq that continues draining our nation’s coffers, Stagflation, and the ticking time bomb that is Baby Boomers retiring and straining Social Security. Still, 2009 will likely bring a return to Bill Clinton-style economics, gradually leading to a return to prosperity for the Middle Class, and general grumbling by the Very Rich.
