I predict 2009 will be the year of the dead-cat bounce. The California Median Home price will actually go up this year (or at least for the first part of the year) due to more higher-priced homes selling (although at lower prices than comparable homes sold last year). This will prompt the MSM to call a housing bottom leading to a rise in the stock market and additional RE buyers as those who have been waiting on the sidelines will be afraid of missing the bottom and jump in.
I think the DJIA will actually finish up this year. My forecast ~ 10K. I will continue to dollar-cost average into stock market indices as I have for the last several years. I see no reason to stop now (Yes, I’m an idiot).
As for housing, I think the high end will start to go down in earnest this year, but the lower end areas may have already hit bottom.
There was an article on MSN.com the other day about the U.S. debt bomb. Supposedly, 40% of the U.S.’s national debt will be coming due this year. It will be interesting to see if we can roll all this debt over as well as adding another $2 trillion (or whatever the new administration is planning) on top of that. If we can roll that 40% over + the $2T into long-term debt at low rates, we might come out of this thing OK.
I’m confused how the Fed can print money in order to buy $500 billion in MBS/CDO/etc without a spike in gold or treasury rates or a decrease in the value of the dollar. The Fed just announced that they are starting their purchases today, but gold is down quite a bit, the dollar is up pretty huge, and treasuries appear to be holding steady. It makes me think that the demand for U.S. debt is just insatiable. However, in spite of all the current evidence to the contrary, I think interest rates will go up this year.
I forgot what all we were supposed to predict, but I think oil will be up this year and gold will hold steady (within + or – 10% of where it is now). I also predict that partypup will make the periodic “end-of-the-world-as-we-know-it post” from his bunker in Montana (or wherever the hell he is hiding).
Oh, and after Obama rescues the U.S. from certain doom and returns this country to prosperity, AN and FLU will switch their voter registration to Democrat and buy Hillary Clinton nutcracker dolls and Obama “Yes We Can” bumper stickers.
