OK, I’ve always kept my eye on these predictions and feel like I could do a better job than most, so I’ll give it a try. It will be interesting to look at in a year…
Housing :
San Diego: 25-30% drop from current overall median of $305,000 to $213,000 to $228,000. Reasons listed below, same as nationwide.
Nation wide: 20-22% drop nationwide in the Case-Shiller 20-city index. We just saw 18% in the last 12 months, and I don’t see anything happening to improve the situation, so it makes sense that as conditions worsen, there will be a lot of panic selling, explaining the increase in accelerating losses.
Jobs :
San Diego: Current “Official” Unemployment is currently 6.9%. Same official number come December 2009 – 10%
Nation Wide: 10% +
Oil : That’s tough, not something I watch too closely. My guess is less than $40 a barrel.
West coast: Gas $2.50 Gallon
East Coast: Gas $2.50 Gallon
Gold : Will fluctuate between $600 and $1200 an ounce, ending in December 2009 around $750.
Strength of $ towards:
Euro: Now trading 1 Euro to $1.39
By years end, with a lot of fluctuations, will end around $1.78, but under $2.00.
Yen: Now trading at 1 Yen to $.0109, will finish at $.0075
One other economic indicator:
Dow, December 31, 2009: 5,750
Final outcome to all :2009 will bring the realization that 2008 was only the beginning of one of the largest economic downturns in history, and perhaps the first truly global synchronous one. The word depression will be thrown about, although people will be careful to not use the term too loosely. News organizations, especially financial ones, will be of a decidedly more somber tone. Politicians also will be more serious about their jobs, as will we. Fear does that; like a splash of cold water…
But the world will not come crashing down, there won’t be anarchy in the streets and daily life will go on as always.
We may be better off as a country and as a people for what we will experience. 20 years of mindless consumption will be looked back on with disdainful eyes, and words like “thrift”, “frugal” and “simple” will be in vogue. Perhaps we will call it the “new austerity”.
