nmap
12-28-2009, 18:33
What's 2010 going to be like? No one really knows, of course, but making predictions is fun - and looking at what happened (and what didn't happen) after the year has passed is even better. So in that spirit, I have polished up the crystal ball, and as I gaze into the depths, I see...
Oil prices in a trading range, not going up or down much from here. New Iraqi supplies coming online, along with persistent slack demand will prevent any big move up.
Gold and silver will also drift through the year, although they may end 2010 on a strong note. This will result from a relatively strong dollar, which will not collapse but rather will hold its value. In turn, the strength of the dollar will result from the decline of the Euro and concerns about the stability of Europe and the rest of the world. U.S. economic troubles notwithstanding, the dollar will be seen as a safe-haven during 2010.
The U.S. stock market will see a decline, probably in the second quarter of 2010 - in the period between April and June. I would guess it would take us to about 8900 on the Dow. It will then recover, leading to claims that a new bull market has started. Don't believe it - but that gets into 2011.
Interest rates will go higher, with both the 10 and 30 year treasury bonds reaching much higher yields. Look for 5.5% on 30 year bonds, and 4.75% on 10 year bonds.
Unemployment will not go down, although we will see stabilization - keep an eye on U6, which I expect to stay above 15%.
Loans will continue to be difficult for both individuals and small businesses. Residential real estate will not improve. Commercial real estate will decline.
Overall business activity will not improve. Debt will become ever-more onerous, and those with liquid cash will have many opportunities.
Congress will become even less trusted and less popular. Political discussions will become more rancorous.
Mexico will face further instability. Border issues will capture the headlines. Some of the instability will cross the border, leading to calls for control of the border. Those calls will be studied but otherwise ignored.
Crime will increase. Government at every level will face financial pressures, and police departments will experience cuts.
Expect several states to call for federal bailouts.
Summarizing, 2010 will be a challenging year for most. Those with liquid assets and secure incomes will enjoy a variety of opportunities. Those burdened with debt, and those in less secure jobs will find less to enjoy.
And now that I've stuck my neck out...your turn!
Oil prices in a trading range, not going up or down much from here. New Iraqi supplies coming online, along with persistent slack demand will prevent any big move up.
Gold and silver will also drift through the year, although they may end 2010 on a strong note. This will result from a relatively strong dollar, which will not collapse but rather will hold its value. In turn, the strength of the dollar will result from the decline of the Euro and concerns about the stability of Europe and the rest of the world. U.S. economic troubles notwithstanding, the dollar will be seen as a safe-haven during 2010.
The U.S. stock market will see a decline, probably in the second quarter of 2010 - in the period between April and June. I would guess it would take us to about 8900 on the Dow. It will then recover, leading to claims that a new bull market has started. Don't believe it - but that gets into 2011.
Interest rates will go higher, with both the 10 and 30 year treasury bonds reaching much higher yields. Look for 5.5% on 30 year bonds, and 4.75% on 10 year bonds.
Unemployment will not go down, although we will see stabilization - keep an eye on U6, which I expect to stay above 15%.
Loans will continue to be difficult for both individuals and small businesses. Residential real estate will not improve. Commercial real estate will decline.
Overall business activity will not improve. Debt will become ever-more onerous, and those with liquid cash will have many opportunities.
Congress will become even less trusted and less popular. Political discussions will become more rancorous.
Mexico will face further instability. Border issues will capture the headlines. Some of the instability will cross the border, leading to calls for control of the border. Those calls will be studied but otherwise ignored.
Crime will increase. Government at every level will face financial pressures, and police departments will experience cuts.
Expect several states to call for federal bailouts.
Summarizing, 2010 will be a challenging year for most. Those with liquid assets and secure incomes will enjoy a variety of opportunities. Those burdened with debt, and those in less secure jobs will find less to enjoy.
And now that I've stuck my neck out...your turn!