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AHA from Interesting Times Magazine asked for some 2010 predictions for the next issue.
This is what I sent him:
2010 doesn’t look too good.
More unemployment in 1st world countries, more social problems and an increase in crime.
People that used to live in places where they didn’t even lock the doors will now suffer home invasions and either adapt to the new reality or become victims.
Friends and relatives that had high standards of living are now poor.
More people on the streets, more families dumpster diving.
The wave of people in Europe that lost their jobs in 2009 are now running out of “el paro”, the unemployment bill the government gives them, this will probably cause protests and maybe even some social unrest.
More people will return to their countries of origin as the 1 world countries they went to now lack job opportunities.
In USA the government will desperately go out hunting for tax money. 2010 will likely be remembered as a year of increased taxes as well as new ones. Fines and such, they will all go up in price to round up money to pay for the bailout and free healthcare.
Government control and invasion of privacy will become a more serious problem as the authorities try to control every aspect of people’s lives, and their spendings.
It’s not all bad. It will also be the time for business opportunities. Those that understand the new needs and new social sectors may find ways of making good money.
Even more people will be moving back to their parents and families living together chipping in all together to make a living.
The grandparents are now sought after for their nanny capabilities, saving money for the family doing such job.
There will be a reduction in the leisure market. People will be buying some luxury items but even the higher classes will become a bit more careful about spending in general.
Throwing money ridiculously wont be fashionable any more, and different groups and non profit organizations will be formed, not to save the whales or rainforest, but to feed the new generation of poor children.
There’s going to be an increase of small, home based business and companies, started by ex-unemployed.
2010 will still be a complicated year for most people, mostly reagrding unemployment, poverty, inflation and a new problem: higher rates of violent crime.
By the time we start 2011 we will have both a more solid economy and society. By 2011, the main problem wont be the economy, but governments that now have too much power, power that was granted to them to get the people out of the crisis.
Fernando “FerFAL” Aguirre
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Sunday, December 27, 2009
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7 comments:
FerFAL, you might want to add an "American Revolution" to your predictions. Americans are beyond angry, they are livid. We are not a people who take things laying down, or do well with totalitarian rule. The core population who have been here for generations (as well as many immigrants from former Soviet, and other communist/socialist nations) are waking to the tyranny being wrought by the White House and Congress, and the anger builds by the day. Even through the Christmas season, a time when most folks traditionally tune out the goings on around them to concentrate on family and friends, the discontent has continued to build, mostly due to the "health care" Obamination that's being forced down our throats by our so-called "representatives". The majority of Americans (66% according to one poll) are vehemently against this law, and the bureaurocracy sure to accompany it, yet the politicians turn a blind eye to the growing fury over their refusal to carry out their constituents' wishes. Tension is mounting, and it can be felt in the air to those tuned to such things. Come January 2, it's a whole new ball game here in the US of A. Things could get mighty interesting, to say the least...
You are very mistaken if you are referring to the US economy "improving" in 2011. I recently read your book and found many good suggestions; however I had already taken all of those precautions and more. 99% of people here in the US are TOTALLY unprepared for what is coming in the next couple of years. I am a CPA/ Economist by Profession and I wonder as to what your reasoning is for your projection of an "improving" economy in 2011.
Ferfal,
You mention a rise in violent crime and home invasion. This will make a lot of people angry and scared. So, what do you do? You cannot lock everyone up, nor can you always sleep with one eye open. The most sensible, also most difficult, solution is to grow the economy so people will have an income to live on. The sooner this happens, the safer we all will be.
The only ones that know what the economy is going to do next year are the handful of those that control it.And their not going to tell you.
As for Economic predictions, historically you get better odds in Vegas.Personally I think next year will be flat.Sart improving in2011 but no real recovery starting until after presidential elections in 2012 when Obama is shown the door.But that predictin plus $3.55 will get you a cup of coffee at Starbucks.
Even though the dollar has had a reprieve and gold fell, the long term trend has it knocking on the door of 72 on the USDI. When it breaks 72, there may be support at 60, but temporary, and it heads for forty. I hope they officially devalue the dollar as rumored by a few to happen in about a 12 to 18 months. At least it would be orderly and not a 'falling knife', as they say in the market, 'that know one wants to catch'. If that, we become a 'super sized' Zimbabwe. Monetization has begun in earnest and that is akin to flushing a toilet, it ain't gonna stop.
Looking under the blanket, things are far worse than most can imagine. I was beginning to believe that a slow stair step decline was likely. Taking a recent and hard look has convinced me that a faster collapse is in the making. In 6 to 8 months we will see the beginnings of high and then hyper inflation that began in earnest last month with serious monetization and reflected in November's PPI increase of 1.8%. That number is the cost of wholesale items, mostly imports. The PPI (Producer Price Index) price increases and decreases, typically take 6 to 12 months to be realized. Assuming the rate is constant, that 1.8% and would be a 21.6% increase in the cost of wholesale goods. Deflation will also gain speed in rough proportion. Assets, things we own can, historically drop in value by 60 to 95%, i.e. 1870's, 1930's.
Bailout Bernanke is just getting started. IMHO, they fear an implosion of the 1+ quadrillion derivatives market most, and will needed to hyper inflate to the moon as the economy will no longer support the books of financial institutions, pension funds, and corporations, and even states that are all intertwined and represent significant counter party risk. At least 40 states are or will be bankrupt. In contrast, during the Great Depression, only one state, Alabama, became insolvent. There are over 2,000 banks in serious trouble, the FDIC is broke, ARM's are exploding, the commercial real estate collapsing (bigger than residential), the new Healthcare system will be funded, unemployment benefits extended, the war is escalating,...and I'm just rattling stuff off, there's is more. The weight of what is now occurring is heavier than the weight that brought the economy to this point.
If one cannot believe all this is actually happening, remember Eastwood's over used words, "...Do you feel lucky punk?" Lying to yourself about the potential of this situation is the worst thing you can do. At the least, I'd error on the side of caution.
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More people will return to their countries of origin as the 1 world countries they went to now lack job opportunities.
This is already beginning to happen here with many ex-pats fleeing the US and heading back "home" - even people who have lived here for most of their lives.
I don't think any of your predictions are very far-fetched. Thank you for offering them, and for continuing to offer your advice based on your experiences with a collapsed society.
Sounds and looks like North America and many other countries with traditional high living standards will take a beating, while the 3rd world will see an uplift - make us all equal. Right, that'll work.
I don't know if America will revolt, but I already see quite a bit of resentment with the Fat Cats getting a bailout on the taxpayer dime, without any help for the people who really need it.
There will be a reckoning of some sort, and I see a government crackdown coming - big time. Mainly on the ways people get their income, I see a lot of government sticking their noses in where they don't belong.
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