An Early Round of 2009 Predictions

Before the predictions a brief word about the election. I believe this country has a way of picking the leader it needs at times of major crisis. From Lincoln at a time of grave division to Roosevelt at a time of ultimate peril. I believe while it is too soon to compare this man to those historical figures, the selection of Obama is game changing and this country will be well served by his vision. Beyond the rational cause for celebration I find his selection to be enormously good for the countries morale.  This is good because if my predictions are correct we will need that boost and more to get through what we are facing.

And here are my 2009 predictions in no specific order:

1. The economic trouble we are facing will deepen in ways we don't yet understand. I suspect the dollar is going to collapse. The impact of that collapse will touch a broad swath of both the middle and upper classes.
2. Obama will have enourmous leeway to push major initiatives through and he will succeed in getting many of them implemented. My guess is that he will get major health care reform, a giant public works/infrastructure stimulus package and drastic environmental reform.
3. The government will likely have to step in and suspend all home foreclosures for 12-24 months, freeze repayment of student loans and one or two other unheard of federal controls to keep the downturn from accelerating.
4. The U.S. will be forced to speed up withdrawal from Iraq to bolster troops in Afghanistan.
5. The DOW will close out 2009 below 7,000. If I had to guess I would call 6,800 a distinct possibility.
   

It Gets Worse Before It Gets Better

I have been watching the US economy unravel before my eyes for the past few weeks and the question that keeps coming up is:

What is the worst that can happen?

Sadly nobody knows. Those in power were not on the scene during the Great Depression and even if they were a new calamity seldom behaves like the last one. What does an economic crash look like when the economy is no longer primarily agricultural? What does a fully networked populace do when companies start falling like dominoes? In the 1920's one could raise chickens and grow food to survive the hard times but a suburban and urban America several generations removed from that kind of self-reliance will have an entirely different response. What might that response look like? I hope we never have to find out.

Blended Blur Endorses Obama