2010: A Foreboding Course?

It's Not the Worst of Times - Yet!

2010 is upon us and we all hope that it will be a good year. The question remains will it? Realistically, hope is a wish and a wish is a desire. But have hoping and wishing ever accomplished anything?

So it will go into a new year. Hoping and wishing are of a separate reality as past actions and trends will guide the course of the new year.

We will soon learn the 2009 Christmas retail season was a bust. Watch how they present and spin the numbers. As money acquires less value consumers will spend more for less. Watch for empty store fronts at your local malls. This will further deplete the commercial real estate market.

The economy will continue to sputter throughout 2010. It will be worse at the end than at the beginning. Both government and news media declare the worst is over. However, this is based solely on the Equity Markets. These markets were overpriced back in 2007 flooded with unstable paper. For continued growth the market would have to return and surpass that of July 2007. Only then can those that lost money regain it and make a profit.

Unemployment will continue to climb slowly. The government will continue to report numbers in as positive light as possible. Omitting those who have dropped off unemployment, those who have given up, and those who are working part time and are in need of full time employment. As government prepares for the census unemployment figures may drop as government hires approximately 800,000 workers. This will be temporary as these employees will eventually be let go. Health care legislation could also be a factor as business models will need to change to adapt.

Banks will continue to fail. To date 215 banks have failed since early 2007. Over 600 banks are teetering on failure according to what's in the FDIC database. It will be a busy year. The Federal Reserve will inject millions into the banking system to prevent further deterioration. The FDIC is broke.

The FHA is following Freddie Mac and Fannie Mae and has been in trouble for some time. Congress will allocate billions of dollars to sure up the FHA in an attempt to prevent a full scale bail out. At the same time the government will use the FHA model to control more of the mortgage market. By the end of 2010 government mortgages could be as high as 80%.

Freddie Mac and Fannie Mae will be forced to convert their preferred stock to common stock to raise capital. They are losing gobs of money and will top $400 billion. Freddie Mac and Fannie Mae could be merged to conceal and prevent further losses.

Taxes will rise at all levels of government. Government is feeling the pinch from the recession as revenues decline. Politicians will be creative at the federal level. Local governments will step up enforcement of laws that generate revenue. New laws will be created to generate more revenue and fines will increase on existing laws.

The dollar will continue to fail. Inflation will increase forcing consumers to pay more for everything. The government will continue to downplay inflation as they don’t include food and energy increases in their statistics. The Federal Reserve Bank will be active in Foreign Exchange selling and buying dollars in an effort to stabilize the dollar. The Fed will work against itself by printing more money to buy those dollars. Gold will break the $1,400 barrier.

Bailouts and handouts will continue and increase. As people continue to lose their jobs and unable to find employment, more will become dependent on government programs. More bailouts will be directed to states and municipalities. Big business handouts will continue.

Business will sputter along but small business will suffer most. Investment capital will be hard to find and harder to secure. This could cause spot shortages of product due to lack of investment in delivery infrastructure. Businesses will be unsure about the future and will further downsize to reduce cost. Health Care and looming Cap and Trade will have a negative impact. More jobs will be outsourced to elude taxation and regulation.

Real Estate will fall another 20% by the end of the year. Good buyers are fearful of taking on a big mortgages while sellers are reluctant to accept reduced offers. Many more homes will be empty due to job loss. Mortgages at best will be difficult to acquire except through the government FHA program. FHA could drive many sellers to take heavy losses through overbearing regulation.

Crime and civil unrest will rise as people become desperate. Inner city drug dealings and murder will increase. Law enforcement will struggle to keep up due lack of funds. Lack of funding will be due to corrupt politicians catering to unions, pay to play schemes, handouts, and bad management of taxpayer capital. The chickens are coming home to roost.

By the end of 2010 it will be clear we are heading into a depression.

There will be one or more terrorist attacks on American soil. Iraq, Afghanistan, and Pakistan will continue to deplete resources. No one wants to take on the corruption of these governments. The Obama Administration has changed the rules of the game. If a terrorist gets caught they understand they will get the same treatment as an American Citizen. This is a very good trade off and well worth it for those who want to kill us. Terrorist have no reason to fear punishment.

Cap and Trade will either die or change form as more and more people are starting to think this is more about politics and money and less of science. Health care legislation has helped erode Cap and Trade. In the year ahead more scientists will step forward taking a stand against man made climate change. People will wonder where the warmer climate is after several colder winters.

Illegal Immigration will become the next hot topic as law makers will go behind closed doors (as with Health Care) to write an amnesty bill. In hard economic times the American Public will stand against it. Congress will continue to ignore the people and this will add to civil unrest. There will be a shift to buy American products and to protect American business and trade.

More people will become disgruntled and distrusting of their government, policies, and political parties. More people will leave their respective parties to become independents. This could lead to a newly formed party giving both Democrats and Republicans a run for their money.

The Media will continue to paint rosy picture but people will begin see the deterioration in their own neighborhoods. As the distrust in the media increases this will give way to alternative media start ups who will successfully compete by presenting more relevant information with different points of view over the air waves and cable. This could involve bringing the World Wide Web to TV and could put the nail in the coffin of the media as we know it today.

For the sake of all of us, I hope I am wrong on all counts!

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Comments 8 comments

stevenschenck profile image

stevenschenck 6 years ago from Sacramento California

Geee - I was so happy in my ignorance. Much of what you said is very true, but in all of these failed and failing systems Americans, being innovative, strong, and having international power will find ways to adapt, accommodate, overcome and survive.

I talked to a trucker today, he was a Real Estate broker last year, that is America. Adapt, survive, overcome. Two years ago I worked for a Governor, now I write books and websites, only in America can we realize our potential.

Sadly, as long as our large corporations own our government officials these failures of the system will make some of them very rich and many of us very poor.

Happy New Year

We will have to revisit your great post on 12/31.

breakfastpop profile image

breakfastpop 6 years ago

Great sad and thoughtful hub. I, too, hope you are wrong, but frankly it's hard to argue with much of what you say. Let's not give up hope, okay?

Pamela99 profile image

Pamela99 6 years ago from United States

I feel like going and putting my head under my pillow. I am concerned because I think much of what you say will probably happen, but I sure hope it won't be to that degree.

ehern33 profile image

ehern33 6 years ago

I have to agree with you on this. I don't see a rosy picture this new year but I do still hold hope. The spin will continue to be evident. Good observations into what we may expect.

eovery profile image

eovery 6 years ago from MIddle of the Boondocks of Iowa

Sad to say, I think you are probably right.

This saddens me, but it does help me build a strategy on what I am going to do to help myself out.

Keep on hubbing!

joer4x4 profile image

joer4x4 6 years ago from Philadelphia, PA Author

Thanks for the comments. While the big picture looks dim there will be some good things.

As per Steven, American creativity should not be under estimated. I think anyone starting a business offering products for better living and health will do well. The same for entertainment.

I also updated the post as I will think immigration will be hot this year.

A great New Year to all of you!

cheaptrick profile image

cheaptrick 6 years ago from the bridge of sighs

I live in a college town and have faith in our youth,they will Cary the load just as we did in the 60s.

In our town the young people are out raged at "the Obama deception"as they say.Many worked hard to get him elected and feel betrayed.

Thank God for our young people and the Militias,they may be our salvation.


James A Watkins profile image

James A Watkins 6 years ago from Chicago

I am starting to think you have a crystal ball, my friend. :D

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