It’s that time of year, which means Jill and Dan crack open a bottle of wine, look back on our outlandish predictions for 2009, and have a good laugh. We’re not too proud to tell you when we’re wrong. But were we right on the crucial stuff? You decide. Let’s recap…
1. By the end of 2009, inflation will be a big problem.
WRONG. Inflation is rearing it’s head but it’s not a “big problem” yet.
2. The U.S. government will behave like deficits don’t matter and spend like an Atlanta Housewife who just caught her husband cheating.
RIGHT. 100% right, so correct it offends EVEN US.
3. Gold, silver, and agriculture commodities will be the best performing asset classes, not guaranteed stellar returns, but will perform better than others. Got corn?
RIGHT. Gold and silver rocked our world. Gold is up 30%, silver is up 40% year over year. Corn is flat for the year. Watch out, agriculture is next.
4. Commercial real estate will implode and create a derivatives storm that makes sub-prime debacle look like a gentle sprinkle.
RIGHT. Comm real estate is imploding, but the government’s stop-gaps have held back the flood that will be seen in the next quarter or two.
5. The greatest bubble of all time, US treasury bonds, will begin to deflate, wreaking havoc globally. Grannies, sell your bonds and buy gold.
RIGHT. Jill’s message to Grannies was ridiculously right. Bonds were at 140, now they are at 115, falling 20%, (btw they have a long way to go). Grannies that sold their bonds and bought gold they would be up 30% and avoided losing 20%. Gold-loving Grannies would be up 60% over their other, less savvy Granny friends clutching their bonds for dear life.
6. Real unemployment (not government reported) will hit levels not seen since the Great Depression. Repeat the daily mantra “I love my job, I am grateful for my job…”
RIGHT. Night quite great depression levels yet, but on real terms unemployment is at 22% and will be 35% before the bottom is in. Check out shadowstats.com for more.
7. The U.S. dollar will hold its strength through the first quarter, but by year’s end will crumble and lose its status as the world’s reserve currency.
RIGHT ON!!! Is Dan a SAGE? Even a dead cat thrown from a plane at 10,000 feet will bounce a couple feet. Expect the next leg down to be brutal. The Grannie with gold will (again) be is pristine shape.
8. The love affair with President Obama will be over by summer as the reality sets in that the government cannot solve our financial problems. Not his fault. At least he still looks good in a bathing suit.
RIGHT. The most unpopular president one year after being elected. But he still looks good in a bathing suit, and his wife dresses well.
9. End the age of “American Consumerism”. Begin the age of “American Frugality and Savings”.
WRONG. The American frog continues to simmer slowly, although frugality is now chic.
10. The emerging markets will begin to re-emerge as they end their addiction to the U.S. Consumer.
RIGHT. Brazil, Russia, China…you name it - they are on fire and have outperformed the U.S. China is becoming less U.S.-centric, as long as they can kick the dollar we still love them.
11. Two large U.S. Cities will declare bankruptcy.
WRONG. No one has officially declared it, but many U.S. cities are out of money. Watch for the bailouts in 2010.
12. The federal government will be forced to bailout California.
WASH. California, as well as other states are being bailed out by the federal government in unemployment, but the dominoes are beginning to fall. California is not going down without a fight, they are paying their bills in I.O.U’s.
13. People will start growing their own food and replacing their lawns with veggie gardens.
RIGHT. Not only are they growing their own food, but the chicken coop industry is on fire. Cock-a-dooldle-do y’all.
14. Entertainment, and the business of being a celebrity will be going strong.
RIGHT. Hello, Avatar, New Moon, and Jersey Shore.
15. Therapists will be replaced by neighbors and friends.
WRONG, we’re not there yet. Insurance is still paying.
16. Couples will increasingly avoid divorce to save money.
RIGHT, actually we are wrong. They are avoiding divorce because they can’t afford it with homes under water and negative assets.
17. A re-emergence of cheap but brainy entertainment, like playing chess and playing instruments with real people.
WRONG. We’re not there yet. But we can dream, can’t we?
18. People will view visiting the doctor as an unnecessary expense and take steps to control their own health.
WRONG. For the same reasons as #15. We don’t know, actually. We live near Seattle and everyone’s head is still up Microsoft’s ass. Doctors are still thriving here. But we wonder what 2010 will look like.
19. Plastic Surgeons will be offering services discounted 80%, which will attract patients from overseas.
WASH. Prices on Botox, Juvederm and other injectables have indeed gone down to attract more patients. However, the big ticket surgeries are still expensive due to hospital fees, etc. When the dollar really tanks, more than the 12-17% decline we saw this year, we’ll see this happen.
20. Most services (like manicures, haircuts, lessons, and education) will get cheaper, in relation to everything else.
WASH. Some of these services are getting cheaper, but inflation this year has caused some to raise their prices.
