Here are CD's predictions:
1) I say it is 3:1 that we fall into a depression - a deep depression. I use the number 3:1 because that is the number of my clients that are laying people off in droves.
2) I say the unemployment runs officially at 15%, but realistically at 25% or more. I would not consider 30%+ unrealistic. The reason I am using those numbers is that is the percentage my clients are laying off of their work force (the low end). In addition, given that I work in an industry that is supposed to be "recession proof", I anticipate that the rest of the working world will be worse than the 15% I am seeing. Also, there are not the number of low paying manufacturing jobs here that once were. Those reside in China and India. I should also mentio nthat every client I am working with, without exception, is using the "cheap labor" in Asia now more than ever to remain competitive.
3) I say that it does not get any better for many, many years. I say that it is worse than it was for the first Great Depression - a lot worse. My reason for this is that our country is in a lot worse position now than it was 70 years ago. We have much more debt and few of us know how to keep ourselves fed or "just get by". I also think it will be much worse because of how global the economy is, our "free trade" practices, the mass exodus of any type of manufacturing jobs, and the incredible debt our country has incurred (even in good times).
4) I say that violent crimes will skyrocket beyond belief and at a level our country has never known. I say that again becuase few people know how to care for themselves and our cities are larger and more crowded than they were 70 years ago. In times like these, I think percentages of people starving or unemployed hold less value than the actual number. Think about that the next time you look at unemployment and also ask yourself if that is truly all of the people unemployed? Or, is it simply those that are claiming unemployment? Does it count those that have fallen off the timeline for unemployment?
5) I say that housing will become the bad dream and ghost image of better times. The massive numbers of banks that will own houses will causes such a flood that there will be empty houses sitting everywhere. It will look like Houston in the 80's (which is what I base this information on). In Dallas, we are now entering a time where houses are springing up all over the place for sale. People are upside down in them. THey have lost their jobs and were not able to find another one. THeir unemployment and savings have run out. They will not be able to sell their house quick enough. The banks will take them back. Now when you say to yourselves that this scenario has already been happening everywhere, let me tell you one small caveat: Dallas never appreciated like the rest of the country (hardly at all) and never really over built. I find it a better pulse of the economy than the other cities I work with.
6) I say that the depression
process begins in January. That process will involve more layoffs and more foreclosures and the start of climbing unemployment. I use January for many reasons. First, it will be the end of the holiday season and the abysmal holiday sales number will give people a great indicator of how bad things really are. Second, the Obama Euphoria will have run out and people will suddenly begin to realize that we simply cannot fix the problems here (or elsewhere) as we cannot print money to make it better without actually making it worse, and third is that January is when the stall on foreclusres will have ended and when unemployment for many of these people will have come to an end. I also feel that the effects of Wall Street takes many months to trickle down to Main Street.
That is my version of what is going to happen. I base it upon my career and what I deal with everyday. I do not think it has even begun to get bad. But as people's credit cards run out and what little saving they had ends, it will start to collapse. That has not started yet. I think too many people look at a great day on Wall Street as an indicator that we have made it through - or as an indicator that things are bad. I think Wall Street is a very poor indicator of this as some of the biggest gains and losses of the Dow were during the depression.
I am certainly not saying we will go into a depression. I have no crystal ball. I am saying that there is a very good chance that it could happen. I am not basing this off of economists - I am basing it off of what I see on the ground, right now. And if it does happen, I have listed just some of the things you will see come out of it.
Now, my final prediction:
Here is how we will come out of the GDII: War. I think we will get involved in what may start off as a small conflict and expand into another very large global conflict. My reason for thinking this is that when times get tough (and remember, it is not just tough for us but for the whole world) you, as a country and society, treasure things tighter and tighter. You cannot afford anything else that might disrupt what little you have left. As such, you cannot tolerate others gaining strategic advantages over you. And could it also be argued that war is good for the economy? Who knows.
Anyways, who knows. I am probably all wrong and come January, we will have our best year ever and unemployment at 1%, and the lowest forclosures ever, etc. I am no economist. You guys know a lot better than I do. But I will just say that right now, at this second, things are quite bad for many people. When I say bad I mean their future is pretty bleak. That is what I deal with day in and day out and I certainly do not see anything that will make it any better - only worse.
- CD
PS For those interested, here was my version of this thread when we started this whole disccusion. But past performance is no guarantee of future!!
http://www.sailnet.com/forums/off-to...ere-yet-4.html
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