The year 2010 will be as challenging, if not more so, than the year 2009. This writer sees little improvement, if at all, in the lives of most American citizens. The slow deterioration of the United States will continue on unabated, and very well could worsen at a faster pace than anticipated if certain circumstances eventuate. With that being said, here are some specifics:
1. Unemployment will continue to be the most immediate serious problems facing American citizens. The U-3 unemployment rate will see little decrease in 2010, and is likely to inch upward. The forecast here is for the rate to wobble between 9.7 and 11.2 %. The more accurate and realistic U-6 unemployment rate will continue to be grim and will worsen, as more citizens are resigned to just part-time work or are underemployed; and the numbers of those who have just given up and dropped out to live off of relatives and friends will increase. The U-6 rate will be between 17.0 and 21.0 % during 2010, and the seriousness of this crisis is likely to be statistically understated.
2. With demand remaining soft at best, and likely declining, there will be little if any inflation in 2010 for prices for consumer goods, and raw materials prices should remain static as well. Possible exceptions exist for food prices, which are contingent upon weather and other factors; but do not expect any notable upticks. Sales and markdowns will continue to increase with retailers, and some great deals will be had by those who are particularly observant. A risk of inflation is a growing cloud on the horizon, but large factors remain uncertain in trying to access this looming threat and possible disaster in the next several years in the form of hyperinflation.
3. GDP will have an up and down year, with a range of <1.6> to +2.2 % in quarterly changes. The first quarter will be decent with a minimal increase, but the final two quarters should see declines. Demand will continue to be soft at best, and nonexistent to an extent for some goods and services. Most nonessential manufacturing will be all but completely shut down. The second half of 2010 will be worse than the first half, and it is clearly possible the US will collapse into a second or echo recession far worse than the one that statistically ended in late summer of 2009.
4. Corporations have largely found the solution to keep themselves alive, and that is to hoard cash and run lean and mean. That means little if any investment and growth, and keeping inventory, staffing, and hiring to a minimum, with continuing downscaling and layoffs in order to keep stock prices at a optimal level. Small business will remain moribund with little expansion and growth in the coming year. One place where failures will increase is with banks. After 140 failures in 2009, expect bank failures to near and possibly exceed 200 in number. Of course, large banks, buttressed by federal bailouts, will report record revenues and profits, and bonuses and payouts to executives and management will be appallingly obscene as these entities continue to only affirm their place as the dominant institution and power players in the United States, and to a slightly lessor extent, globally.
5. Housing values and prices will continue downward at varying paces depending on the location and region. Overall, nationally housing prices will lose about 5 - 8 %, but some places will see a decline just in 2010 of better than 20 - 25 %. There is such a huge supply of available homes and overbuilt communities to fully dispel any price growth. New home construction is largely dead across the nation and will continue to be so for the next few years. Federal tax credit programs will help allow for some sales and existing home improvements, but these programs could expire which will only worsen matters. Home values and prices remain several years away from a bottom, and a generation or more away in some areas.
6. One area completely certain to increase and worsen will be with foreclosures. 2010 could see the total number of foreclosures exceed three million in number with a large number of unconventional mortgages due to adjust this year, as well as increased unemployment and hardship. The ever increasing number of vacant houses due to foreclosures only contributes to declining home values and prices, and bloats the inventory.
7. A number of states will struggle with massive budget deficits, and will continue to ruthlessly reduce services and programs to the most helpless and unfortunate in society: children, women, the elderly, handicapped, undereducated, and infirm. Some states will have to borrow money from the federal government just to meet mandatory obligations like unemployment compensation. A state declaring bankruptcy is not out of the question. Among the states in the most dire straits include California, Nevada, Arizona, Colorado, Wisconsin, Michigan, and New York.
8. Oil prices largely went up throughout 2009, and this trend is likely to continue in 2o10. The forecast here is for the benchmark price of a barrel of oil to be between $70 and $110, with the higher end more the trend than the lower end. Only because demand is relatively soft does the price not approach the 2008 numbers. Of course, a significant world event or crisis could lead to prices spiking temporarily higher, but a spike of this order is likely to be a short term occurrence lasting less than 3 months, but it would result in a higher base price being set for the next year out.
9. Global warming and climate change will continue unabated and still somewhat unnoticed on a macro level outside of the northern and southern latitudes, and by those in the know. The biggest consequence of the change now being observed is much more severe storms, with torrential rainfall and flooding occurring. Heatwaves will also increase, but probably not yet to an extent where concern by most people increases. 2010 is likely to be recorded as the hottest year on the planet, but North America will not share in that number for the most part. The Arctic icecap should shrink to a record size of smallest extent, and continuing changes in Antarctica will be observed that are troubling. Loss of fauna and flora species is underway, but noteworthy losses will not be finalized in 2010, but the downward trend toward an inevitable end will continue unabated both for the known and largely unknown species globally. This writer believes the year of the big jolt of change of global warming is now perhaps as few as just a few years away and no later than around 2018. The Planet Earth is headed towards a 4 degrees C global temperature increase within a generation.
10. The 2010 elections are likely to see Republican advances, resulting in a stalemate for the remaining two years of the Obama administration on legislative and policy agenda. Expect little if any legislative successes in 2010 and no policy successes to address vital American citizen issues such as climate change, poverty, infrastructure, labor, and income inequality. World affairs will continue to take an inordinate amount of the administration's focus and direction, with the eternal unrest and crisis across the Middle East; growing instances of terrorism, fatalities, and uncertainty with Afghanistan, Iraq, Pakistan, and beyond; increasing saber rattling by Russia, North Korea, and Iran; paradoxical perils and fears with China and its economy, military, and aspirations on the world stage; and growing famine and hunger in increasing numbers globally. Terrorist strikes and increased insurgency and unrest in places like Pakistan and Yemen are likely to result in expanded American and allied military presences there.
11. The price of gold will continue to rise with a threshold exceeding $1350 per ounce met during the year. Meanwhile the US dollar will continue to decline, slowly easing downward relative to other currencies throughout 2010 for the most part. 2010 very well could be the end for the dollar as the global benchmark currency as moves are underway in a number of nations to end that status. An increase in that trend would be disastrous for the American currency in almost unimaginable ways. The possibility of a collapse of the US currency grows more likely as each years goes by.
12. Stock indexes are now proven to be completely irrational and out of touch with the nation at whole. With that realization, the range expected to be seen in most indexes will undergo minimal changes. Expect a range of about 10-15 % either way throughout the year, as the Dow, NASDAQ, S&P, and others increasingly prove to be quite irrelevant in the true big picture.
13. Credit availability will be but absent across the nation, and even large, established proven organizations will find it difficult to find any financing even if they want to grow and expand. There will only be a handful of mergers proposed at all. The staggering federal deficit will cast a tall shadow over the nation's economy, stifling opportunity and improvement for most. Federal rates will remain largely near zero and unchanged for the year ahead as they have in 2009.
14. Finally, and most importantly, Americans will continue to grow increasingly disillusioned and dispassioned. A malaise has grown across the nation, and many Americans have responded by withdrawing and hunkering down and holing up. Ratings for NFL and college football have set tremendous records this autumn which reflects this trend. Frugality, self-sustainment, and self-substanance are the order of the day now for most and increasingly more people in the United States. Expect low turnout in elections this year which will only prove to help Republicans score gains in many regions. The only possibility to the the opposite is the possible split of the Democratic Party with the formation of a progressive, anti-corporatist third party which could grow into a significant player for the 2012 election.
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As stated last year, All in all, 2010 is looking to be a worse year than '09, mainly due to all the problems that were created in past years and have been festering, waiting for right time to explode. Very few citizens will be able to avoid having mud land on them to at least a small extent, giving them great pain and increased hardship and tragedy. The US continues to take significant steps towards state fascism, with corporations that parts of oligopolies continuing to gain power and financial wealth at the expense of the American citizen and their long beautiful history of democracy and direct-election voting.
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