2009 – An Outlook

  • Commercial real estate and consumer credit will be the next sub-prime crisis and companies from those industries will get in line for massive bailouts
  • The stock markets will drop to new lows, the S&P 500 will test new lows around 600 and bottom out some time between the end of 2009 and mid 2010
  • Home prices will continue to decline constantly
  • Government spending will soar beyond levels that Americans wouldn’t have dared to dream of in their worst nightmares
  • A new massive government public works program will spark an initial euphoria that will soon be disappointed by progressively worsening unemployment data
  • All measures taken by the government to stabilize consumer credit, home prices, domestic auto sales, employment and other things will turn out to be miserable failures and aggravate and prolong the crisis
  • New municipal bankruptcies will add to the ongoing credit contraction
  • Banks will remain unwilling to lend so long as credit keeps contracting
  • The savings rate will keep rising
  • Gold and silver will rise continuously but not excessively

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