Happy New Year everyone. And for my first post of 2009, I will present my fearless predictions for the economy / government / and various sports teams (so I’m not perceived as a complete and total egghead.) So without further ado, here is the 2009 “Fletch Forecast”:
- 2009 will be tough for many folks. There is no way around that. Jobs will disappear, and workers will be displaced (made redundant, downsized, rightsized, kicked to the curb, kicked to the curb with a steel toed boot, kicked to the curb with a steel toed boot and run over by the company limo on the way to a corporate retreat, etc.)
- Unemployment will rise. 8%… 9%… heck, there is a possibility that we will see double-digit unemployment in some areas. I will attribute this to several factors: the obvious downsizing in many industries, coupled with an increased aggressiveness in offering retirement incentives to older, higher-paid baby-boom workers.
- But from this chaos will come opportunity as well – it will present a chance for many companies to differentiate themselves from weaker competition. Like you’ve heard me say here before, it’s easy to compete in good economic times. So 2009 will cull the herd a bit in regards to established companies.
- Related to the above, companies that traditionally used cash will now look to leasing more and more. Equipment leasing can still be had, and companies will find out that it’s pretty darn profitable as well. However, lease terms will continue to tighten some, as equipment finance companies and banks look to limit losses and bad debt. But again, strong companies will be able to get credit.
- Continuing on the opportunity theme, not every laid off / displaced / “asked nicely to leave” ex-employee is going to sit in his or her Barcalounger™ watching Wheel of Fortune. 2009 will see record numbers of small business startups.
- Those small businesses will need help, and the new administration will answer. I predict the Economic Stimulus Act of 2008 will be renewed, and perhaps even enhanced. Meaning my old buddy Section 179 gets a nice little facelift.
- In fact, we will see several attempts by the government to help businesses. Meaning we may see the return of the Temporary Investment Tax Credit (MIA for almost a quarter century). Personally, my industry (equipment finance) would love to see something like this.
- The Titans will win the Super Bowl, the Yankees will win the World Series, the Celtics will win the NBA title, and the Red Wings will win the Stanley Cup.
- The Dow will fluctuate wildly – one day, it’ll be doom and gloom, then there will be a rally. Wash, rinse, repeat. Antacid sales on Wall Street triple. And at the end of the year, the Dow will sit right around 8400.
- Fuel prices have had enough of the roller coaster that was 2008. Demand has dropped, and will stay at lower levels, somewhat stabilizing fuel prices.
- Lastly, in order to stimulate the local economy, the government establishes the “FletchFund”, enabling the purchase of home theater equipment, a pool table, and that sweet tractor at Home Depot (the big one.) This is a fairly necessary step for a healthy 2009, and one I encourage Obama get right on.