This economic prediction is from Rawles on SurvivalBlog this morning:
I’ve recently been asked by several blog readers and consulting clients about my predictions for the economy for the next few years. Here they are, in a nutshell: The US economy will remain weak for for at least five years. Both the commercial and residential real estate markets are unlikely to recover before 2018, especially as interest rates begin to increase. Noticeable inflation should begin around the Spring of 2011 and will become uncomfortably high by 2012. If the announced Federal income tax and capital gains tax increases do indeed go into effect, they will stifle the economy for the foreseeable future. Continued financial instability in the periphery of the EU will continue to keep the Euro weak versus the Dollar, but in the end, both currencies are doomed. Global credit market chaos will probably continue for several more years, as will the Mother of All Bailouts (MOAB) here in the United States. I’d say that there is a 25% chance of a Dollar Panic and devaluation in the next four years, and a 5% chance of a hyperinflationary Dollar Collapse. But regardless, some inflation is coming. Its severity is difficult to predict. The bull market in precious metals is nowhere near its end. I still predict that spot price of silver will eventually exceed $50 per ounce.
I think it’s pretty close to what I would predict. When he says “…in the end, both currencies are doomed”, while probably true, could be a decades away. I think it’s interesting he’s picking 2018 as the earliest real estate recovery date when I picked close to the same thing last night (I was a little more optimistic, thinking 2015). The inflation prediction is his earliest prediction, so I’ll be watching for his accuracy.
Here’s another “I’m not an idiot” moment. Richard Fernandez wrote this yesterday:
But Barone implies that for all the apparent flux one thing remains constant: it’s a brake and throttle world. The liberals hit the throttle and the Republicans sometimes step on the brakes. Republicans haven’t noticed the steering wheel.
Yeah, that’s just about right, IMO. This ties in with the above prediction. That pessimism is born out of not believing that either party will do anything more than delay the inevitable. People tend to operate in their own self-interest, and a vast majority of politicians’ self-interest is diametrically opposed to the country’s self-interest. And as a rule, the longer they are “serving”, the more that’s true. Later he makes a comment that’s rather apropos to a conversation I had with my wife last night:
It may take more than hard times to make a political paradigm shift thinkable.
Or planting fruit trees, for that matter. How many people just can’t imagine growing their own food? All people create their own boxes of their minds that can be very difficult to break out of. Some worse that others, of course. Limits in thinking equal limits in action, so when an action is required that requires you to think outside your little box, you freeze.