This is the thing to do as one year draws to a close and another begins. Here are my predictions for 2009.
I am not a prophet, so most of what I am writing is likely nonsense. My qualification for offering predictions for the future of a geopolitical happenings is exactly nil. But that will not stop me for you will not be able to ridicule me for being so completely wrong for 12 months. I think that 2009 will be seen in the future as the year when the seeds of a future great conflagration began to sprout. This is momentously scary time. As you will no doubt be able to tell, I am not in a particularly optimistic mood. Here Goes.
Temporary uphill before going off the cliff. In the first half of 2009 we will see a modest recovery in the U.S. economy only to be followed by even more serious financial turmoil and deepening recession. When I say recovery, I really mean a slowdown in the negative growth giving some false hope that the recession may be nearing and end. Instead it will be the beginning of even harder times.
Runaway inflation and unemployment. All this stimulus and cheap money designed to address the slowdown will actually make things worse. It will give us a head fake toward recovery but soon will have the opposite effect. It will lead to runaway inflation beginning in the second half of 2009. This inflation could top double digits and beyond in 2010. Unemployment the same.
More Riots in Europe. What will be hitting us economically will also hit Europe and maybe just as hard. The riots these past weeks in Greece are just the beginning. Ostensibly related to a police shooting, the real cause was economic. Greece is an economic basket case with massive crushing debt. The fact that this rioting has spread to other European cities shows that this frustration is widespread especially among youth. All this is just the beginning of the woes. As the economy dramatically worsens in the second half of 2009, rioting will be more widespread. Italy, France, England, and Germany will not be spared.
Russia. The war weary and economically troubled U.S. will retreat from the world creating a vacuum that will eventually be explosively filled. This isn’t really a prediction since it is already happening. The U.S. is trying to fulfill its obligations in Iraq and Afghanistan, but has thrown up its hands at many of the worlds other issues. Russia will continue to provoke and test the U.S. but our responses will invariably be weak. Georgia was the first step and the military visits to Venezuela and Cuba were the next ones. Russia will get bolder and bolder in their moves and may even conduct another military invasion in one of their former satellites. The U.S. will condemn but again do nothing. As a result, all of eastern Europe will tremble.
Germany. Germany. Germany. This is where I really think we should keep our eyes. Germany is the economic and political powerhouse in Europe. As the U.S. fades from the scene, look for Germany to cozy up to Russia. Germany gets much of its energy from Russia and cannot now do anything to provoke her. Look for Germany to look the other way if and when Russia begins reacquiring its satellites. As a result, Europe and NATO will do nothing to oppose Russian aggression. The rest of Europe will be slow to realize the threat posed by this unholy alliance as they are consumed with economic woes and disgruntled populations. They will eventually realize, but it will be late. As always in Europe that eventually means war. Obviously this not all happen in 2009, but the we will see the beginning of it taking shape during the year. Whether in 2009 or after, look to Germany to find a more assertive leader. In these times of economic distress and faced with a more aggressive Russia, the Germans will seek a leader who is more assertive of Germany’s place in Europe. As you know, that never ends well.
Also look for the fringe anti-immigrant groups to gain in popularity and strength throughout Europe when riots and upheaval break out in the various economically depressed immigrant ghettos. The happenings in France summer before last are just a taste. Faced with economic problems of their own, Europeans will be less tolerant of this protest and more receptive to an anti-immigrant sentiment. We might see some growing public racial incidents through the year. Most won’t take much notice of it, but it will happen with increasing frequency.
My world champion NY Giants will lose in the first round of the playoffs but the Mets will win the world series. This is prediction I am least confident about.
Iran gets the bomb and Israel does nothing. Without the U.S. backing it and afraid of going it alone against the Arab response, Israel will not attack Iran. Instead, with much fanfare, Iran will make a very public show of becoming a nuclear power. As a result, the entire world will be much less safe.
After all the silly talk about Obama moderating, he will carry through on his threat to promote and sign FOCA. In 2009, at least one of the liberal justices who have been waiting out Bush will resign and open a SCOTUS spot. Obama will fill this with a radically pro-abortion candidate ala RB Ginsburg. Some of his spending plans will be limited by the facts on the ground, but his social agenda will proceed unfettered.
I have been predicting this one for a while, but I think this may be the year it finally happens. Emboldened by the success of the Somali pirate industry, Islamic terrorists will attack a cruise ship killing hundreds or thousands. The ultimate high profile soft target. Overnight, an entire industry will be destroyed and the general populace will be reminded of their vulnerability. Democrats will, of course, blame everybody else even though they run everything.
Open hostilities will break out between India and Pakistan. Not a full scale war but the beginning of a cycle of attack and retaliation. Pakistan, increasingly a failed state, will be unable to control the more radical elements in that country. Another high profile incident like in Mumbai will force India to act. This is one big powder keg with nuclear weapons involved. A large, but as of yet unanswered question, is how will the west attempt to secure Pakistan’s’ nukes once it is clear the state is failing. My guess is that the U.N., NATO, Europe and the U.S. will wrangle unsuccessfully over this issue while India sits in the cross hairs.
This is all just a precursor to what is looming. 2011-2012 is when things will get even worse. I am probably wrong about all this but just in case I am not, now I am on record.
Oh, and by the way, the new Terminator movie will stink really really bad. Highlander II bad. Jar Jar Binks bad. I mean Superman IV: The Quest for Peace bad.
So there it is. War, rumors of war, and bad sequels. Bad times.
December 17, 2008 at 4:19 am
Steve: http://en.wikipedia.org/wiki/Kool-Aid
Don’t keep drinking it.
There are plenty of excellent sites that would bring you up to speed with what is going on in the real world financially. As one writer put it, “If you aren’t scared witless, you haven’t been paying attention.” Obviously you haven’t been.
Among these sites are, http://www.financialsense.com, and http://www.dailyreckoning.com. Also google Peter Schiff and watch some of his videos. These guys have very “extreme” views, but then again they have been right for the past five years in predicting the financial chaos we are living through. I think it was over five years ago that Daily Reckoning summed up its position and investment advice with the editorial, “Panic Now.” They were laughed off, as was Peter Schiff.
My only reason for going to these lengths is that I think many readers of this blog are heads of families. You cannot indulge the illusion that we are merely going into a relatively severe recession. That is the kool-aid gushing out of your TV. For a glimmer of what is really coming watch “The Cinderella Man”
Here is an excerpt from “Toby” a fellow on a restricted yahoo group I belong to who puts out a newsletter every three months.
This is a relatively brief excerpt from a six page essay with charts.
“Looking at the market today, there appears to be an intensified fear rippling through the credit markets. This is not just opinion but can be quantified by looking at US Treasury Bonds. Bond yields for the one and three month maturity are now at zero.
“Essentially investors are willing to get no interest at all for the privilege of holding US debt. I am aware of only one other time period this happened and it was in the 1930’s. Having no yield or interest rates well below 3% on long bonds leaves foreign investors with virtually no incentive to buy US debt. The following is a chart of the US 3-Month Treasury bond: What was considered a contained sub-prime problem back in March 2007 has blown into a full fledged financial crisis. We have seen US and world officials continually down play the unfolding of the financial meltdown all the while the intensity has increased. The US has spent $180 Billion last summer to spur the economy, spent $1 Trillion this fall, has pledged $8.5 Trillion in spending and guarantees, and yet economic activity is rapidly declining as evidenced by massive job losses, decelerating retail sales and huge losses in the stock markets. With US private and public debt at levels in excess of 300% of GDP, the clear and present danger is a deflationary depression.
“I had suggested I do not believe that this will be the likely outcome but suspect the US will succumb to an inflationary depression. The fundamental reason for my view is that the US has access to an infinite amount of cash via the printing press. The Treasury and Federal Reserve have shown it will do everything including skirting the law to prevent deflation. Now there are hints and evidence that the US is beginning to print money to pay for debts. This appears to be the only way that the US can prevent deflation as the amount of debt it can issue will be limited going forward with investors less willing to buy bonds with negative real interest rates in return.
“Unlike Japan, the US depends heavily on capital inflows to balance its trade and Federal budget deficits. This means that the US Dollar has to remain relatively stable to attract investors to invest in US equity and debt markets. In particular for debt instruments, the Dollar has to be strong enough as to not wipe out the annual interest payment. Expanding the money supply without a corresponding economic benefit makes the value of the money worth less.
“I believe that as the US follows a campaign of paying its debts with newly created money that it will cause the Dollar to fall. The rate of decline in the Dollar will be highly dependent upon the Central Banks of the world willingness to print as much money to equally offset the Dollar’s fall. Some of this will occur as we have seen China, Japan and Korea repeatedly weaken their currencies with respect to the Dollar. Europe, on the other hand, has been very resistant to play the game of the “first one to the bottom wins”.
“I believe there may come a time sometime in 2009 where the US spending binge, its ability to borrow and monetizing of debt will over-power competitive devaluation of other currencies (i.e. race to the bottom). This will cause a world wide exodus out of the US Dollar causing it to fall precipitously. As the Dollar falls, the price of imported goods will rise dramatically causing a surge in inflation in the United States. The economic slow down we are seeing today will accelerate as interest rates increase to compensate for inflation further choking off the consumer that is over-burdened by debt. Hence, the quantitative easing/monetizing of debt will likely result in the US going through a period of heightened inflation all the while economic activity slows: an inflationary depression. I do realize how extreme this position on the economy may seem to some readers but we must now think out of the box for the extreme conditions of the present day.”
Apart from whoever Toby may be, that is a very cogent argument for preparing for an inflationary depression.
(The Fed just lowered a key interest rate today to less than 1%)
But an inflationary depression in the US would have huge political consequences here and abroad, and military repercussions as well.
Who knows if things will fall out as I suggested above? Certainly not I, but history suggests, scripture suggests, and currents events suggest that events on that order of magnitude are on their way.
December 17, 2008 at 4:32 am
Also, when I say scripture suggests events on this order of magnitude are headed our way, I only mean the well established scriptural principle that sin brings down judgement, not that near term political, economic and military events are specifically predicted in the bible somewhere.
December 17, 2008 at 7:58 am
Patrick,
Sorry for posting her anon, I used to have a Catholic blog (Jay Anderson can vouch for me) I just don’t recall the password anymore.
I am glad to hear you are not a neo-con.
I guess we will have to agree to disagree, I won’t accuse Russia of provking until they are trying to bring Mexico and Canada into a millitary alliance or trying to partition Scotland off the UK or something else that really does affecct a US interest.
As to the conflict in Gerogia, need I remind you, it was the Georgians who started it?
Maybe you weren’t vilifying Russia but they sure came off looking like bad guys in your list of predictions, saying Eastern Europe would tremble. Catholic Poland has more to worry about with the EU forcing gay marriage and abortion on them, then they have to worry about Russia having links with Latin America.
As to my biases, I clearly admit I am pro-Russia, I am very anti-soviet, but I like Russia in the tradition of Dostoyevsky, Solzenheytsen, and possibly Medvedev.
I believe that your comment is evidence of your biases, not mine.
December 17, 2008 at 1:24 pm
Lee: I apologize for my uncharitable post. It seemed funny yesterday. I am sorry.
I don’t have a large family. I’m at #1 right now, but hoping for a larger fam. In fact, this economy has hit us to the point where we are uninsured so we are using NFP to delay until I can hopefully get a more permanent job.
Perhaps my misdirected snark was more resignation that my family size may be limited for a long time. ):
December 17, 2008 at 5:49 pm
Steve,
Thanks very much for your note, Steve. All is forgiven, of course.
Regarding no insurance as a family limiting factor- I wonder. Of all the people born down the centuries, billions and billions, how many of their births were covered by insurance? Certainly not many! And in the future, will the human race come to a stop because practically no one will be able to afford insurance?
Many years ago as a young married man I was working as a limo driver with no benefits. The prospect of a better job opened up, a job with benefits. Whatever came over me to pray this way, I do not know, but for some reason I emphatically wanted to pay for the birth of my child from the sweat of my own brow, so I prayed that way. “Please, Lord, I want to pay for this birth myself.” I got the job, but failed by a few days to qualify to have my wife’s delivery covered. An answered prayer! But then it was only $4000 out of pocket.
Now, it is a very different story, of course.
When my son was born a few years earlier, we were also “going bare,” uncovered. He was born with evantration of the diaphram, meaning that he could only use about 1/8th of his lungs’ capacity, and needed an operation costing $15,000. Really, I was wild with desperation. Not to worry, at the time the State of Illinois had a fund to cover neo-natal surgeries. It was all taken care of. Incredible, but not really. God knows how to rescue us from all our difficulties.
“Many are the troubles of the just man, but out of them all the Lord will deliver him.”
Tithe, trust in the Lord, pray and have children, Steve. You are covered by the Providence of God, the care of angels and the intercessions of the saints.
There is a way, but finding it depends on walking forward in faith.
December 17, 2008 at 8:08 pm
Mr. Lee Gilbert,
I felt like I may have been hijacking Mr. Archibold’s combox here, so I emailed you. If you see anything, rest assured it is not spam. Thank you.
Steve
December 17, 2008 at 8:44 pm
Today
“MOSCOW (AP) – New legislation backed by Prime Minister Vladimir Putin would allow Russian authorities to label any government critic a traitor—a move that rights activists said Wednesday was a chilling throwback to times of Soviet dictator Josef Stalin.
The bill, which is expected to become law, would expanded the definition of treason to include damaging Russia’s constitutional order, sovereignty or territorial integrity. That, rights activists said, would essentially let authorities interpret any act against state as treason—a crime punishable by up to 20 years in prison.
Activists said that would catapult Russia’s justice system back to the times of Stalin’s purges, calling it “legislation in the spirit of Stalin and Hitler.”
Nope. Nothing to worry about there.
December 17, 2008 at 8:46 pm
Nope. Nothing to worry about there.
Nothing for the U.S. to worry about.
December 17, 2008 at 9:36 pm
dcs
My post was about global geo-political happenings, it was not American centric.
Actually 80% my post was about areas other than the U.S.
Should we not care what happens in the rest of the world?
December 17, 2008 at 11:05 pm
Should we not care what happens in the rest of the world?
Well, sure, but caring and worrying are two different things, unless the next administration is so stupid as to think it can impose American-style freedom and democracy on Russia. Why worry about things you have no power to change?
December 18, 2008 at 12:58 am
dcs,
Honestly, I care about the fate of millions even if I am powerless. I am not *worried*
I am giving my predictions for geopolitical events for 2009. The events in Russia, Germany, Greec, India, and Pakistan are important whether they impact me or not. They are important whether I can do anything about them or not. As a Catholic I think I can do something, pray. SO I wrote about what I think might happen.
Why is this a problem?