PredictingtheFuture

There are certain things a shrewd columnist should never do; chief amongst them is any attempt to predict the future. This article proves that I am not very shrewd as I am going to attempt some forecasting.

We start with a relative no brainer; Obama is going to be the next President of the USA. I’m not suggesting who my preference is here, as its not relevant, me not being American and therefore unable to cast a vote.

Once Obama is elected and in office I truly hope that the security services does everything to enhance his personal safety as he is sure to be a target for every nut case on the planet, particularly American lunatics who view him as if he were the anti-Christ.

The next people likely to test Obama once he’s in the White House will be the Russians, as its almost impossible to see President Putin not seeing how far he can push the new man. The likely spot for the test will be the Crimean Peninsula of the Ukraine, in which the majority of the population is ethnically Russian but the government is Ukrainian. The situation is made more volatile by the Ukrainian government wishing to move west politically whilst the Russian fleet has its base in Sebastopol within the Ukraine. This is the Georgian scenario writ large, and is a boil waiting to burst.

Also itching to test the new President will be the Iranian government who, like a certain Sadaam Hussein, can’t wait to goad the new man with turning their nuclear enrichment program into building nuclear weapons they can rattle at the Israelis.

This in turn will signal the new leader of Israel, who at that time will most likely be Ms. Livni into taking military action unilaterally against Iran. You might think I am over egging this pudding by signaling so many dangers but Obama scares me not because he is weak, but because extremist leaders who run other countries will perceive him to be weak.

All of this is threatening enough but doesn’t take account of potentially the biggest danger of all, the still unfolding economic crisis.

We are possibly reaching the end of the beginning of the collapse of the old forms of capitalism and don’t know yet what is going to replace it. For sure it will not take the same form exactly as its predecessor. Too much trust has unraveled for too many people for that to be possible.

Eventually the banks will be forced to unfreeze sufficiently that money will start to flow more easily inter bank and then onwards to all of us humble peasants who can qualify because of our exceptional credit worthiness. It is likely that meeting the criteria of the credit checkers will be well nigh impossible.

Property prices in the Anglo American markets will continue to fall, probably, on average bottoming out at about 30% to 40% below their peak before they start to rise again. Rental values, particularly in the UK will move in the opposite direction.

Jobless rates will rocket in many parts of the world, but will then begin to level out since the recession will not hurt the entire economy equally. There might be problems in some countries that have experienced large-scale economic immigration. As the economy shrinks there will be those who lose their jobs who will then blame the immigrant population for their ill fortune.

Raw materials and fuel such as oil will continue to drop in price simply because supply, built up to meet over demand of the recent past, far exceeds presently diminishing needs.

Manufacturing powerhouses like China will suffer huge problems as over capacity is slashed to meet the new realities. In certain sectors of their economy, such as toy production, they have already had about half of the manufacturers go out of business in the last year. This will spread across their offering.

Banking will lead the recovery of the markets that we can guess will start to meaningfully revive in about 18 to 24 months. The “real” economy might well take that long again to approach the prosperity we previously enjoyed. But, on the plus side, there will be an economic revival around the time Obama will be standing for a second term. We will survive the threats, posturing and brinkmanship but it is going to be tough and tricky for the next year or two. Now, if you keep this blog you will probably be able to wave it in my face in the near future to demonstrate how very foolish I was to make predictions!