Excerpt from The Trends Journal Winter 2009
Editor and Publisher Gerald Celente
The trends of 2008, while looking bleak, were not all gloom and doom. Germinating beneath the surface were seds of trends that in due course would sprout through the chaos of a dying age. What could not be recognized by those caught up in Panic as the “too big to fail” failed and the stock markets crashed, was:
• The system itself had aged and degenerated beyond resuscitation. In the natural course of organic life, it was time for it to die.
• Huge gaps left open by the out-of-business “too big to fails,” would be filled by nimble, farsighted entrepreneurs.
• For others capable of functioning within the chaos there would be rewarding opportunities, discoveries and inventions.
• From the ruins of the old the potential exists to nature the seeds of the new once they sprout and are recognized for what they are.
But before the seeds sprout, the entrepreneurs succeed, and the opportunities, discoveries and inventions are realized, America and the world will have to suffer through the flailing throes of a dying system.
Yet despite the hard evidence and indisputable facts, there are many who will twist, ignore and deny them; who try to convince themselves and others that the fundamentals of the economy are still sound and prosperity is just around the corner.
THE COLLAPSE OF ‘09
The “Panic of ‘08” will be followed by ‘The Collapse of ’09.” In 2008, when the world’s largest financial firms and equity markets crumbled, Wall Street’s woes pre-occupied the media.
In 2009, the focus will broaden to include a range of calamities that will leave no sector unscathed. Next in line is retail, which accounts for some 70 percent of consumer spending, 26 percent of which is holiday sales.
After the numbers are tallied to reveal a dismal retail Christmas, more big chain bankruptcies will follow. Besides leaving masses unemployed, defunct retailers will leave behind thousands of empty stores. Who will rent them? Nobody!
Add to these empties commercial space vacated by defunct financial firms and an array of troubled businesses, from restaurants to architectural firms, to high tech operations, to offset printers, etc., etc. The inescapable result (that we predicted over a year ago and is only now being discussed in the business media) is a commercial real estate bust that will be costlier, wreak greater havoc and prove more intractable than the residential market decline.
Because most people don’t live and shop on Wall Street, the “panic of ‘08” was viewed by Main Street as if from afar – even though many were losing money. But when commercial real estate crashes it will hit much closer to home. The depressive atmosphere of thinly shopped, half – vacant malls will strike emotional chords and all the senses.
In office buildings, vacant floors and empty cubicles will dampen the workday spirit of the still-employed; ever present reminders of laid-off friends and colleagues and of the fragility of employment.
Abandoned, untended business and industrial parks will highlight the already mournful scene. In cities studded with soaring towers and new construction predicated on eternal economic growth, streets lined with “For Rent/For Sale” signs will complement stilled cranes and uncompleted buildings.
As retail and commercial real estate collapse, the credit card sector and all its interrelated processing and back office support businesses will suffer and be forced to scale back. Hordes of consumers who have been living off credit cards and racking up debt to the limit will lack the funds to service their debt … much less pay it off, and they will be forced to default. Given the nearly $3 trillion in consumer debt at risk (excluding auto and mortgage) an inevitable default snowball will add momentum to the in-progress Collapse of ’09.
Trendpost: Taxpayer warning! All Levels of government will be caught up in the private sector collapse as tax bases shrink and tax revenues sharply decline. Attempts to make up shortfalls by raising taxes, tuition and tolls, and imposing higher user and license fees, will do little to resolve the problems, but will do a lot to infuriate citizens.
We forecast that during 2009, anti-government/anti-tax movements will take root and flourish. Tax revolt “kits” and how to get a referendum on the ballot will be formalized and made readily available over the Internet. A “Tax Revolts for Dummies: How to Work the System” guide compiled by some civic-minded entrepreneur or tax lawyer could become an instant best seller. http://www.trendsresearch.com/