When I was a 22 year-old Air Force sergeant the United States was facing recession during the Bush senior presidency. I was talking with a co-worker, another Air Force enlistee of higher rank, about the economy and she said something absolutely dumbfounding.
“I know I’m going to start watching what I spend. I’m really going to have to watch my money in this recession.”
As a member of the armed forces her income wasn’t at threat, nor was it going to change. Being at war, she wasn’t in danger of being laid off – in fact, the opposite was true.
When someone says “The sky is falling” people love to believe them. Have you ever wondered why people would rather believe in the possibility of bad over the possibility of good? Both are as likely to occur and both require the same effort / energy.
Reality is this:
A. We already know the economy is in a funk.
B. We probably have no idea how bad the mortgage crisis is going hit. Maybe I’m contradicting what I just said, but I don’t think we’ve even seen the tip of the iceberg. Based on statistical data I think we should expect that current home values will drop by 30-40%. As a result many, many more people will be walking away from their homes and the mortgages on them.
C. Many more people are going to be losing jobs. It isn’t as bad now as it is likely to be. Talking with a neighbor who works with a government agency, he says current projects are being completed, planned projects are being canceled. Cancellation of projects means more jobs going away, which has a ripple effect.
D. Loss of jobs and higher unemployment means crime.
Which brings us to the hot products of the coming year – security items.
Job security, financial security, home security.
Anything that helps people feel more secure is going to thrive. Make your own list of concerns right now and you can bet others have those concerns too. Listen up to the conversations going on in coffee shops, at the grocery store, etc. – hints are being dropped everywhere.
This conversation came up at lunch yesterday: Should I keep paying my mortgage? That’s a question in a lot of people’s minds, especially those who paid more for their home than it’s currently worth – or likely to be worth. If people are bailing out on their mortgages, then what?
They’ll become renters (and the cost of renting will rise). The banks are going to own a glut of home inventory. Real estate agents are going to be out of business.
Answers to these problems and information about how to take advantage of the situation – and prosper – are going to be hot topics.
And, dare I say, so is “How to Make Money Online” information.
I think we’re going to see mass relocation’s as people lose their jobs, seek more affordable housing and leave rising crime in the city.
Let me make my point clear: There is always opportunity and even in the current financial crisis, there will be opportunity if you foresee what’s coming and position yourself now. Because many *will* be caught up in the financial downturn does not mean that you need to go with them.
All the best to you and your family in the year ahead – X
PS – Support a great cause and check out Stu McLaren’s Prediction Call series
