Finance Predictions for 2017 and Beyond?

[Elsie N]

Looking for opinions from the community where the new leadership in the US will take the economy and why (slow growth, inflationary, stagnation for example) both here and in the rest of the world.

Please keep partisanship out of it as best you can. '-)

 

[Dan Kanes]

That coal mining Job I used to have will call me up and say "dude get your pick-axe!" As soon as I've got my van loaded up to head back over there, they'll call again and say "We've got some bad news... gonna have to cancel on you."

That being said, things in the entertainment industry may not change all that much... there may be slightly more work.

I predict many of us in the US film industry will be seeking something more stable (long term TV show?) but overall I'm planning on growing my client base this year and diversifying opportunities.

As a business owner - Tax Cuts overall are welcome. Generally here's my rule of thumb;

If you already have capital you will be fine and could grow it if played right.
Don't play the stock market unless (until?) there is a market crash.
If you're young (or older) and don't have capital - look at cost cutting measures - communal living space or make arrangements with your parents to split expenses and live at home.

Now is a time that family or alliances have never been more important.

If you have any feuds with blood or in-laws , it's a great time to try to mend your differences - even politically.

Even further along - my advice to anyone is - don't let political climate dictate your financial or emotional outlook (this took me a while to grasp) - be open to all opportunities and seize them unless they are counter to your moral compass.

Finally - have a moral compass.

I have a "code of honor" that I follow and apply to my business principles and dealings - it has served me well.

 

[Joel Voelker]

Damn Dan; wise beyond your years! I agree on all fronts.

I think large corporate tax cuts may actually increase ad spending. Things will likely get worse for the average person but our industry may get a boost. Keep looking forward, growing yourself and your business, and bettering yourself and those around you. The crazier things get on the international and national stages, the more focused we need to be on building local community and support. Those close to us are the people we need most when things are bad.

 

[Dominik Muench]

Finally - have a moral compass.

I have a "code of honor" that I follow and apply to my business principles and dealings - it has served me well.

Amen to that !!!

 

[Nick Morrison]

Remember, in good times or bad...people always watch content.

The larger dynamics affecting our industry - the move to digital, the internet, and cost cutting via in-house as sharable content becomes the norm - have nothing todo with who's in the White House.

In fact, the Governor's of California and New York are (ironically) invoking State's rights and suggesting it will be biz as usual.

 

[Terry VerHaar]

Generally - and I do mean "the big picture" - I suspect the economy will respond well in the short term to the Orangeman's policies; assuming he actually has policies and they somewhat resemble what he has promised.

But, over the medium to long term, we could be in trouble. If Trump spends like he is promising to (a billion $ on infrastructure?) that is one of the bumps for the short term economy - along with tax cuts. But, those two together could spell the longer term disaster. Borrowing is OK for awhile and in slow economic times - and we have been doing it for "awhile" to try to grow - but simultaneous spending and tax cuts simply don't add up and no amount of economic growth is going to make up for the huge deficit that will be coming under those conditions. Inflation is certainly a possibility.

Monetary policy is a wild card. The Fed may actually try to counteract some of the negative effects of possible short term hyper-growth with higher interest rates.

It is worth noting that the current rate of economic growth is 3.2% and unemployment is down to 4.6%. This represents a pretty decent economy even if it hasn't bee fairly distributed. Attempts to push it too far can be detrimental (did I mention inflation?).

Of course, the various mining and manufacturing jobs aren't coming back so that might be a good thing for keeping the economy from overheating. Maybe those people will get jobs on infrastructure projects. We can hope (for their sakes). In the longer term - 10 years plus - we should be concerned about many, MANY jobs being lost to automation and there ain't a damn thing Trump or anyone else can do about it. We will need an honest-to-goodness discussion about policy changes to deal with that.

And, of course, "in the long run we are all dead."

Good luck to us all!!

 

[Sean Keen]

looking at someone i think more American things will be popular next decade, less junk, more classic, anybody know American vintage lenses ?

 

[Stephen Pruitt]

As one of the few finance/economics Ph.D.s actively on this site, it is my professional opinion that the economy will be in much better shape in four years than it is today.

The main drag on economic growth over the past eight years has been an unprecedented regulatory stranglehold. I strongly suspect that this grip will be markedly loosened over the coming few years (and almost from Day One), with decidedly positive results for both employment and incomes. Union membership will be reduced over time, as will the economic influence of trial lawyers.

The geopolitical uncertainties of recent years (remember that "line in the Syrian sand"?) will also be dramatically reduced.

Entitlement spending is likely to be decreased over time compared with current trends, and may even decline in real terms. Similarly, spending on new armaments is also likely to increase in real terms.

Overall, I believe economic growth will rise to the 3.5% to 4.0% per annum range over the next couple of years, which will be a massive improvement over the less than 2.0 percent rate of the previous eight years.

On the political front, the Supreme Court (as well as all federal courts from the Courts of Appeals on down) will take a decided turn to the right. The elections in 2018 will result in an even larger Senate majority for the Republicans, as the Democrats will be forced to play on a field dramatically tilted to their disadvantage (defending over twice as many seats as the Republicans, most of which will be located in red states), and with a state-level bench emaciated as a result of the electoral depredations of the past eight years they will have very few strong candidates from which to choose.

Will everyone be happy with the changes? Absolutely not, but I do believe Mr. Trump is likely to be a shoe-in should he decide to run for reelection in 2020. But my prediction is that he will NOT chose to run again, leaving the field open for Mr. Pence or another Republican to (attempt to) take his place.

Of course, as Mr. Berra once stated, "It's tough to make predictions. . . especially about the future."

Stephen

 

[Nick Morrison]

Your predictions overlook the near historical certainty of a protest vote in first midterm, as has happened to every "change" President after a two-term incumbent leaves office. This happened to Reagan, Clinton, Bush W, and Obama.

American politics tends to work in meditated/repeatable cycles, no matter how qualified either party believes their victorious candidate to be. Awerica's swings from 12 years Republican (Reagan/Bush Sr), 8 years Democrat (Clinton), 8 Years Republican (W), 8 Years Democrat (Obama), bear this out (which does bode well for Trump in 2020, yes - though he may be too old to run at that point, so perhaps you're right about Pence, or maybe Ivanka...).

Your predictions also don't take into account this is the least educated and arguably least qualified/experienced Cabinet in modern history. We'll have to see how their decisions and anti-governmemt stances disrupt the economy LONGTERM. There's a reason leading economists worry about a bubble popping in 4 years.

And don't forget this same deregulation and speculation is what led to the Great Recession at end of W years, so we've also seen this before...Bush Jr's two terms were marked with tepid growth and job numbers, so your 4% growth numbers are very optimistic (and historically hasn't happened in decades, and may no longer be possible in our global, service economy).

So....you are right to quote Yogi...cuz we'll see.

 

[Terry VerHaar]

My own background is a B.A. in Economics and 12 or so years in investment business including 5+ years with a NYSE/Wall Street firm. About the only things I learned from that, for sure, is 1) never try to predict the stock market (or the future, for that matter) and, 2) I am not an expert - in anything.

That said, I think the assumptions made by Dr. Pruitt are rather "out there." Geopolitical uncertainties lessened? Really?? Maybe if WWIII starts sooner rather than later. The main economic drag being regulation? Hmmm... I seem to remember a near depression somewhere in the recent past. As far as economic growth rising to 3.5-4.0 percent, it is almost there already (current growth rate at 3.2%) and the kind of spending + tax cut stimulus rhetoric that has been thrown about could blow that number up rather dramatically - and not in a good way. If the economy is indeed "better in four years," I'd say we will most likely be on the edge of a precipice (having, apparently, not fallen off of it yet).

I vote with Nick here.

 

[Stephen Pruitt]

'twill be interesting.



Stephen

 

[PatrickFaith]

I do most of my economic math ( which is used all over the place for the last 30 years) based on efficiency/productivity using a quant/observer method rather then the traditional force/limit methods. Anyway I see a knee increase in efficiency/productivity in 2017 with a trend set in 2020. Simple ratio examples are bytes (storage) per btu, or specint / $ , $ cost transit / hour of use. An easy example is the cost transit / hour use: my current car costed around 52k and I use it about 5 hours per week with a bunch of expenses (i.e. sits mostly), I'm transitioning to renting transit & electric at around 50$ per week which is a huge efficiency increase (in both btu, net $, transit time reduction, insurance). When you hit a economic knee in efficiency/productivity it has the primary effect on the economy.

 

[Meryem Ersoz]

The main drag on economic growth over the past eight years has been an unprecedented regulatory stranglehold.

Don't take this the wrong way, but I am always puzzled by this bit of dogma. When I look at actual corporate earnings, I see no actual evidence of an unprecedented regulatory stranglehold. GDP registers one story, while actual earnings reports from major corporations register entirely another story - breaking records all over the place. The S&P has returned an average of 10% across Obama's eight years in office, which is above average over time. Yet Republicans carry on about this "stranglehold." The middle class is suffering, for sure. But there are reasons beyond corporate prosperity that this is happening.

The top 30 US corporations holding offshore cash are sitting on a $2-3 TRILLION dollar pile - hardly symptomatic of a "stranglehold" to growth.

I own stock in 30 small banks across America - all of them performing above analysts' estimates, returning an average 2.5% dividend yield. Small banks aren't struggling.

The middle class is struggling because of automation, lack of job security, the offshoring of jobs - but corporations are fatter than ever. So I just can't wrap my brain around this regulatory "stranglehold" that is so often repeated in the media.

Regulations will be loosened. But this will just make it easier for these same small banks to get bigger through consolidation - it's not going to make a whit of difference in their ability to originate loans, grow their depositor base, or any of the activities which create real, organic growth. On the contrary, in an inflationary environment, these things become HARDER, and, as a result banks grow through buyouts and mergers - which will become easier with fewer regulations. But that is different from organic growth, and, in fact, ultimately results in streamlining operations and in fewer jobs.

 

[Dan Kanes]

Thank you Meryem - way more eloquently put than I would have.

Regulation is the only thing keeping the wolves and vultures from picking clean the bones of anyone not in the top 0.5%

 

[David Collard]

Judging from previous presidents and my historical knowledge, I'm not worried about Trump. Lots of positives to be revealed within the present fog.
However, the U.S.A. is increasingly one of many nations in a very competitive world with unpredictable world economic borders.

Best advice that stands the test of time...Pay down debt, although I'm betting for better temporary growth in the U.S., and the entertainment business
will continue to flourish in the higher end. However...

The world is truly getting smaller and the corporations are sending jobs abroad. Manufacturing in the U.S. is increasingly using A.I. and robots (in farming too).

Further down the road... Old school should become the new school. Less reliance on material things and a return to more self-reliance as well as organized community self-reliance.

Excuse me, I need a beer...

 

[Dan Kanes]

N

N

I'm 100% down with self reliance.

The thing that cracks me up about your note about less dependence on material things reminds me of a time we went through in this country not that long ago called "the Great Depression."

Hoping and Praying for all of us that is not our fate. (I won't let it become my fate - there's that self reliance again).

Just had one more thought - thinking about regulation - I'd love to see better food regulation in this country.

More people than ever before are sicker than ever before. I would posit (and many others would do same) That a great portion of the illness and obesity of our population is from chemically treated, processed, maximally profiteered food. Big Food is helping Big Pharma and hurting big healthcare. I've eaten wheat for the previous 30 years of my life and began having massive inflammation and nerve pain at age 33. Stopped eating wheat (and cut carbs and sugar DRASTICALLY and feel healthy again.) The same farm and manufactured food lobby taking away farming jobs with robotics is the same industry killing us with pesticides, corn sugars, and other unedibles. Regulation (or self reliance) against these interests seeking to kill us while vacuuming up what little cash we have is something I would fight for.

 

[Elsie N]

Judging from previous presidents and my historical knowledge, I'm not worried about Trump. Lots of positives to be revealed within the present fog.
However, the U.S.A. is increasingly one of many nations in a very competitive world with unpredictable world economic borders.

Best advice that stands the test of time...Pay down debt, although I'm betting for better temporary growth in the U.S., and the entertainment business
will continue to flourish in the higher end. However...

The world is truly getting smaller and the corporations are sending jobs abroad. Manufacturing in the U.S. is increasingly using A.I. and robots (in farming too).

Further down the road... Old school should become the new school. Less reliance on material things and a return to more self-reliance as well as organized community self-reliance.

Excuse me, I need a beer...

While I certainly agree that being as debt free as possible is good, I question if this is the time to pay off low interest debt while keeping asset liquidity that can easily be turned into cash. Credit card companies are still offering attractive 0% balance transfers or even checks for depositing in an account at 0% for 12 to 18 months.

And one thing I'm noticing is there is often only a 1% up front charge for this when previously it was 3%. It seems they still see things staying stable for that period of time at least, and it is their business to research these things.

 

[Elsie N]

I'm 100% down with self reliance.

The thing that cracks me up about your note about less dependence on material things reminds me of a time we went through in this country not that long ago called "the Great Depression."

Hoping and Praying for all of us that is not our fate. (I won't let it become my fate - there's that self reliance again).

Just had one more thought - thinking about regulation - I'd love to see better food regulation in this country.

More people than ever before are sicker than ever before. I would posit (and many others would do same) That a great portion of the illness and obesity of our population is from chemically treated, processed, maximally profiteered food. Big Food is helping Big Pharma and hurting big healthcare. I've eaten wheat for the previous 30 years of my life and began having massive inflammation and nerve pain at age 33. Stopped eating wheat (and cut carbs and sugar DRASTICALLY and feel healthy again.) The same farm and manufactured food lobby taking away farming jobs with robotics is the same industry killing us with pesticides, corn sugars, and other unedibles. Regulation (or self reliance) against these interests seeking to kill us while vacuuming up what little cash we have is something I would fight for.

While in complete agreement with all you've said, I wonder if the most cost-effective approach to good food is education... that is, fight the big food companies touting their twinkies as being GRAS (generally recognized as safe) with ad campaigns against these unhealthy foods. That's what has happened in anti-smoking campaigns and while I have no idea if that has been effective, it stands to reason it should have had some good effect.

As things stand, there is good information out there for those who will spend the time to read it. But I think the people you are saying would benefit from better food regulation are the ones whose time is taken up by their jobs and then their home life after work. They just want to have a life and hope the regulatory system will protect them from being doused by Dow or DuPont or Monsanto.

I'm just thinking out loud as I wonder if the solution isn't from the bottom up rather than from the top down. Social Media may be the answer where a groundswell of rebellion against one food or another causes the manufacturer to change the ingredients or the source of their ingredients in order to keep customers.

For me personally, it's not a problem. I eat for fuel and have a small number of safe foods I eat while supplementing for any nutrition gaps.

But then, I'm not living the American Dream with all its pressures and demands.

But for most families, food is a big part of the budget and most of the damaging foods are the cheaper foods. If they are made safer, they will cost more.

Interestingly, I am seeing some of the things I bought just a few months ago advertised at a higher price now... one item that caught my eye is as much as 20% more.

Will this translate to the equipment used in our industry?... or will Moore's Law continue to give us more for less?

 

[PatrickFaith]

...

Just had one more thought - thinking about regulation - I'd love to see better food regulation in this country.

More people than ever before are sicker than ever before. I would posit (and many others would do same) That a great portion of the illness and obesity of our population is from chemically treated, processed, maximally profiteered food. Big Food is helping Big Pharma and hurting big healthcare. I've eaten wheat for the previous 30 years of my life and began having massive inflammation and nerve pain at age 33. Stopped eating wheat (and cut carbs and sugar DRASTICALLY and feel healthy again.) The same farm and manufactured food lobby taking away farming jobs with robotics is the same industry killing us with pesticides, corn sugars, and other unedibles. Regulation (or self reliance) against these interests seeking to kill us while vacuuming up what little cash we have is something I would fight for.

This pretty much nails it, food distribution is pretty much the number one drag on economic efficiency. On the wheat/corn debacle - where wheat isn't a vegetable and corn is a fruit - I view that as the primary productivity drag leading to the depression:

Gov & Banking told the population to get a piece of the $ pie through wheat&corn mass production -> population became financially leveraged with unsustainable productivity on wheat production -> wheat production productivity crashed creating the dust bowl -> bankers got out before the crash creating the stock crash for the general population -> bankers bought the farms from crashed population creating the food system we see today -> wwII overshadowed the government investigations of the dust bowl/crash and still creates&enforces regulations similar to what lead to the dust bowl(i.e. so the circle is complete).

Literally all that's needed to reverse this trend is for everybody to buy every week organic carrots/lettuce (hopefully some other things too) & organic eggs/meat (i.e. non-fruit/sugar fed).

 

[Elsie N]

This pretty much nails it, food distribution is pretty much the number one drag on economic efficiency. On the wheat/corn debacle - where wheat isn't a vegetable and corn is a fruit - I view that as the primary productivity drag leading to the depression:

Gov & Banking told the population to get a piece of the $ pie through wheat&corn mass production -> population became financially leveraged with unsustainable productivity on wheat production -> wheat production productivity crashed creating the dust bowl -> bankers got out before the crash creating the stock crash for the general population -> bankers bought the farms from crashed population creating the food system we see today -> wwII overshadowed the government investigations of the dust bowl/crash and still creates&enforces regulations similar to what lead to the dust bowl(i.e. so the circle is complete).

Literally all that's needed to reverse this trend is for everybody to buy every week organic carrots/lettuce (hopefully some other things too) & organic eggs/meat (i.e. non-fruit/sugar fed).

Just read this and remembered your post. The amount of waste is astounding!