Some interesting predictions for 2008 (relocation, real estate, travel)

[jazzlover]

These two stories do not mention Colorado, but Coloradans should take note. The first is a New York Times story on the real estate bust in Florida. It's pretty sobering. Scratch out "ocean" and "beaches" and replace with "mountains" and change "Florida" to "Colorado" and you may get a pretty good picture of what lies ahead for Colorado. The rest of the "scenario" sounds ominously similar--Florida is just getting there first. Link: http://www.nytimes.com/2007/12/23/bu...=1&oref=slogin

The second is from the very politcally incorrect website of writer James Howard Kunstler ( James Howard Kunstler ), upon which he has posted his (very dire) predictions for 2008.

I will risk ecountering the wrath of the Moderator by quoting one full paragraph from Kunstler's 2008 predictions. I think it to be too important not to be readable right here:

One thing the public doesn't get about the housing debacle is that it is not just the low point in a regular cycle -- it is the end of the suburban phase of US history. We won't be building anymore of it, and those employed in its development will have to find something else to do. Now, unfortunately the whole point of the housing bubble was not really to put X-million people in so many vinyl and chipboard boxes, but rather to ramp up a suburban sprawl-building industry as a replacement for America's dwindling manufacturing economy (emphasis added). This stratagem ran into the implacable force of Peak Oil, which not only puts the schnitz on America's whole Happy Motoring / suburban nexus, but implies a pervasive trend for contraction in everything from the daily distances we can travel to the the very core idea of regular economic growth per se -- at least in the way we have understood it through the age of industrial capital.

Few places in the US have bought so heavily into the "sprawl-building industry" as has Colorado, so I think this prediction has especially ominous overtones for this area. As I write this, CNBC reports that this, the first trading day of 2008 on the stock markets, is the "worst beginning of year start" for those markets since 1932 (that was in the depths of the Great Depression, if anyone is checking) and oil futures have hit over $100/barrel.

I'm sure this will engender a flood of comments--I sure hope so.

[Mike from back east]

Site owners don't mind small amounts of quoted material, to give an idea of the larger story to which it is linked. No problem.

[jazzlover]

Originally Posted by Mike from back east

Site owners don't mind small amounts of quoted material, to give an idea of the larger story to which it is linked. No problem.

Thanks, Mike. I didn't want to step over the line, but I thought the quote to be salient.

[Charles]

Originally Posted by jazzlover

the first trading day of 2008 on the stock markets, is the "worst beginning of year start" for those markets since 1932 (that was in the depths of the Great Depression, .

It's time to buy. Watch, the S&P will be up 18% for the year. If gas goes to $5/gallon, what is that a week? An extra $15 for the average driver? Big deal. Still not as bad as Europe.

Interesting thing about the stock market. It peaked in 1929, crashed, hit bottom in 1932. It didn't get back up to the 1929 level until 1954. Also interesting, the level in 1932 was 11% of it's peak in 1929, that's a 89% drop in three years. (These numbers are approximate...digging from my some-zymers memory.)

[jazzlover]

Originally Posted by Charles

It's time to buy. Watch, the S&P will be up 18% for the year. If gas goes to $5/gallon, what is that a week? An extra $15 for the average driver? Big deal. Still not as bad as Europe.

That ignores the fact that petroleum is a component in just about ever thing the typical American eats, wears, lives in, or drinks. The effects of increasing energy costs are really just starting to permeate the rest of the US economy--food costs, freight costs, plastic costs, etc., etc. If all I had to worry about was the increase in price to fill up the jalopy at the gas pump, fuel could be $10/gal. and I could still survive financially. But, factor in the fuel cost into everything else the typical American consumes, and the picture becomes far more bleak.

People obsess over the price of gasoline, but what they should really be following is the price of diesel fuel (actually, "medium distillates," which includes diesel fuel and jet fuel). That is what our freight transportation system runs on--trucks, trains, barges, jet airplanes, etc. Right now, diesel fuel is as high as 60 cents per gallon more than regular gasoline in some Colorado locations. As I quoted one of my oil industry acquaintances a few months ago as saying, "People drive on gasoline, but the economy runs on diesel fuel." When (not if) diesel surpasses something around $4.00-$4.50 per gallon (around $3.60-$4.10 +/- without fuel tax), I think you will see some very serious general price inflation and a general economy going deep into recession. I also think that would send what's left of the increasingly financially strapped airline industry into the tank. So much, then, for cheap air travel. By the way, nobody has figured out how to run a jet engine on corn cobs, wood chips, natural gas, nuclear fission, or solar power.

[Charles]

Originally Posted by jazzlover

That ignores the fact that petroleum is a component in just about ever thing the typical American eats, wears, lives in, or drinks.

You are correct. Good point I missed and that my co-worker mentioned just after I hit "Submit Reply".

[CareFreeAZ]

Those are great points as most of us in the general population always tend to forget about all the plastic's (toys,parts/components,beverage containers etc.) are made from petroleum. And Diesel fuel is a much better indicator of what drives the goods and services industry.

That said, regarding the whole suburbia issue, I'll be the first to bring up two newsworthy television items I saw. Migration/relocation of United States Residents(Basically people moving to the Western and Southern United States) is at it's highest. The Airlines, despite rising fuel costs, had set an all time high in terms of number of passengers flying. With migration, not everyone can live in the "defined central core" of every city. Hence, suburbia will always exist.

[DOUBLE H]

I appreciate the moderator cutting slack on this issue. Colorado is the poster boy for uncontrolled growth and has been for a long, long, time. It's time people wake up to this issue. Thanks Jazzlover!

[Mike from back east]

Originally Posted by DOUBLE H

I appreciate the moderator cutting slack on this issue.

I've been told the moderator is a really hip cool dude.....and such a hunk

[jazzlover]

Originally Posted by Mike from back east

I've been told the moderator is a really hip cool dude.....and such a hunk

But is he some cute little lady's "stud muffin?"

Couldn't resist . . .