Predictions for 2008
By John Schettler (and his good friend: “The Nattering Nabob,” Prophet of the Ages)

Predicting the future is best left to prophets like Nostradamus or Edgar Cayce, but at year’s end it is always fun to take a whack at the game. 2007 will probably be remembered as the year the country finally began to wake up to reality. As James Kunstler (a contemporary social prophet of sorts) put it: “That sound you hear out there is reality knocking on the door. It has been standing out in the cold for a long time and it is not happy with us.”

Reality in this case is the end of the realization that we can get something for nothing in this country, an end to the notion that we are somehow entitled to a life that continually appreciates in value, like a suburban track home. It is an end to the habit of simply buying anything we desire by using OPM (Other People’s Money, in the form of artificially created “equity” loans or Visa, Mastercard, American Express and Discover). The hard knock of reality has hammered the financial markets since the “credit crunch” of August ’07, but the real damage has yet to play out, or even reach the TV addled minds of most Americans. Soon, however, the truth about our situation will be impossible to hide on the troubled balance sheets of major US financial institutions. People who haven’t been following these events in the past year will wake up to a hard shock as the crisis ahead begins to affect their lives directly. For many, the shock will begin with the January delivery of their heating, electricity and phone bills, and credit card statements that will be so heavy they will have to be delivered Parcel Post.

As the year ended, however, the TV business sector news hosts were trying to keep some “feel good” going for the battered financial markets. They trumpeted the “Santa Claus Rally” in late December and touted that the S&P 500 was up 5.2% for 2007. Considering the fact that inflation was up at least that much, including energy, food (up 22% in ‘07), medical and other real costs the Fed likes to omit from that index, then that market didn’t make a nickel in ’07. In fact, when you consider that the dollar index started the year at around 85 and fell to an abysmal 74.48, you lost another 12.3% on your S&P 500 stocks—and all this during the year that saw the markets pushing all time highs.  Adjusted for inflation and the falling value of the dollar, the stock market as a whole lost money in 2007. Had you simply bought Euros with your dollars in January of ‘07, and then converted them back to greenbacks around Thanksgiving, you would have made a very nice profit. And incidentally, gold was up 30% in 2007, almost six times the performance of the S&P 500. So much for the Wall Street Wizards.

The entire game of buy now, pay later is about to come to a screeching end in America. But the bright side behind all the bad news is that necessity is the mother of invention. As people realize they can no longer live their lives by going deeper into debt, asking their future to pay for present desires, they will have to face reality and start living within their means. Since Americans spend 120% of their annual income, expect a retrenchment of at least 20% in “consumer spending” with all the attendant pain in the retail sector. But this hardship will really be much needed castor oil for the buying public. The American “consumer” is about to go on a financially imposed diet, and like any weight loss program that will make the top of many New Year’s resolution lists for 2008, it will be painful while promising better health ahead if we stick to the plan.

As the shock of recession ripples through the economy this year, people will slowly start to make the much needed adjustments of life style that will form the basis of a new way of living in this country. Therefore, while 2008 will be hard for many, it will also be a year of discovery, promise, and innovation as people begin to face reality and restructure their lives. The idea of standing in a line to spend $500 for a slick cell phone from Apple will be yesterday’s extravagant news. Tomorrow’s headlines will be about finding ways to stretch that thinning dollar, cooperative alliances formed at the neighborhood level to help make ends meet, ways of finding the resources we all need each day—right down to food, water and a way to keep warm. This is the reality that lies ahead. But after the shock, and the pain, there is still hope. As Barak Obama said in a stump speech last week: “Hope is knowing it will be hard, but still trying.”   And so in spite of the bad news I am about to deliver from a brief gaze into my Crystal ball, I remain hopeful that we, as a people and a nation, will finally face our problems and begin to reach for solutions—together—in one neighborhood, town, city and state after another.

My good friend Richard Gylgayton advised me to relax and read history over the holidays. There’s nothing like a good history book to give one a sense of perspective on things, for every collapse was followed by a transformation in society, and something new grew up to replace the old failed systems. In this case, the magnitude of the changes we are facing can be intimidating. The way we buy and sell things, the way we find and distribute food, the way we remain free to “move about the country” will all begin a painful metamorphosis. Everything about our lives will become leaner, but also more personal and value centered. Friends and family will become the real assets they have always been, and neighborliness will be back in vogue when hard times come through that open door. The result will be a simpler life for most Americans, a life lived for the sake of other loved ones, and not in the service of corporate profits. Many institutions will have to fail when Americans simply stop giving their dollars to them because they choose instead to give them to people they love. This will be a hidden grace in the year ahead, and the beginning of the transformation our society so desperately needs. So, while I deliver the bad news about the reality at the door, I remain ever hopeful that we will work all this through, with discovery, innovation, sharing, and the hard work of building a new America on the ashes of the old.

The Nabob Speaks!

What will happen to it in 2008, and what about all the other key fault lines that have been stressing the system of late? Call me “NostraJohnus,” but here’s what that ancient seer of all things gloomy and doomy, the Nattering Nabob, sees in his crystal ball for 2008.

Energy:

The energy sector remains the key underlying stress on the economy. In January of ’07 the NYMEX Light Crude price was just over $50/barrel. By November it pushed through $98, nearly doubling in just one year. While some analysts predict that prices will ease to the $70 level by mid year, I think crude will top the psychological $100 mark some time in 2008, and continue to put upward pressure on prices. (This is a no brainer. As soon as I penned that statement, the oil markets accommodated by kissing $100 oil on Jan 2nd, as stocks plunged in the worst first day trading session ever recorded. After retreating, it again hit $100 on February 18th and moved past $102 later that month by May it set a new high of $127.82, and then reached $138. in June). Whether oil goes higher or not will be more dependent on “above ground factors” than the realities underground in the wells. While it is true that most major oil fields are maturing rapidly, and in decline, a lot of production remains in the system—in fact, some feel we are now at “peak oil” the apex of oil production that will trend down each year in the future. 2007 did not match our 2006 production levels. Unless 2008 sees the Saudis open the tap as far as they can, 2008 will not match them either, so the peak oil clan will certainly have bragging rights. Current demand soaks up every drop coming out of the wells, because if it doesn’t come here to the US, there will be someone in China or India or Japan eager to take that barrel off the market.

And so, the Nabob’s predictions on oil and energy are: (And as these things come to pass I’ll append a note in blue after each prediction).

• Major oil fields will continue into decline, particularly Cantarell in Mexico but also Ghawar, Burgan and the North Sea fields will lose production. The loss of Mexican oil will be particularly hard for the US, as they are our #2 provider. And no major discoveries of new oil will offset production losses and depleting inventories. (On March 1st Pemex reported that Cantarell could decline by 18% this year, then later revised that figure in June to 30%).
• Oil will top the $100/barrel mark at some time in 2008, (as it already has), and push higher. (It reached $105.51 on March 5 and moved up to kiss $145 by June. As the financial crisis played out in Sept and Oct, oil fell again because of the credit freeze and forced deleveraging from hedge funds. With margin calls looming, investors pulling money from their funds, the hedge fund managers had one thing they could sell off easily for much needed funds--oil futures. This, coupled with a slightly slower demand, led to the oil price declines later in the year. Nothing about the “fundamentals” has changed.)
• Natural Gas and heating oil prices will increase for the typical consumer. (Wait until you see your December bill! In the northeast, customers are being shocked by rate increases over the previous year. You will note that consumer prices are always slow to fall, even if the barrel price goes down.)
• It will be more expensive to own and drive a car in 2008. (Standard & Poor’s, the world's foremost provider of independent credit ratings, reported that delinquencies of more than 60 days on car loans issued to borrowers with the best credit were up 20% in 2007.  And gasoline is twice as expensive than it was 16 months ago.)
• The US will continue to subvert the Chavez regime in Venezuela with an eye on recoverable oil contracts. (They are already freezing Venezuelan Assets as Exxon Mobile duels with Chavez, forcing him to threaten to stop shipping oil to the US in Feb or 08.)
• Nigeria will continue to destabilize and threaten large oil company operations in the Niger Delta. (The Brass refinery operation in the Niger delta was attacked by insurgents in late feb, causing a 50,000 bpd shortfall of oil production. This will continue).
• China and India will intensify competition of Middle Eastern oil, propping up and increasing demand, especially for diesel fuel.(China signed a lucrative gas development deal with Iran in late Feb. See why Bush is so eager for regime change there now? The Commies are booking the business while the capitalists waste their treasure on an endless war and go begging for handouts overseas.)
• The cost of electricity will increase. (When is the last time it decreased?)
• Energy costs will put upward pressure on prices in the US, particularly in food production and transportation. Food was up 22% in ‘07 and it will go higher.(And not just here. By April, ‘08 food riots were breaking out in Egypt, the sub Sahara and other Asian countries as basic commodities like rice, wheat, and corn skyrocketed in price.)
• Increasing costs will force consolidations and mergers in the airline industry. (Northwest and Delta began merger talks in Feb or 08 others will follow).
• “Free Shipping” will be a lost incentive as Internet companies pass on the pain to the buyers.

In general, the country will continue trying to live as it has, and accept the consequences of rising energy costs until they become so painful they will force change. In a recent national survey, nearly 60% of respondents indicated that higher energy costs for fuel and utilities are the principle reason why it is more difficult to meet their financial obligations. (Only 19% responded that their mortgage payment hikes were the cause), so energy costs are #1 in the public’s mind when they think of harder times ahead. Yet we have it very easy here with $3 gasoline, when Europeans pay close to $8 a gallon! 2008 will see more pain than change in this area, but that could be a good thing for the nation as a whole, because we so desperately need to develop an alternative sustainable energy model for the future. This crisis will see the beginning of real efforts in that direction, and signal the end of the corporate oil cartel domination of America. We really have only two choices here: 1) let the Army remain an oil protection service and fight for the fuel our society needs, with endless war, or 2) begin to scale back our life styles and build something new. I vote for #2

Other Above Ground Events:

• The quagmire of Iraq will linger on for another year, but if a Democrat is elected they will begin to bring  troops home—moreso to stop the hemorrhaging of the treasury than anything else. Case in point: The USAF asked for $137 billion to refurbish its war stressed aircraft. This is almost equal to the entire $150 billion “stimulus package” Bush thinks will rescue the failing economy. The war has been an immense drain on our economy, and simply must end. What in the world did we get for it? The satisfaction of seeing Saddam hang? And where’s the oil?
• Israel will launch a major operation against Hamas in the Gaza strip and continue to press for action vs Iran. They may get more than they bargain for in return. (After launching a series of “raids” to quell Qassam missile attacks, Israel has officially started “Operation Hot Winter” in Gaza as March came in like a lion.)
• The Neo-Cons will make one last attempt to force an attack on Iran. (There was already a reputed threat to three US ships in the Straits of Hormuz, and some odd sub-oceanic sabotage to communications cables. A lot of military maneuvering on both sides has gone on, but the financial crisis put the kibosh on Bush plans for Iran).
• A domestic terror incident will be used as a means of fanning the flames for war in the Middle East. (October surprise, anyone?)
• Pakistan, not Iran or Iraq, will be the big crisis area in the Middle East this year. (If Bhutto’s assassination is any lead, and Musharaff’s defeat in the election, the course for Pakistan is going to be rocky. Thousands are already fleeing into Afghanistan.)
• At least one major hurricane of Cat 3 or greater will strike the US in 2008. (Both New Orleans and Houston received direct hits, with Cat 3 damage nearly leveling Galveston with Hurricane Ike)
• Drought will persist in the West and Southeast.(Extreme drought continues over a 5 state area)
• There will be a major earthquake of 6.0 or greater in Southern California. (Not recorded)
• Bush will be clearing out his White House desk by year’s end and be regarded as the worst president in US history. The damage his “administration” has inflicted on the nation will take a decade or longer to set right. (This is a no brainer)
• There will not be a Clinton or Bush as President in the White House after Bush leaves office in 2009.  Can you say: “President Obama?”  (Yes, we can!)

Finance & Economy:

The big surprise for the boys in the banks this year was really no surprise at all. The game of writing fast loans, bundling them into securities, paying ratings firms to grade them high, and then pawning them off to investors and other institutions and municipalities has come to an end. The new game is to hide the losses incurred from these loans as long as possible, and keep them off the balance sheets. Banks and major finance houses like Merril Lynch, Morgan Stanley, Citibank and others have been announcing massive “writedowns” and then going to China, Singapore and the Gulf States, hat in hand, to try and re-capitalize. If these institutions had to account for all their activity on a genuine balance sheet, they would already be insolvent. And so I predict the pain will get a little deeper, spreading to other sectors of the lending markets and rippling through the economy as a whole in 2008.

We have already seen the effect of this during the recent 2007 holiday shopping season. Sales were sluggish, with large retailers like Macy’s down 15%. Tech performed well, apparel faltered. Apparently a new cell phone, video game or iPod replaced ties, socks and sweaters this year. The financial channels kept trying to paint a rosy picture of Christmas ‘07, harping on all the gift card dollars yet to be redeemed, but the fact of the matter was that the consumer has started to retrench, slowing discretionary spending as I predicted earlier in the face of rising costs for necessities—especially energy. 2008 will see more of the same. This was the last year the consumer will be able to afford extravagant luxury items. 2008 will see a struggle to simply provide basic necessities.

Restaurants, already off 26% to 30% in some markets, will find it more difficult to book reservations. The cost of a nice meal out for two can be as much as a week’s groceries in some establishments. People are realizing they just can’t afford to dine out. The same will be said of other middle class luxury behaviors. Day Spas, $5 cups of coffee, vanity services, nick-nack stores, and US tourism in general will decline in 2008. Retail in general will begin to decline, as big box builders like Wal-Mart, Target and others scale back new store builds for 2008. This decline will further stress the commercial real estate development sector, and job prospects will dim, with rising unemployment for 2008.

Dollar Blues

As the chart from StockCharts.com indicates above, the dollar took a pounding in 2007, weakening our purchasing power for all things imported, which is just about everything we buy these days. People often equate rising prices with inflation, but in real terms inflation is an expansion of credit and money supply. Price increases are just an effect of that expansion.  I’m inclined to think that inflation will not be the real enemy in 2008. In fact, the Fed, ECB and other large banking institutions are acting like they fear deflation more than anything.

Look at this quote from the head of the ECB after their unprecedented $500 billion liquidity injection: “We must try to avoid the vicious circle in which tighter liquidity conditions, lower asset values, impaired capital resources, reduced credit supply, and slower aggregate demand feed back on each other."  That is the very definition of a deflationary spiral, a problem that is much more difficult to cure and control than run-of-the -mill inflation. (It was deflation that chilled down the economy during the Great Depression, not its hot headed brother inflation). In an environment of deflation, the value of the dollar actually strengthens, and institutions accumulate cash. Credit tightens, lending slows, the velocity of money in the economy taking a big hit in the process. You fight deflation by easing interest rates and injecting liquidity—which is exactly what the central banks have been doing. Also, deflation is more characteristic of a depression than a recession. In short, the central banks are worried about more than two quarters of negative growth.

And so, the Nabob’s predictions on the economy and finance are:

• The Consumer Price Index will rise to at least 209.5 by May 08 as prices for many necessities continue upward. (January rose to 206.7 by May of 2008 it was 216.6)
• Credit markets will continue to tighten, further slowing the economy. (By March the credit crisis was deepening, and it will will get even worse in months ahead. By Sept the system itself was on the verge of collapse and a $700 billion bailout was being rushed through congress.)
• The housing market will continue to decline, with prices and equity eroding along with sales.(Sales figures continue to plummet, along with housing values.)
• Housing values will decline by at least another 30% before they stabilize.(They dropped 30% year over year in places like Southern California)
• Foreclosures will increase in spite of the Paulson Teaser Freezer plan. (March ‘08 saw them rise 57%)
• You will see lots of “get rich quick by buying foreclosed properties” shows on TV infomercials. (Have you been watching?)
• Banks will continue to report massive losses related to real estate CDOs and SIVs. (Bear Stearns: Kaput. Citigroup -$5.1 Billion, Merril Lynch: -$9.7 Billion etc.Absorbed by BofA,  Fannie & Freddy are about to deliver a $5 trillion bill to US taxpayers! AIG - Kaput.)
• The credit crunch will ripple through the commercial real estate sector, and then consumer credit.
• Delinquencies and defaults on credit cards will increase. (30 day late payments rose 26% in over previous year.)
• FICO scores will begin to erode all across the middle class and be rendered meaningless.
• Banks will attempt to retain capital, and obtain financing from foreign investors. (The Credit freeze is largely a voluntary act by banks refusing to lend to preserve their capital against anticipated losses.)
• Banks, including major US banks, will struggle to remain solvent. Some banks will fail.(IndyMac collapsed in Mid July, the 2nd largest bank failure in US history...soon to be dwarfed by the failure of WaMu on Sept 25th, which in turn was dwarfed by the failure of Wachovia a few weeks later.)
• There will be a depression style run on a US bank at some point in 2008. (As investors fled Bear Stearns in March, and capital eroded from $20 billion to a little over $3 billion in a matter of days, commentators described the landmark event as a “run on the bank.” IndyMac was swamped later in July. Depositors withdrew over $16 billion from WaMu in th elast 10 days before it failed. These “silent bank runs” continued until the Government raised the FDIC guarantee to $250,000 per account and started to backstop the major banks with cash infusions)
• Auto sales will continue to decline, as will consumer spending on the whole. (Sales are already off 18% to 24% and American auto companies have no small gas efficient cars which will be in high demand from this point forward to stimulate growth. The SUV is dead. US auto makers are again well behind events. GM stock fell under $10 a share on July 2nd, a 54 year low. The market cap of GM and Ford combined is now only a tad over $16 billion. Toyota’s market cap, by comparison,  is $148 billion. Merger talks between GM & Chrysler were revealed in October).
• Unemployment will increase, gathering real strength later in the year. (6.7% and climbing)
• Almost all of the above predictions are well underway, and will deepen as the year proceeds.
• The US will enter an official recession in 2008, which will be a long lasting event. US corporations hoping to make up for domestic losses with business overseas will be disappointed. The recession will spread to European markets as well, and even China will face a crisis brought on by overheated growth. (The crisis was proved to be “global” by September as major banks failed in Germany, Belgium, the UK, Iceland and numerous countries looked for help from the IMF.)
• The Stock market will suffer another 10% correction in the short term, (This has already happened as the market fell below 12,500 in early January), but it may lose as much as 30% of current stock values this year, if not more. (On March 10, the S&P was 30% off its high water mark before the Fed announced another $200 billion liquidity scheme to send markets upward again. The Dow and NASDAQ fell into official “Bear Market” territory on July 2nd, 20% below the highs of Oct 07 last year. In one week alone it plummeted another 16%. It was still looking for a bottom in late Oct, with swings of 500 points the norm now, like a car careening down a hill without brakes.)
• As hedge funds evaporate, all those boomers with 401K plans and other retirement options will see their golden years going up in smoke and begin to pull out dollars while they can. Funds will fail, freeze transactions, and the howl from hoodwinked “investors” will be heard round the globe. (Citibank and Morgan Stanley have already frozen funds to stop massive investor withdrawals. Hegde funds have been hammered, forcing them to deleverage.)
• A deflationary scenario will develop from the current financial crisis and reverse dollar value erosion—in fact, the late December rally in the dollar could be a strong indicator that deflation has begun as the velocity of money has been slowed to a crawl by the crisis of 2007. Deposits to savings and demand deposit accounts at banks have started a steep decline. Money is getting hard to come by and deflation will be the most serious threat in 2008. (This is well underway)

How to get ready for hard times ahead

If I am right and the real threat is a depression style deflationary spiral, and not an inflation scenario, then cash is king in 2008. The great enemy in this environment is debt. While I’m not a financial advisor, common sense leads one to think that the volatility we have seen in the stock market will continue in 2008. Unless you are an experienced and nimble trader, or can afford to hire one and dare risk your nest egg in the market, I would stay as far from Wall Street as possible. Again, in real terms, adjusted for the weaker dollar and inflation, stocks lost money in 2007. The average person has no business in such a market. They would be far better off by sinking every penny they have into retiring debt.

If you have a credit card with interest at 19.99% or higher, and a balance of $3000 or even $5000, why would you ever own a lick of stock? Why would you leave money in an investment plan that relied on the market going up? Instead,  liquidate it and retire those credit card balances ASAP. You have just made 20 % on your money by avoiding all that interest, about four times the advertised 5.2% “gain” of the S&P this year, which was really no gain at all, as I have argued above.

In a deflationary spiral, eliminate debt and build cash savings. If the dollar gets too volatile, then foreign currencies or gold will hedge your position well enough. No stocks, bonds or 401K plans? Can’t retire your credit balances because you can barely make your minimum payments? Then stop using the cards—period. Cut them up and rely entirely on your normal income for all expenses. This will, in effect, force you to live within your means, and get you out of the mindset that credit is real money, your money, and should be used to buy things. Nothing could be farther from the truth. Credit is simply debt—nothing more or less. In the hard times ahead, debt will be the killer of most households that falter and fail. Taking on debt is a bet that your financial future will be stronger next year than it is this year. If these predictions come true, this will not be the case.

Prepare for hard times by simplifying your life and scaling back your spending until it is within your means. If you are a three car family, scale back to one or two cars. Sell the others and throw the proceeds at any credit card debt you have. If you are thinking of buying a house, rent instead. A year from now you will be able to buy the same house for 20 to 30% less in some markets. (But even 5% less is worth the wait: i.e.) $17,500 less on a $350,000 home!) In California, for instance, a condo sold for $500,000 in 2006 and dropped to $400,000 by the end of 2007—a whopping 20% loss in value. If you had rented instead of buying that condo, you would have saved five times the annual rent of $2000/month just by not buying at the top of an overheated market. This gets at buyer psychology. We are accustomed to getting what we want immediately, by using other people’s money at 6 to 20% interest. Learn to wait and buy when the housing market bottoms out. It still has a considerable decline ahead for 2008. Buy in 2011, or later.

High medical costs? Get your doctor to prescribe generic drugs and pay less. Utilities through the roof? Roll back that thermometer and put on a sweater. (Jimmy Carter was right!) Ditch an expensive business land line and get a cheaper cell phone for client contacts. The rate beats most business land lines and the strong national coverage eliminates long distance charges as well. (Not to mention the convenience of having the phone with you when you need it.) Drop HBO and Showtime and scale back to basic cable. Better yet, read instead of watching TV. You’ll be amazed at the difference when you turn the boob tube off. (They didn’t hang that tag on the box for nothing.) Food costs breaking the budget? Use those coupons, buy specials, and buy in bulk. Scale back dining out, it will cost you a week’s groceries. Learn what a needle and thread is for instead of buying new clothes.

These obvious measures are just the first hole in the belt tightening process. As our lives get leaner, that belt will be pulled tighter as well. The bright side is that a simpler life is less complicated, less stressful, and saner in the long run. But in order to thrive in the harder times you need to first change your psychology. Stop giving your time and attention to the frivolous and often ludicrous things the corporate media broadcast at you each day. If enough people phoned in and told the networks to start putting on useful and informative programming, or they would ditch their cable TV, we might get change. Watch American Idol,  Survivor, the antics of Brittney Spears and her little sister, and the networks will spawn a host of “entertainment” programming based on that and ram it down your gullet 24 hours a day. TV is all about instilling a desire in you to buy something. Instead, why not take stock of the good things you already have, and say “thanks.” Then say “no thanks” to the nonsense on TV  and let the falling ratings work the change.

One day, corporate America will have to recognize and own responsibility for the drivel they manufacture and broadcast each year.  One day, perhaps not too far off,  our lives will again be so desperately needy that we will not be able to believe we ever bought into the nonsensical TV-O-Rama life that brought us “Flip That House” and other clever programming. What we will need is programs that teach us how to plant and harvest our own “Victory Garden” for food, how to purify water, home medical remedies, how to stretch the food dollar each month, where we can find firewood… You get my point. The days of wine and roses are over in America. Those hard times are now at our doorstep, and as Kunstler said, they are not happy with us.

2008 will be the year that illusion and delusion falls away, and reality steps in to begin the transformation of our lives. I have felt this strongly, both in my personal life and in the way I have viewed the world this last year. Many close friends have also experienced the transforming energy at work in the world. Things fall apart. The center cannot hold…but the silver lining is that they come back together as well, they become something new.

While the year ahead will be one where many of us feel we will have sustained a loss, the loss of property, of fortune, or even love; the adversity of an unfavorable circumstance, I am reminded of the Taoist Farmer, who looked at the world with “equal eyes” and simply pronounced: “Who knows what is good or bad?”

It was harvest time, but the farmer’s horse ran away. “How terrible that you suffer so,” said his neighbor, but the farmer simply looked at him and said: “Who knows what is good or bad?” The next day his horse returned, bringing two others it had met in the wild. Now the farmer had not one horse, but three, to bring in his crop. “How fortunate and blessed you are,” exclaimed his neighbor. But to this the farmer said again: “Who knows what is good or bad?” That afternoon his only son was trying to tame one of the new horses, and was thrown to the ground, breaking his leg. “Oh, misery and misfortune!” cried the neighbor. “Now how will you fare without your strong young son to stand by your side?” And of course the farmer replied with only one thing: “Who knows what is good or bad?” Was it prophecy or fate at work, for the very next day war came to the province, and the army called out every able bodied son, and took them away. The neighbor came weeping, having lost his son, but when he looked on the farmer, he said: “How fortunate! Your son has broken his leg and will remain here with you this hard winter…” but “Who knows what is good or bad?”

Things will happen this year, that much is certain. How we react to them will determine whether they seem good or bad to us. There is no good or bad, said Shakespeare, but thinking makes it so.

It may be hard to find hope in climate of adversity, when the markets tank with your real estate, while your credit card balances go through the roof.  Many a nest egg may be lost by year’s end, and long held beliefs in statements like “all real estate is local,” and “home values will always rise in this area” will be sorely challenged and put to rest, if they are not dead already. Hope may be a lost commodity in hard times, but we can reach for it here at the beginning by taking stock of all that we have and whispering a prayer of thanks for the good lives we still live in this country. We have at our beck and call an array of appliances that would have invoked the envy of kings and emperors of old. Even the least of us can walk about with a MotoRazr beaming videos into the ether, instantly connecting us to a network of friendly contacts, clients and friends. So give thanks as you watch the year unfold, and remember the things you do have now, in spite of any way you may feel yourself to be diminished by the events of 2008. Here is a poem that says it much better than the Nattering Nabob could, and I hope you will take it to heart.

Listen
with the night falling we are saying thank you
we are stopping on the bridges to bow from the railings
we are running out of the glass rooms
with our mouths full of food to look at the sky
and say thank you
we are standing by the water looking out
in different directions
back from a series of hospitals back from a mugging
after funerals we are saying thank you
after the news of the dead
whether or not we knew them we are saying thank you
looking up from tables we are saying thank you
in a culture up to its chin in shame
living in the stench it has chosen we are saying thank you
over telephones we are saying thank you
in doorways and in the backs of cars and in elevators
remembering wars and the police at the back door
and the beatings on stairs we are saying thank you
in the banks that use us we are saying thank you
with the crooks in office with the rich and fashionable
unchanged we go on saying thank you, thank you
with the animals dying around us
our lost feelings we are saying thank you
with the forests falling faster than the minutes
of our lives we are saying thank you
with the words going out like cells of a brain
with the cities growing over us like the earth
we are saying thank you faster and faster
with nobody listening we are saying thank you
we are saying thank you and waving
dark though it is

W.S.MERWIN

And many thanks to Mary Beth for handing me that poem!

Article By:
John Schettler – December 2007/January, 2008
 

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