2009

So what will 2009 hold for us? In these early days we have

1. Fed interest rates at close to zero.
2. Fighting in Gaza/Israel.
3. Somalian pirates still holding a tanker and a few ships.
4. The DJIA around 8600, the S&P around 900 and the Nasdaq around 1600.
5. Scandals that are still brewing from Madoff to the Illinois senate seat controversy.
6. Gas at around $1.60.
7. Anticipation on Obama's inauguration.
8. Money, job and home value worries.
9. Uncertainty about the economy - will it get worse or will it get better?
10. Ongoing conflicts in Iraq and Afghanistan.

A lot depends on whether a person is an optimist or a pessimist.
And a person's optimism or pessimism really depends on whether he has an income coming in and if he/she can make ends meet.

This feeble mind this that, that is the key to success in 2009. It includes

• Live within your means.
• Pay off all your debts including mortgage.
• Save a year's worth of living expenses. This should include estimated Cobra payments, home, car, flood, umbrella insurance, car and mortgage payments, school/activity fees for children, any estimated co-payments, food and clothing allowances and up to $10K as an emergency reserve on top of the other estimates. This is a tough goal and may not be achieved in one year but we need to get realistic on what a year's living expense really means.
• Hold on to you job in any way possible.
• Don't cave in to impulses small ( a new cellphone) or large ( a car or a pool).
• Stop looking at ads. You are not helping the economy by spending, you are only hurting yourself. The economy will find ways to adapt.

I guess the above proves that I have a pessimistic view, and to be honest I suppose I do. I am not overly so but just like companies tighten their fiscal policies and curtail spending in tough times, so should you.

I am however hoping that the year turns for the better

• That the economy stabilizes after the job losses and contraction.
• The middle class get some safety net that prevents them from going destitute after a illness or job loss.
• The government goes after hedge funds and regulates them better rather than imposing more burden on a regular business a-la Sarbanes-Oxley.
• The big 3 automakers produce vehicles that people buy for their mechanical merits rather than for patriotic reasons.
• We get some closure of a successful nature in our overseas military undertakings.
• We end the year with cautious optimism.

So...happy new year!