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Jim Blasingame’s 2016 Crystal Ball Predictions

Here is the 16th edition of my New Year predictions.

· Wall Street’s digital greed, Washington’s anti-business policies and collusion between the two continue to create a moribund Main Street economic environment for small businesses.

· With a declining global economy and having exhausted financial manipulation options since 2008, capital markets will struggle in 2016.

· Main Street small businesses that are mature and established will fare well in 2016.

· Economic and regulatory pressures, plus demographic trends will perpetuate an unprecedented population decline in small businesses.

· New Crowdfunding rules lowering the standards for direct investment in small businesses will not become a funding silver bullet for this sector.

· Unlike its investor equity sibling, Crowdfunding lending will proliferate across the small business sector (especially with Generation Y) at the expense of traditional banks.

· Global headwinds, the specter of terrorism, seven years of anti-business policies from the Obama administration, and the unprecedented drama of presidential politics will all contribute to a flat 2016 economy, with annual GDP stuck below 2.5%.

· The perfect storm of a slowing global economy, a crude oil glut, newly approved exports from U.S. producers and OPEC’s loss of pricing power, will keep crude averaging below $50 per barrel.

· Slow global growth and deflationary threats will prevent the Fed from making more than one rate increase in 2016, if that.

· Due to the sustained price decline in crude oil, Putin and Iran will become more desperate and dangerous, using nationalism to distract citizens from their declining economies.

·  In an unprecedented response to ISIS, moderate Muslims around the globe will denounce intolerance and violence in the name of their religion in more actively claiming their role as the 21st century stewards of Islam.

· You will hear more about blockchains and distributed-ledger technology applications, disconnected from Bitcoin. This is very complicated stuff, but it’s the future of currency and capital management, so just start learning.

·  A mere shadow of its former self, Obamacare will continue to collapse under its own structural defects, causing the President’s namesake policy to go from legacy icon to caricature.

·  Already referred to by pundits as “the lawless president,” in his last year Obama will increase his assault on the Constitution with more unprecedented, and now desperate, executive actions.

· Obama’s newest Constitutional assault will be on the 2nd Amendment. Buckle up.

· Obama’s Justice Department will not indict Hillary Clinton in 2016, but as evidence of her lying achieves critical mass it will cost HRC Millennial votes, who value honesty over political ideology.

· The GOP primary process will not produce an apparent nominee going into their convention, unless it’s Trump or Cruz.

· Republicans will not win the White House unless the ticket includes a Hispanic and at least one person from Ohio and/or Florida. Look for Trump/Rubio or Cruz/Kasich.

· The social conservatism of Republicans and the socialistic economics of Democrats will create electoral challenges for both parties in 2016.

· If Trump wins the election, it will be because he’s the only candidate most likely to avoid defending the bankrupt elements of either party.

·  A liberal member of the Supreme Court will exit in 2016, probably in the first half.

· With every member of Generation Y, aka Millennials (80+ million born 1978-1998), old enough to vote in 2016, the electoral influence by this generation is now at critical mass.

· More than just a president, the 2016 election results will reveal the future trajectory of liberty and opportunity in America.

· Alabama will become the NCAA Football Division I Champion.

Write this on a rock …My 15-year record is almost 73% accuracy. Politics may put that average in jeopardy this year.

Jim Blasingame is author of the award-winning book, The Age of the Customer: Prepare for the Moment of Relevance.

Results of Blasingame’s 2015 Predictions and His Score

Here are my 2015 predictions and what happened. My prior 14-year record is 73% accuracy.

Prediction: Geopolitics, geo-competition and the supply/demand dynamic for crude oil won’t find equilibrium anytime soon, causing prices to fluctuate, but average less than $70 per barrel. Plus 1 - Crude averaged around $50 per barrel for the year

Prediction: With consumers buoyed by low gas prices and six years of recovery fatigue, the U.S. economy will grow, but global economic headwinds and currency influences on exports will result in U.S. annual GDP averaging below 3%. Plus 1 – Owing to a disastrous Q1, annual GDP is closer to 2%.

Prediction: Consumer optimism will produce small business contribution to GDP greater than any year since the Great Recession. Minus 1 – Incredibly, in the sixth post-recession year, consumers, the small business sector and economy are all going in the wrong direction.

Prediction: An improving economy, plus anticipation of a business-friendly 114th Congress will cause an upward trend in small business optimism toward NFIB Index’s 42-year average of 100 points. Minus 1 – NFIB Index reports trend was no better than flat.

Prediction: Small business loan demand will increase as growth opportunities exceed the ability to fund them with organic capital resources. Plus 1 – The increase came mostly from non-traditional sources, like asset-based lenders.

Prediction: With organizational productivity maxed out, even marginal economic growth will cause small and large businesses to increase hiring. Plus 1 – Hiring did increase. But exposing the irrelevance of U3, not enough to drop true unemployment to 5%.

Prediction: Continued concern about the fragility of the U.S. and global economies will cause the Fed to maintain monetary easing by keeping the Fed Funds rate unchanged. Plus 1 – I took a lot of heat on this from every economist I know – most predicted a June rate increase.

Prediction: In King v Burwell, Supreme Court will rule 5-4 that Obamacare was written to exclude subsidies to states with Federal exchanges. Minus 1 – In the Bizarro World of the Roberts’ Court a 6-3 majority contrived that “only” really means “every.”

Prediction: The GOP-controlled Congress and President Obama will agree on tax reform in 2015.  Plus 1 – Nothing sweeping, but year-end reforms will help small business.

Prediction: Congressional Republicans will thwart the execution of Obama’s executive order on immigration. Plus 1 – This happened, with help from the Courts.

Prediction: The Sony cyber-assault by North Korea will elevate corporate America cyber-security to a de facto national security level. Plus 1 – Corporate cyber-security spending increased by 20%.

Prediction: Unprecedented foreign state cyber-assault on a U.S. corporation will cause the government to stop companies from responding to such threats on their own. Plus 1 – These conversations did happen.

Prediction: In political theater redux, a Clinton and a Bush will become presidential candidates, but neither will be their party’s front-runners by year-end. Push – Got Bush, missed Clinton. Surprised Bush hasn’t done better and Clinton’s baggage hasn’t hurt her.

Prediction: Oregon will defeat Florida State in the Rose Bowl on New Year’s Day. Plus 1 – A 59-20 whuppin’.

Prediction: Alabama will win the inaugural NCAA Division I Championship Game Jan10. Minus 1 – My first ever football miss.

Write this on a rock …This year I went 11 for 16, or 69%, taking my 15-year record to 72.7%. How’d you do?

Results of my 2014 Crystal Ball Predictions

Here are the results of my 2014 predictions, what happened and my score.

Prediction: Five years after the Great Recession ended, the economy will average less than 3% growth. Actual: Although surging, 2014 GDP will be about 2.3%. Plus 1.

Prediction: Even with a slightly improved economy, small business (SB) optimism levels will still be below the NFIB Index’s 41-year average of 100 points. Actual: NFIB Index 2014 SB optimism is below 95 points. Unfortunately, plus 1.

Prediction: Continued uncertainty for the sixth straight year will make SBs reluctant to invest and borrow money. ActualNFIB Index shows small businesses loan demand and investing at record low levels. Plus 1.

Prediction: Uncertainty about Obamacare’s impact will cause SBs to continue hiring reluctance. Actual: NFIB and other surveys shows SB hiring still negligible. Plus 1.

Prediction: Obamacare will continue to be an economic headwind in 2014. Actual: Owners and managers continue to identify Obamacare as a significant negative factor in business decisions. Plus 1.

Prediction: More significant than the media favorite U3 unemployment rate, the employment participation rate, currently 63%, will remain at a 38-year (Carter) record low. Actual: Current labor participation is 62.8%. Plus 1.

Photo by Garry Knight on Flickr.com

Photo by Garry Knight on Flickr.com


Prediction: The Fed will discontinue unprecedented quantitative easing (QE) that infused trillions of dollars into Wall Street since 2008 without benefiting Main Street. Actual: Fed ended QE in October. Plus 1.

Prediction: A combination of disruptions will produce a challenging year for Wall StreetActual: Nothing seems to impede the madness of Wall Street crowds. Can you say bubble? Minus 1.

Prediction: Obamacare’s constitutionality will be challenged by many lawsuits. Actual: Currently 104 lawsuits have been filed against Obamacare, including one before the Supreme Court. Plus 1.

Prediction: Democrats running for re-election in 2014 will run from the president. Actual: No Democrat wanted Mr. Obama anywhere near their campaign, but it still didn’t help. Plus 1.

Prediction: The GOP will regain control of the Senate and maintain a majority in the House in November. Actual: Republicans swept almost everything, from the Senator down to dog catcher at the local level. Plus 1.

Prediction: President Obama will prevail on immigration but will lose on minimum wage. Actual: Immigration win by Obama’s executive order but no minimum wage increase. Plus 1.

Prediction: Hillary Clinton will not announce her 2016 presidential intentions before the mid-term elections. Actual: Everyone knows she’s running; she just hasn’t announced yet. Plus 1.

Prediction: Auburn will defeat Florida State in the BCS Championship Game. Actual: Great game, but the Noles won 34-31. Minus 1.

Write this on a rock …

This year I’m 12 for 14, or 86%, taking my 14-year record to 73% (’08 was a rough year).

Jim Blasingame is author of the award-winning book, The Age of the Customer: Prepare for the Moment of Relevance.

Blasingame’s 2011 crystal ball predictions

Here are my predictions for 2011.

Prediction: Small business optimism will improve in 2011, following recent record lows (based on 37 years of tracking by NFIB’s Dr. Bill Dunkelberg). This will result from less uncertainty about taxes, less anti-business rhetoric from Washington and an improving economy.

Prediction: For the first time since 2008, small businesses will report increased sales and profits for 2011.

Prediction: Small business recovery will not translate to significant job creation due to newly acquired aversion to adding permanent payroll expense, plus technologies that improve the conversion of capital to sales and profits.

Prediction: Stubborn structural unemployment will result in a national jobless rate above 8.5% at year-end.

Prediction: The U.S. economy will grow at a rate of over 3% GDP for 2011.

Prediction: As the global economy recovers, demand for commodities will rise, putting upward pressure on prices, especially petroleum. Budget – and/or hedge – accordingly.

Prediction: Global inflation will begin to manifest as an economic recovery headwind for markets and sovereign nations.

Prediction: The disconnection between what’s good for Wall Street and what’s good for the Main Street economy will become more evident than ever before.

Prediction: President Obama’s approval rating will improve by year-end - currently -2.3% (45.6% positive minus 47.9% negative).

Prediction: Congress’ performance approval with improve by year-end - currently -54.4% (19.6% positive, minus 74.0% negative).

Prediction: Vice President Joe Biden will announce his retirement from politics effective at the end of Obama’s first term.

Prediction: At once controversial and compelling, Newt Gingrich’s presidential candidacy will lead all Republican polls by year-end.

Prediction: A better power-broker than viable candidate, Sarah Palin will not run for president.

Prediction: As sunlight is shined on the financial and regulatory realities of “Obama-Care,” it will transmogrify from President Obama’s greatest policy accomplishment to a political albatross.

Prediction: Auburn will embarrass Oregon in the Tostitos BCS National Championship Game on January 10.

We continue to live the Chinese curse: “May you live in interesting times.”

Jim Blasingame makes three predictions for 2011

Jim’s economic predictions for 2011

Jim’s 2011 political predictions

Blasingame’s 2010 prediction results

Here are my 2010 predictions from last January 3rd, followed by what happened and my score.

Prediction: U.S. GDP will be between 2% - 3%.
Actual: Year-to-date GDP is 2.23%. Plus 1.

Prediction: This recovery will not be good for start-ups.
Actual: July 2010 Business Week headline: “Start-up activity at record low.” Plus 1.

Prediction: Growing small business loan demand will signal Main Street recovery.
Actual: The NFIB Small Business Survey reported weak loan demand throughout 2010. Minus 1.

Prediction: 2010 will not see large banks returning to small business lending.
Actual:  Weak demand and their own financial problems caused this to come to pass. Plus 1.

Prediction: The housing industry will continue to challenge the recovery.
Actual:  Foreclosures are up national median home price is down. Plus 1.

Prediction: The second jobless recovery in a decade will keep unemployment above 9%. 
Actual: Through November 2010, U.S. unemployment was 9.8%. Plus 1.

Prediction: A new aversion to debt will stunt economic growth.
Actual: De-leveraging – a global phenomenon for individuals, companies and sovereign nations – has become one of the iconic residuals of the Great Recession. Plus 1.

Prediction: U.S. stock markets will not advance on merely cost cutting and without market performance.
Actual: Wall Street gains have defied my logic, but sadly, these gains are being paid for by millions of unemployed Americans. Minus 1.

Prediction: Health care “reform” legislation will be signed into law along party lines.
Actual: On March 23, President Obama signed the Patient Protection and Affordable Care Act without one Republican vote. Plus 1.

Prediction: Election-year realities will cause Democrats to forsake pro-union and cap-and-trade legislation.
Actual: Neither issue was a serious legislative threat in 2010. Plus 1.

Prediction: Republicans will increase seats in both houses without gaining control of either but will win a filibuster minority in the Senate.
Actual: Got three out of four, thanks to the Tea Party. We’ll call this a push.

Prediction: The federal government will keep California out of bankruptcy. New York will follow.
Actual: Like the 2009 General Motors bankruptcy I predicted in 2006, this cake just has to bake a little longer. Minus 1.

Final 2010 score: 8 right, 3 wrong, one push, putting my 10-year accuracy at 70.2%. How did you do?

Recently, I discussed my 2010 predictions and results on my radio program, The Small Business Advocate Show. Please take a few minutes to listen, and, as always, leave your comments.

Recapping Jim’s 2010 predictions for start-ups and GDP

Recapping Jim’s 2010 predictions: unemployment, lending, etc.

Jim recaps his 2010 predictions on politics and Wall Street

Blasingame’s 2009 Small Business Advocate Crystal Ball Predictions

Here are my 2009 Small Business Advocate Crystal Ball Predictions, which were first published in my free weekly Small Business Advocate Newsletter over the weekend, as well as in my newspaper syndication.

Prediction: Most financial damage in 2008 accrued to Wall Street and its stakeholders. In 2009, Main Street and small businesses will take the hit, especially in the first half.

Prediction: Economic recovery on Main Street will begin in the second half of 2009.

Prediction: Small business start-ups will be down because their initial capital comes from personal credit, which is now at unprecedented low levels.

Prediction: Small businesses that will have the most difficulty in 2009 will be retailers and sellers of big-ticket items that rely heavily on consumer credit.

Prediction: The Obama administration will produce a successful small business economic relief plan of loan guarantees and hiring tax credits.

Prediction: Independent community banks will thrive for two reasons: 1) They’re the lender-of-choice for small businesses that need local consideration; 2) Depositors will see them as more attractive than continually merging large banks.

Prediction: The Obama administration will continue the unprecedented government intervention in the economy, but positive impact will not occur until the second half of 2009.

Prediction: The Obama administration will shelve plans for the Employee Free Choice Act – designed to increase union organization – until 2010, when the economy will be recovering.

Prediction: Similarly, the Obama administration will shelve plans to pass a “cap-and-trade” bill – an attempt to regulate carbon – until 2010.

Prediction: The Obama administration will not recommend any tax increases.

Prediction: The Obama administration will justify moving forward with national healthcare reform in 2009, calling it part of economic recovery.

Prediction: The Obama administration’s attempt to create infrastructure jobs will fail.

Prediction: Comedian, Al Franken, will be the next Senator from Minnesota, leaving the Democrats one Senate Republican defector away from unfettered control of the government.

Prediction: With a justified concern for “stagflation,” the Fed will begin nudging interest rates up in Q4.

Prediction: Despite OPEC’s best efforts, oil prices will average below $65 per barrel, due to demand destruction.

Prediction: With their political leverage dependent upon petroleum revenue, 2009 will not be a good year for Putin, Chavez and Ahmadinejad.

Prediction: As the marketplace pays for the financial meltdown created by greed, corruption and incompetence, greater emphasis on transparency and accountability will be demanded by all stakeholders.

Prediction: Wall Street and the federal government created most of our current economic problems, but it will be Main Street small businesses that will lead the economy to recovery.

Final Prediction: In 2009 we will continue to live the Chinese curse: “May you live in interesting times.”

I talked about many of these predictions, and the reasons behind them, on my small business radio program, The Small Business Advocate Show. Take a few minutes to listen and of course, I would very much like to hear your thoughts.




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