What Sort of Year Are We in For?

7 January 2008

2 minute read

Will 2008 resemble the gloomy last six months of 2007? Or will it be more like the buoyant first half?

The credit crunch is finally having a visible impact on Main Street as well as Wall Street. That's shown by December's spike in the national jobless rate accompanied by the weakest month of job creation since 2003. Economic gurus like Martin Feldstein (president of the National Bureau of Economic Research) and top bond investor Bill Gross predict the U.S. is headed for recession, if it's not in one already.

However, eFC users who answered our latest poll question - "2008 will be...." - came off as more sanguine. Perhaps surprisingly, the most frequent of five possible responses was: "better than people expect." It was chosen by 30.7 percent of respondents. To be sure, "a dismal year" came in a close second, with 27.2 percent.

Two other choices, which mirrored the first two from a career perspective, drew slightly more optimists than pessimists. Some 12.9 percent pegged 2008 as "a good time to seek a new job" - an answer that presumes opportunities will be plentiful. Slightly fewer, 12.5 percent, called it "a good time to seek a new career" - likely signaling pessimism about opportunities within finance.

The final possibility, the rather non-committal "quieter than 2007," was picked by 16.7 percent of our users.

What do you think? Are headline writers overdoing the gloom-and-doom scenario? Or is 2008 going to make the concluding months of 2007 look like a picnic in the park? Post your thoughts below.

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Insider Comment

2 comments

Do
Doug
5 March 2008
It all comes down to momentum... if you lost it CDOs ABS etc. things will get worse before they get better, but all of those write downs will prop up as profits, it's a matter of when and for whom. If you can afford to hold these securities have an intrinsic worth above what they can be sold for and those with cash and time can scoop up some easy money. However it seems like few have cash and this is a business measured in heartbeats not weeks and months. For the areas where things were going well they will be fairly resilient hiring and growing as they did before "the guys downstairs" lost the farm.
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Anonymous
18 January 2008
There are still plenty of firms hiring and actually growing in the current economy. Certain sectors have been hard hit, but others are still very robust. This is the time when the idiom "It takes money to make money" truly applies. Look at all of the opportunisitic and middle market debt shops that are sprouting up and taking advantage of buying distressed debt at deep discounts. It's not all doom and gloom right now.
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