Wall St vs Main St: Economic Predictions for 2009

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As one year ends and another begins, the experts on Wall Street are falling all over themselves to predict the year ahead. But are those experts really any smarter than the average person on the street?

A couple of weeks ago we conducted our annual experiment by getting predictions from a high-profile economist and people like you. Let’s start with the stock market…

What’s going to happen in 09?

“We’re close to a bottom now, and I think we’ve probably hit the worse point already. That doesn’t mean we go straight up from here. But I still think by the end of the next year we’ll be up by 10, 15%.”
-David Wyss, Chief Economist Standard and Poors 

“I’d say the stock market will be a rise of 10%. At least. Minimum.”
-Main Street 

So we have agreement. Wall Street says 10% minimum, Main Street agrees. Now a toughie…

What’s going to happen to oil?

“Your guess is as good as mine. Right now we’ve got prices gradually moving back up to sort of a $90 range over the next couple of years.”
-David Wyss, Chief Economist Standard and Poors 

“90 to 100 a barrel.”
-Main Street 

Agreement again! Our expert says 90 bucks a barrel, and so does our person on the street. That’s more than twice today’s prices. And one final prediction…

What will happen to the price of a home?

“There’s a big inventory of unsold homes. I’m looking for another 10% drop in home prices by the end of next year.”
-David Wyss, Chief Economist Standard and Poors 

“I think housing is going to go down another 10% next year.”
-Main Street 

In the six years we’ve been getting these predictions, we’ve never had across the board, precise agreement from our expert and people on the street.

So if everyone’s right, gas prices should go up, our 401(k) should come back, and housing has a tough year ahead. Check back next January and we’ll who was right… 

See predictions made last year

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