Vindicated in 2008, Some Experts Foresee Gloomy '09

A few who called last year's calamities correctly see grim days ahead

By Clay Dillow, Newser Staff

Posted Jan 2, 2009 10:52 AM CST

(Newser) – Labeled overly pessimistic for years, a few Wall Street prognosticators became the oracles of 2008 by correctly predicting the unwinding of the global economy, the Wall Street Journal reports. The doomsayers correctly anticipated bank failures, stock market declines, and the housing market collapse of the second half of 2008. As for 2009, don’t expect things to get any rosier, they say.

Some of their 2008 predictions were less than perfect—one predicted the collapse of the US dollar—but they continue to foresee disaster in 2009. Treasury bonds are overpriced, the stock market still faces precipitous declines, and massive inflation and higher interest rates will scare away foreign investment while pushing consumers to save rather than spend. Oh, and the dollar is going to crash.

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He never even saw it coming. (AP Photo)

Stock markets may be in for a rough ride in 2009 according to a trio of traders who called 2008's declines successfully. (AP Photo/Apichart Weerawong)

Specialist Justin Bohan holds his head as he works at his post on the floor of the New York Stock Exchange, Thursday Oct. 9, 2008. It's not getting better anytime soon, according to some doomsayers. (AP Photo/Richard Drew)

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They will stop enabling us. They will stop buying our bonds, our currency, and the value of the dollar will drop precipitously.
- Peter Schiff, brokerage-house owner, on foreign nations buying US debt

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Vindicated in 2008, Some Experts Foresee Gloomy '09