New Years Predictions for 2002

FTLComm - Tisdale - Monday, December 31, 2001

The traditions of making New Years predictions is something that goes back a very long way for me. As a school principal I always sent out newsletters, usually about twenty-two each school year but the most important one was at the end of the year when I would construct my new years predictions. So in the past three years of Ensign I have resumed this process and shared with you what I think may or may not happen in the coming year. Just in case you want to look back and see what was said in years past click on the year to see the predictions for that year. 1998 1999 2000 new century 2001 I have always made these predictions with the idea that it is interesting to consider what might happen and this past September I was shocked to discover that I had been far to close to the real world when in my considerations of the new century I pointed out the imminent conflict that was certain to take place between the Western world and the Islamic countries of the Middle East. In this preamble I want to just consider for a moment that there is no psychic power at work and no magical crystal ball. What we each have is our perception of this world and we can see things developing and from that, rationally predict that some events and trends might develop. When at this time last year I considered the steady decline in civilised behaviour by the Taliban in Afghanistan and the continued support by America of dictatorships in the region, it was completely obvious that conflict would occur. But it was not clear what form that conflict would take and never in my wildest dreams did I visualise the use of passenger aircraft being used as missiles. That horror is going to live on with us for a very long time. Now let’s get our minds around some of the things that await us in the year 2002. 1. There is a serious financial crisis brewing, all the signs are there and it will depend on some minor details as to what sort of ramifications this crisis will produce. The world is faced with a distinct financial problem that is contributed to because of the improvements in communications. Investors worldwide want to protect their capital and move it around the world at the speed of light. One of the safe havens for capital has been to rest that money in United States dollars. This practice has created an artificial value in American currency so that it may right now be trading at more that twice its actual worth. The United States is a net importer with a massive and growing trade deficit, when these to things are combined with the United States’ practice of flooding its financial market with treasury bonds, thus encouraging excessive borrowing and spending the combination is decidedly approaching that level where it may no longer be viable. The issue is, will this collapse occur in 2002 or will it be postponed? I predict that the postponement of this financial tumble has already occurred and that a level of sensibility will strike the world investment community in the second quarter. There will be a flight from American dollars beginning in June then building momentum in the summer so that in early September the core of the world’s finances, the New York stock exchange will tumble.

This tumble will not be like the 1929 crash but be less dramatic as American political and foreign policy attitudes will be considered the cause of the decline without the realisation that the problem was rooted in more than a decade of unsecured and unsustainable financial growth based on nothing more than attitude and bluster. The date to watch is Wednesday, September 4.

2. Canadian politics is in for some interesting times in 2002 as Ontario gets a new premier, the Canadian Alliance holds their leadership affair and the Liberal party is forced to consider the future. Ontario’s choice for a new leader to succeed the dim-witted Mike Harris is vital to all of Canada. By far the government of Ontario is many times more important to the business of the nation than the leadership of the Canadian Alliance and following true to form it is all going to come down to money. The Ontario conservative party leadership and the premiership are up for sale. The candidate with the most resources is certain to win and that will be that. All pretences with regard to democracy and altruism will go out the window; money and power, nothing more and a whole lot less. Oddly enough the Alliance’s leadership competition will only catch the interest of the national press but since that no longer is anything more than the whims of Izzy Asper you and the rest of the country will pay little if any attention. The public will deem the race, as “fixed” and the lack of validity by news reporting will deflate the whole process. It may seem like I am hedging on picking a winner but the reality is that it doesn’t matter. The Canadian Alliance is a whisper of the past it has no credibility and absolutely no future. The real political war of 2002 is in the executive of the Liberal party. Jean Chretien is and will remain the most popular Liberal for as far as can be predicted. It is up to Alin Chretien to decide when and if a new leader will be needed. She created Jean and when she has decided she and he have had enough that will be that, but until then the man commands. However, Paul Martin and the war chest he has assembled recognises that time is slipping by and his time with it. This will mean that in the spring the Martin supporters will stage serious internal conflicts in the party and be flattened by the Quebec component of the party. Allan Rock and Brian Tobin will gracefully avoid the fighting and nothing will have changed by this time next year.

3. Oil and Energy: The bouncing price of petroleum is related to an eighteen-month lag time from production changes to delivery. While at the same time demand is controlled by the economy. The price of gasoline and crude is almost bottomless. Even with severe reduction in production the glut will continue to mount and the retail price will descend until it will be well below production. A lot of oil companies depending on production from high cost exploration can expect to be written off this year. However, merger mania will grip the industry as dwindling profits and rising costs will see the majors scrambling to using takeovers to try and hold on, but this is just shear folly. The oil companies that stay the course and glide through the next fifteen months of depression will be just fine.

Alberta, which has constructed its economy on oil revenue, will move into the “have-not” category of provincial governments. With the attitude of the Alberta voter so Americanised this will mean really tough times in that province as taxes rise, services are drastically cut and Medicare will all but disappear. Now for the odd part. The high gasoline and electrical prices of the summer of 2001 have remarkably long lasting results as auto makers have already set their sights on producing fuel efficient vehicles and the first of the new generation of these hit the market in the fall of 2002. Though the target is 80 miles to a US gallon they are going to be successful with a whole bunch of vehicles doing 60 miles to a US gallon. The power outages and shortages in California this year have turned around the thoughts of consumers with serious development in alternative energy sources really kicking in during 2002. Nuclear is no longer a bad word and everyone will be looking for green solutions to electrical energy. SaskPower’s increase in rates for no apparent reason have signalled to the public that its time to find “do-it-yourself” solutions and the demand for power in Saskatchewan will decline in 2002.

4. Agriculture:

We have to start locally and work our way out of this. 2002 is dependent upon the sky and the Pacific Ocean. If there is snow and spring rain than the marginal farmers of this part of the province will stay in business. This is the break year for the farmer with grain production only and less than four sections under crop. If there is no rain he / she, will have to sell, with moisture and warm temperatures they will hang on for another year, maybe more. The big producers (seven sections under crop or more) can cruise through this year regardless of moisture. If growing conditions are good they will simply consolidate their debts, if growing conditions are poor they will increase their debt and acquire at dirt-cheap prices the dying marginal farms around them. Wheat prices are going to continue the trend toward improved prices. The crunch in the United States economy is going to put a major crimp on subsidies to the Kansas producer and they may even have to compete in the market fairly this crop year. In any case if you are growing wheat in 2002 it will pay the bills. Barley and oats are both looking fair as they continue to gain momentum in the domestic market while canola, which is facing head to head against soy and corn, is not expected to show more than moderate improvement. Cattle producers are clinging to hope that rain will give them pasture improvement and hay and in Saskatchewan in 2002 their prayers are being answered with the exception of the Cypress area which is now officially a desert. The price of beef is likely to suffer a modest decline until caving time and should be steady to improve this summer. Pork demand is and will remain high for the whole year. The economic decline in the US will have little effect on meat prices.

5. Credibility Gap:

The bombastic rhetoric of the Bush administration has already become tedious and in the coming months will move from dreary to repugnant. 2002 is an election year and half the states in the union will be selecting Governors and half of the Senate in Washington comes up for election. The question is, will any of those elected be Republican? Unfortunately Jed and George just don’t have enough brothers to fix more than a few elections and 2002 is a bad year to be a Republican. Few will be elected as the voter sees through the stupidity of their non-elected president. This lack of confidence will be on a personal level and will not effect the US’s war on terrorism. September 11 hit home and the public of the United States are going to demand dead Arabs and are perfectly prepared to see dead sons and daughters in the process. The resolve to seek out and redirect their vengeance will not be satisfied as 2002 is just one of the many “war years”. Like the European conflicts of the eighteenth and nineteenth centuries wars resembling on going hostile conflicts, the war against terrorism will be a feature of the first ten years of the century. Without settlement in Israel no peace can take place anywhere in the region but the Americans are pre-occupied with settling old scores they have not yet reached the conclusion that the real enemy is themselves. The attacks of September 11 occurred within their own country by either people trained in their own country or by their close allies, the Saudis. The Anthrax attack was carried out on Americans by Americans. During 2002 they will launch air attacks on Iraq and suffer addition attacks at home. Unable to recognise their true enemies, Pakistan and Saudi Arabia they will lash out at Somalia and continue their ridiculous impotence. The American public will demand more bloodthirsty action and the military will comply while Bush will continue to serve as a mouthy incompetent, dishing out rhetoric and unfocused rage. The attacks on the United States will continue from headquarters in Pakistan and with funding from Saudi Arabia. The United States will not abandon Israel but will increasingly be annoyed with its determination to exist not realising the link between the war on terrorism and the continued fanatical attempts to kill Israelis by the Palestinians. If Sharon is assassinated Israel will move to an all out war, not just on the Palestinians, but will breach the Sinai taking a swipe at Egypt and marching out into the desert for the first time against its real enemy, Saudi Arabia.

6. Pendulum Swing:

The world, East, West, North and South, is well entrenched in the gospel according to America. Doubts are already present as we see that American style old West shoot from the hip freedom for the rich and powerful just doesn’t work in Russia. China has already marked off a pragmatic blend of socialism, technocracy and restricted mercantilism that seems to be working. The so often quoted phrase that the United States is the world’s most powerful country is wrong. It is also wrong to even suggest that the American way of life is the right way for all people in the world to live. The most powerful country in the world is and always has been China. The best way for people to live is their “own” way. Once you grasp the importance of these two elements you realise that much of what will happen is far less violent than could be the case. Common sense in the world outside of the shouting and silly city of Washington, understands these two facts of life and in 2002 we will look aside from the American extreme as societies everywhere begin to build upon their very own strength. Japan, Korea and China have and will continue to lead the way in the world toward simple success.

7. Black Flag:

The unsettling and profoundly disturbing sceptre of India and Pakistan squaring off with Nukes is not going to happen. They may reach for their guns but I am convinced that neither is stupid enough to draw. However, citizens of the planet earth, if Pakistan or India launches nuclear weapons against one another there would be no avoiding the whole world being drawn into a world war. Sides would be drawn up and that would be that. The United States would fall in with Pakistan but China would side with India. Russia would in all likelihood try to remain neutral in such a conflict, as would Britain and in the end, we would bow to American pressure. I do not see this scenario-taking place, but we are certainly closer to the edge than ever before.

Well friends that is what I am predicting for 2002, a little less specific than other years but then I am older, though not wiser and this year the economy is the number one story, hold on tight it is going to be a rough ride.

To each of you I wish you a very Happy New Year. It is up to you to make the best of what ever comes your way. Timothy W. Shire