I Bet My Blog on a 2018 Economic Collapse — 2018 Economic Predictions


by David Haggith, The Great Recession Blog:

My 2018 economic predictions follow through on the accurate predictions I made in 2017. In my last article, I stated that I had bet my blog the stock market would crash by January 2018. In fact, however, I’ve gone back and rechecked those predictions and my bet, and I found that I wisely hedged my bet in terms of timing due to the Trump factor. I decided back then that, for the short term (2017-2018), Trump would seriously alter the economic trajectory of the US established during the Obama years — the path by which I was used to making predictions. He would not, however, improve things over the long term because our underlying economic woes would only get worse.

I made my promise when a naysayer challenged my 2017 economic predictions, which turned out much better than memory served now that I’ve gone back and actually reviewed them.

The Naysayer asked,

What if no Apocalypse happens in 2017 and even 2018? Promise to us that you will publicly apologise and admit that you scribbled tons of outrageous BS.

… and I promised in reply,

I will promise it right here and will ask you to earmark mid 2018 to come back to this page and hold me to it…. I’ll very likely do far more than apologize: I will likely apologize and stop writing this blog well before the end of 2018 if an economic apocalypse — the Epocalypse — is not clearly happening by then. (“The Inevitability of Economic Collapse” written in February 2017.)

I actually only promised to apologize if I was wrong, but I did not promise to quit writing my blog; and I gave a deadline of mid 2018, not the start of 2018. (Though I believed things would begin to fall part badly in 2017, I gave myself a buffer before I’d go so far as to apologize for being wrong because of my anticipated Trump Effect.) I did say I would likely even go as far as to stop writing the blog before the end of 2018 if I was still wrong. (The “probably” is because it depends on how far wrong I am. If I am only wrong by a few months and the economy is clearly disintegrating in the late fall of this year, I’ll probably keep writing.)

While I thought to myself at the time that economy would probably fall badly apart by January of 2018, my article stopped short of predicting that; and it did not predict the stock market would crash at all. I only wrote that economic fundamentals would get much worse, and almost all of those that I outlined have gotten worse. I even wrote in another comment to my two prediction articles that the stock market would rise for quite awhile if the president’s promise of a grand tax plan got passed in its promised form by congress:

The Trump plan is, indeed, massive; and, if congress passes it, there is bound to be a lot of short-term lift. If congress doesn’t pass much of a plan, on the other hand, the stock market has banked on it already, so it will fall quickly. Trump’s plan in my opinion is largely short-term medicine that is long-term poison. Stocks could really shoot up if all this corporate money gets repatriated to support buybacks or payoff of debt used for earlier buybacks and if corporations wind up getting a retroactive tax break.

As fast as the market rose speculating on the hopes of that tax plan, it has risen remarkably faster now that the tax promise is a tax fact and now that corporations get to retroactively repatriate past earnings at a better rate than they would have paid if they brought those earnings home in the years when they were earned. So, that prediction proved true. In fact, what I had actually predicted in that article last February was …

Exactly when [economic collapse will happen] I’m not as certain because the election [cycle] changed things…. So for the very short term Trump’s policies may boost the economy, but mid-term and longer, Trump and his cabinetful of bankster-barons are not going to be able to stop these numerous trends from crushing us. Trump has expressed no plans to solve any of these overwhelming structural flaws that are trending against us…. So, the situation toward the latter part of this year looks worse socially [a reference to the political animosity I had said was going to grow all year in 2017] and, in years to come, looks much worse financially and socially.

I gave myself more latitude in timing than I recalled giving, even saying that, because of Trump, the financial failings wouldn’t come until future years. In a follow-up article last February that laid out more of my predictions, I even said that it was “certain Trump’s tax plan will happen … in spite of the fact that “we have NEVER made tax cuts without increasing the federal deficit under any president.”

I even predicted,

The stock market will rise … for awhile, at least. What we know from trickle-down economics is that it certainly does stimulate the stock market. The money that is saved on capital gains and corporate income and that is repatriated in corporate income from overseas largely goes into speculative gambling in stocks.

and …

It is unlikely that Trump’s infrastructure stimulus plan will make it off the ground in 2017.

and …

Spending will certainly increase in one area — the military.

and …

Regulatory changes will also lubricate the economy to move forward with less friction.

and that the establishment …

will do anything they can to restrain Trump’s plans to drain the swamp in Washington and as well as his plans to align with Russia and his plans to diminish nation-building efforts.

At which I meant they would likely be successful.

All of those things proved true. So, when I actually went back this month and reread the predictions I had made in those two articles early last year, I found I had nothing to be ashamed of so far.

A complete list of my 2017 economic predictions

Here in bullet form are all the forces and events I predicted for 2017 during the first quarter of last year so you can assess accuracy for yourself:

  • Trump’s tax plan —  a third (and”trumped up”) round of trickle-down economics — would certainly pass in 2017. His enormous tax changes made it harder to for me predict the movement of money in 2017 because his tax plan is vastly different than all preceding years. Trump’s changes would succeed in moving massive amounts of money back into the US. .
  • Under his plan income gaps between the rich and all the rest would increase in the years to come (yet to be seen), leading to more class warfare in years down the road.
  • Trump would fully continue the immoral game of spending the next generation’s money to fund our own generation’s hope for recovery, wants and desires; but the plan would not resolve any underlying problems our economy has and eventually will worsen those problems, such as our massive national debt (which already places a half-a-trillion-dollar debt-service strain on the economy each year even at record low interest), leaving future generations with even worse problems than we have already established for them.
  • There would be some profit-taking from the Trump rally near the end of January, 2017, that would cause a likely “Trump slump” in the stock market but not an immediate crash. (A gradual slump did happen in the rally, declining for two months in March and April, after which the market picked up steam again.)
  • A 2017 stock market crash later in the year seemed likely but the likelihood would be mitigated by Trump’s huge changes, which assure the market would rise for a good part of 2017 after the slump. Trumphoria would likely lose steam in 2017. (Clearly, the market did not crash, however, nor Trumphoria did wane.)
  • Trump’s infrastructure stimulus plans would not happen in 2017, but military spending definitely would increase.
  • US nation-building would continue throughout 2017, in spite of Trump’s promises to move away from all of our military experiments.
  • Globalists would succeed in restraining Trump’s plan to realign with Russia, which he had said he would like to do during his campaign.
  • The forces that oppose Trump would not retreat, assuring that 2017 would be a remarkably chaotic year in which globalists dig in and fight. 2017 would be the year in which “the unstoppable force meets the immovable object.”
  • Spreading chaos and social unrest would increase throughout the world. (When do we not have that? My point, however, was that the tensions from the election would make it worse; but that didn’t turn out as badly as I thought it would.)
  • Hillary would not be going to jail in 2017 — not even close — in spite of all of Trump’s campaign cajoling that indicated he would sure she does.
  • Bailed out banksters would not be going to jail either under Trump any more than they did under Obama, so they would continue to be moral hazards as much under Trump as ever — if not more because he was giving them his choice cabinet positions.
  • Too-big-to-fail banks would just keep getting bigger (an underlying problem that would only get worse), and Trump’s deregulation of them (by undermining Dodd-Frank) would only exacerbate their destructive potential over a long period of time, but Trump’s deregulation would accelerate the economy as certainly as deregulation did before 2008.
  • Trump would not in any way change the globalist makeup of any of the world’s banks nor their path. (He would not even attempt to.) Therefore, the Fed’s manipulation of the stock market (and really any market it wants to manipulate) would remain unchecked under Trump (in spite of his campaign threats against Yellen and the Fed, which would all fade into empty rhetoric, intended only to stimulate his base).
  • The housing bubble would continue to get more bubblicious, but a decline would become obvious in certain areas in the summer. A collapse greater than we saw in 2007-2009 “might” start as early as 2017 in various parts of the world, including the US, but particularly in Canada and Australia and the UK as well as New Zealand and Sweden.
  • The above trends, along with aging demographics and rising interest on the national debt, would continue to worsen and will remain the forces that determine our long-term trajectory, which is toward economic collapse (as Trump would do nothing to improve any of them and will make most of those problems worse, assuring long-term decline).
  • However, for a short time, we would see a burst of economic improvement. (2017 and the first half of 2018 being that short time, after which I expect to see a reversion to the overall trend of decline caused by the forces delineated above, made worse by Trump’s plans).
  • Economic collapse would probably become evident by the end of of 2017 (and that is where I hedged my bet in terms of what I actually promised by giving myself until mid 2018 if I was going to make a public apology for being wrong).
  • Globalist banksters might even collapse the economy on purpose just so they could use Trump as the scapegoat for their failed economy. (Cleary didn’t happen, but maybe that is because, as predicted above, Trump did nothing to challenge them in any way; but left them fully in power, gave them cabinet positions, and gave them all enormous tax breaks.)


Those predictions, if anyone wants to check out that I have covered them all, come from the following articles:

2017 Stock Market Predictions: Trump Slump in January for Stocks

If 2016 Wasn’t the Epocalypse, What the Heck Was it?

The Inevitability of Economic Collapse

The Trump Triumph Challenges Economic Predictions for 2017

2017 Economic Headwinds: Housing Bubbles Popping up and Just Plain Popping Everywhere

I’ll bet you can come back in ten years and will find they are the economic trends that prevailed an entire decade beyond their writing. In one later article (“2017 Economic Forecast: Global Headwinds Look Like Mother of All Storms“), I listed numerous additional brewing problems that could reach such a point that they would create havoc, but I never made them part of my predictions. (They were more like vultures circling in the distance.)

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