Tuesday, January 6, 2009


Out with 2008, in with 2009. More of the same!

Greetings folks! I hope the holidays brought joy and happiness and that 2009 has been kicked off with a bang. For my first blog of 2009, I'm going to focus on two topics, albeit completely different topics, that are at the forefront of the new year.

Let me start my little rant with a small disclaimer: I am not a financial expert, nor do I claim to be. My view is exactly that, my view. They are gathered from my personal experiences and from commentary gathered from those experts that know far more than I do.

Now that we have that out of the way, let me begin by saying that I think 2009 is going to be far worse than what we saw in 2008. My personal belief is that recovery won't come until 1Q 2010. Despite credit rates being relatively low, consumer lending is still far off what it needs to be. With banks giving fewer loans, businesses cutting jobs and consumer spending continuing to decrease, I don't see any positive data to indicate the economy recovering any time soon.

Additionally, the biggest concern I have is commercial loans. According to an analyst at Deutsche Bank, commercial loan losses are expected to increase to 3 percent by the end of 2010. Additional research done by Reis Inc. indicates that commercial properties at risk of defaulting could triple if rental income drops by even 5 percent. Loan losses from commercial properties have the potential to make the sub-prime crisis look like child's play.

Further disaster may come from credit cards and auto loans. Credit companies are already cutting credit lines and our society has lived on credit for the past few years. You cut someones lifeline and chaos occurs. All in all, these two portfolios have the potential to see some drastic deterioration.

Eventually things will get better. How we act and alter our behavior is yet to be seen. Hopefully we can learn from this and ensure that such a crisis doesn't occur in our or our children's lifetime. As a society we need to ween ourselves off of credit and focus on saving and living within our means. Attitudes need to change. Again, it'll get better; however, I think we are in for a lot more darkness before the light begins to shine.

Social Media
Heading into 2009, one of the most intriguing topics is the advancement of social media, most notably within the corporate setting. More businesses are beginning to question if getting involved in social media can benefit their company. Some companies have already embraced social media and seen its benefits, while some companies refuse to look into social media (some rightfully so). However, I think it's a shame if a company doesn't at least look into the possibility of investing in social media.

ComScore came out with its worldwide traffic stats for November and it's interesting to see where specific social media sites ranked. It came as no surprise that yours truly, Blogger, remained in the number one with 222 million unique visitors in November (up 44 percent from November '07). Facebook is second with 200 million (up 116 percent) and is on pace to soon pass Blogger. MySpace, WordPress and Windows Live Spaces round out the Top 5.

An interesting video on Yahoo's Tech Ticker recently asked the question of how much Facebook is actually worth. While it's obviously that Facebook is clearly not worth the $15 billion valuation, has Facebook lost its edge? ComScore numbers indicate no, however, a lot of advertisers are pulling their ads from Facebook due to relatively low ROI. Now part of the reason for a pull back in ad spending has to be attributed to the economy, but I think a lot of businesses are realizing that MySpace, Facebook and other social media sites may have peaked. President-elect Barack Obama's campaign relied heavily on Twitter, however, does that make Twitter a viable investment for businesses? How do you place value on a company who's business model is solely based on ad revenue?

2009 is set to be an interesting year. Change is definitely in the air. What will that change bring? I don't think anyone knows. But that's the interesting part.

Happy Hunting!
- Kasey

Hey, thanks for the comment. Anarchy might not be that bad. hahah
I am trying to follow your blog using the sidebar followers option. It isn't letting me do it. You might have to add the new blogger follower gadget. if you figure out whats wrong (maybe my computer is just being funny) hit me up with another comment so i can follow your blog. otherwise i will never remember.
working now nevermind. stupid computer.
keep on keeping on.

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