My 2017 Crystal Ball Predictions
Here are my 2017 predictions. My 2016 accuracy was 78%.
1. After eight years entrenched at barely 2% GDP growth, the U.S. economy will finally exit perpetual recovery mode into expansion status of at least 3% GDP growth.
2. From 2010 to 2016, regulatory pressure increased on businesses by an unprecedented 80% (Gallup). This investment-suppressing pressure will reverse in 2017.
3. The NFIB Index will report small business optimism increasing for the first time in eight years, as the economy responds to pro-business rhetoric and policies from Washington.
4. As the economy grows, small businesses will see increased profitability due to eight years of deleveraging.
5. For the first time in eight years, small businesses will increase business loan requests.
6. Business startups will increase at a rate not seen for several years.
7. Relevant small retailers will benefit as collapsing irrelevant giants, like Sears, Macy’s, etc., create a Main Street retail vacuum only partially filled by e-commerce giants like Amazon.
8. Small business job creation will lag economic growth due in no small part to productivity technology, which has redefined the growth = jobs symbiosis, forever.
9. With workforce participation at a 40-year low, the growing economy will not directly benefit millions of unemployed and underemployed who lack competitive 21st century job skills, like how to make – or even use – productivity technology.
10. Tax reform and regulatory abatement will cause Corporate America to practice more market capitalism on Main Street and less financial capitalism on Wall Street, benefitting the small business sector.
11. More growing businesses will decide to “Stay private” as short-term performance expectations and expensive regulatory pressures associated with “Going public” increasingly conflicts with the prudence of longer-term planning.
12. Inflation will rise organically with a growing economy – not from Fed monetary policy, which inflation chickens will come home to roost later.
13. Partially due to inflation, the Fed will raise interest rates at least twice in 2017.
14. Global pressures, Trump protectionism rhetoric, if not policies, plus rising interest rates will cause the Dow-Jones to end the year closer to 20,000 than 21,000.
15. U.S. oil production will thwart OPEC attempts to increase prices, leaving the year’s average below $60bbl.
16. Although elected as a Republican, Donald Trump is no party ideologue, and will prove equally frustrating for Republicans and Democrats.
17. In repealing and replacing Obamacare, President Trump will be frustrated by Democrats and Republicans.
18. Complete Obamacare replacement will take longer to accomplish than conservatives would like, possibly years.
19. The Obamacare replacement will include broad market-based solutions (re: Enzi Bill, 2006), plus broad tax credits and no mandates.
20. Obamacare elements of guaranteed insurability and extended dependent coverage will be part of the replacement program.
21. Obamacare popularity now polls upside-down at 51 against/44 for (Gallup). Once established for six months, the replacement system will poll net positive.
22. The smoothest governing issue President Trump will have is with the Congressional GOP on business tax reform.
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23. Congressional Democrats will play their perennial bargaining chip of increasing the federal minimum wage and President Trump will make that trade for something he wants.
24. President Trump will nominate two Supreme Court Justices in 2017.
25. Trump will manage Putin/Russia, but be greatly challenged by China.
26. The most serious global economic threat will come from issues associated with China’s government-controlled financial/banking system.
27. President Trump will regard cyber-attacks from states such as Russia, China, etc., as de facto acts of war.
28. By the end of 2017, very little, if any of the Mexican border “Wall” will have begun.
29. Hundreds of sanctuary cities will become President Trump’s most challenging domestic issue. The cities will lose, but probably not until after 2017.
30. The Trump administration will only pursue an increased deportation strategy against undocumented, known criminals, but will stop accepting so-called, Syrian refugees.
31. The Obama administration’s undermining of Israel in the U.N. will increase debate intensity about U.S. financial support of the world body.
32. While dealing with Brexit, the Euro Zone will also be challenged when Italy tries to use the 2015 Greek bailout playbook.
33. In defense of his legacy, President Obama will not adopt the precedent of outgoing presidents to stay below the public discourse radar.
34. Within two years, Barack Obama, and/or Hillary Clinton, will be proposed for a high-ranking U.N. position.
35. Senator Joe Manchin (D) from West Virginia, will become a (R).
36. The Alabama defense will deliver the NCAA Division 1 title for The Tide, defeating Clemson in consecutive Championship Games.
Write this on a rock … Buckle up. The Chinese curse, “May you live in interesting times,” will not cover 2017, partially thanks to Twitter.
Jim Blasingame is host of the nationally-syndicated radio show The Small Business Advocate and author of the award-winning book The Age of the Customer: Prepare for the Moment of Relevance.