A Muddle-Through Year

Soft Landing?
Dots and Markets
Possible Drama
Washington, DC, New York, and Cape Town

First, let me wish you the best for the new year. I look forward to exploring it with you.

It’s forecast season again, the time when people like me tell people like you what will happen this year. Sadly, we are often wrong. It turns out predictions are hard, especially those about the future (with apologies to whoever said that first).

However, these forecasts can still be useful in the same way stripes in the road are useful. Unexpectedly bad things can always happen, of course. Yet the stripes help you move in a generally safe manner. Moreover, if circumstances force you out of your lane, then you know some new challenge is ahead. You might need to consider a different route.

For 2024 I expect a “stay in your lane” year. It will no doubt bring events we don’t currently anticipate. We will have to navigate around them, possibly at significant cost, but I think we’ll Muddle Through. Some unexpectedly good things will happen, too, even if you don’t hear about them.

In sum, we’ll stay on course toward the debt crisis I’ve long anticipated. At this point, nothing short of a major miracle can prevent it. But that’s still a few years away. Meanwhile, the economy will proceed much like it has been, with stubborn inflation and low unemployment keeping recession at bay.

How it will happen matters, though. That’s the part we really need to consider.