The dawn of a new year is traditionally a time for pundits to prognosticate. What will befall the agriculture economy in the year ahead? How about the general economy? Where is the country headed politically?
As a sometime soothsayer, I've once again succumbed to the temptation to peer into my crystal ball. After all, my forecasts have occasionally been right in years past, and when I'm wrong readers usually forgive or at least forget. This time, though, the only thing the ball reveals is fuzz. So forget the forecasts. The best I can do is try to sharpen the questions.
-- Will 2016 be the year the ag economy breaks out of the low-price rut? As DTN Senior Analyst Darin Newsom likes to say, markets have a Newtonian tendency to continue on the same course until acted upon by an external force. External forces can take a variety of forms, from weather to war to Wall Street getting out of bed on the wrong (or right) side. History tells us one of these forces or another will eventually awaken. Unfortunately, history doesn't say when. It also says oversold markets can stay oversold for a long time.
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-- Will 2016 be the year the national economy falls off the tightrope? It's currently wobbling along at an annual growth rate around 2.5%, tepid by historical standards. If the economy slows much further it risks tumbling into recession. A rapid acceleration might not be safe, either. It would push interest rates up and could propel the high-flying dollar into the stratosphere. That would not only snuff out U.S. exports. It would threaten a financial crisis, rendering borrowers in developing countries unable to repay the enormous dollar debts they've wracked up, which in turn would undermine lenders.
-- Will 2016 be the year the nation charts a new political course, either sharply to the right or sharply to the left? At this early stage of the electoral cycle there are still viable presidential candidates at the far ends of the spectrum. And countless voters are unhappy with the nation's course and open to drastic change. Usually the American majority ends up closer to the center than the wings. That said, one of the sharpest political analysts I know says he can't recall a time since the 1960s when the nation's politics feel as "unsettled" as they do now.
It's tough to make predictions, especially about the future. That thought is usually attributed to Yogi Berra, although it's also been credited to film producer Samuel Goldwyn, Danish physicist Niels Bohr and Danish poet Piet Hein. Whichever of them said it first, it has rarely seemed as true as at the birth of 2016.
Happy New Year.
Urban Lehner can be reached at email@example.com
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