2020 — the year the world begins to see straight about finance.
Abraham Lincoln once said that a house divided cannot stand. A house divided cannot stand for long — this is a true fact. The EU has about 28 economies within it, many of which are heavily in debt. Greece, Portugal, Iceland, and a few other countries are in a permanent state of being near the brink of default. Germany has been giving Greece some subsistence support in exchange for a little “austerity” or financial responsibility on the part of the Greeks. The fact is that many of the socialist countries, particularly in the Mediterranean do not like the idea of being financially responsible. They want to have extravagant benefits, and pay more out than they take in. In the real world, governments that wish to stay in business need more revenues than they have expenses, and they need savings. The same applies to individuals.
The debt scenario is likely to put a handful of EU countries in default, I estimate by around 2020. The problem is that France, Italy, Iceland, Portugal, Greece, and Spain are all on the list of potential defaulters. Three of the countries on that list are large and owe more than a trillion per piece. This default will cause some sort of a chain reaction and affect the economies of other European countries and world financial markets. The problem for us, is that our careers are based on services for the financial market — namely notary services on loans.
If the EU crashes financially, that could mean several possibilities for the Notary industry.
1. Lower Interest Rates >> More Refinances
World financial organizations will STOP lending to governments since governments will be found to be so unstable. Currently, financial institutions still have tremendous faith in most governments, but that can come crashing down like dominos the minute countries start to default one after the other. Financial institutions will either not lend at all (their business model is based on lending) or will lend to shoe with collateral, namely, people with houses. With many world governments out of the picture as competitors for loans, interest rates could fall, making a lot more work for Refinances possible.
2. A Housing and Oil Crash
It is also possible that the financial panic that results from multiple defaulting nations could stimulate a crash in the housing market leaving home owners with insufficient equity to borrow money. This would result in a slow-down in the already slow Refinance market and could kill the Reverse Mortgage market. Additionally, a crash in financial markets in Europe could lead to a bad depression in Europe. That could lead to a higher dollar due to a lack of faith in European currencies, lower oil prices due to lower world demand, and lower oil prices relative to the dollar due to a higher dollar. It would not surprise me if in 2020, gasoline is sold for $1.20 per gallon. Cheap petroleum could also lead to a spike in US airline profits. I
3. Recession & Lower Interest Rates
However, the depression in Europe which is a market for US goods could cause an economic slowdown in the USA. If there is a slowdown then businesses will not be borrowing as much money for expansion which means that home owners will have lower interest rates which means more Refinances.
What does Jeremy think?
I am not a psychic, although I use my psychic skills on the stock market and my accuracy has been aroun 57% if I meditate before I make predictions. 57% is great because that means I’m right almost 6 times for every 4 times I’m wrong which is good enough for regular profits.
A housing crash, low interest rates and a refusal to lend.
I believe that there will be a housing crash as a result of European financial crashes around 2019, 2020, or 2021. I cannot predict the exact year as each event hinges on another event preceding it causing a domino effect. I also believe there will lower interest rates combined with a paranoia of lending money to anyone. The paranoia that banks had from 2009 until the present about loaning to home owners will continue. Anyone without perfect credit or a high down payment or high equity will probably be denied a loan. Banks will be super picky about who they lend to. Gold could fluctuate quite a bit as people desperate for cash sell their gold and investors paranoid about security buy more gold.
1. Low Interest Rates >> A spike in Refinances to well qualified home owners
2. A Housing Crash >> A downturn in Reverse Mortgages due to low equity in homes after Real Estate downturn.
3. Low oil prices
4. Fluctuating gold prices that end up being higher than $2400 per ounce after 2022.
5. Debt ridden Mediterranean countries will default on loans one after the next. Other more stable governments will crash starting around 2025-ish too like Germany, Japan and possibly the USA (let’s hope not.)
My worst fear is an government financial collapse in the United States. That means your social security check will not come, you might not be able to retire, and all types of economic instability could come. This reality is the result of years of irresponsible financial behavior. If even half of the governments of the world would save instead of being permanently in debt, this global domino effect of government collapses wouldn’t be possible.. Hopefully humans will learn that usury is not a sin because some old guy with a beard who lived 4000 years ago said it is, but because out of control usury causes economic slavery, governmental dependency on other countries, as well as global economic crashes which ruin so many people’s lives. And as far as Notaries are concerned, the future of signing agent work from 2019 to 2030 is very shaky and uncertain. It might be more, less or about the same volume of work.