A Look At 2010 |
Nov 5, 2009 |
All the road signs for 2010 don't look fruitful for our nation. John Lekas of Leader Capital Corp., a Portland financier forecaster and investments manager, is projecting the Dow Jones to drop to around 6300 by year-end, and to drop even further in 2010. Lekas sees the Dow dropping, gold dropping, and unemployment jumping to 16%. Here are his numbers:
Fourth Quarter, 2010:
- DOW-6300
- Gold-$700
- Oil-$33
- Unemployment-16%
Sean Stannard-Stockton noted in his blog, Tactical Philanthropy, that foundation giving will be down in 2010. Sadly, it won't just be down: it will be down and different. Foundations will have far less cash or motive to give, and that will greatly impact nonprofits.
The UCLA Anderson Forecast, released in September 2009, also forecasts a serious drop in our national economy, which will only further erode and destabilize income streams to ministries. They conclude, "the worst recession in seven decades likely ended in the current quarter," but then state that the negative impact of the downturn will last well into the next decade. Simply put, the Forecast believes that the roots of the recession originated in consumer over-indebtedness. Consumer spending, necessary for a robust recovery, will be tempered both by the unwillingness of financial institutions to lend and also for consumer unwillingness to borrow.
So what if all of these pundits are correct? I hate "sky is falling" mantra associated with this data, but the economics we face look ugly. It's hard to argue with this data. We need to put on our hardhats, not bury our heads in the sand. Major gifts will continue to be down in 2010 and 2011, as will foundation giving. Giving as a whole will be down; all nonprofits will face another round of budget tightening as we learn to work in this new normal.
