I suspect a recession is coming to the US and Canada as well as Europe and the UK in 2020. Maybe the rest of the world too.
Why is that?
Well, real estate prices in desirable, fast-growing cities are accelerating at an unsustainable pace for one.
Two, we have shaky world leadership in London, Moscow, Beijing and Washington.
Three, we are overdue. The real cause of most recession is simply a radical change in expectations, which, of course, I am contributing to with this post.
My oldest son, Andrew Firestone, a senior economist with the Australian federal government in Canberra writes me:
“So, the inevitable property price reset has started in Australia. You guys (in North America) will be next in line. Here is how it happens: interest-rates go down. Prices go up along with debt. Low interest-rates cut investment and income growth leading to ballooning debt to income ratios and then an inevitable crash. If Canada and the US normalized interest-rates now you might get out of it. But I doubt it… I give you 12 to 18 months.”
Hmm. Depressing news.
The wild card is this—if in-migration continues to be high to cities like San Francisco, Boston, Austin, Ottawa, Windsor, Montreal, etc then those places might escape a big real estate correction.
The AI Era
Longer term, I think modern economies could surprise a lot of prognosticators on the upside.
Why is that?
Because of personalized AI (artificial intelligence).
Like Workey.org, where we pair up workeys with clients so they develop a close working personal relationship, I think AI will evolve to the point where we each have a personal AI helping us.
I wrote a whole series on this—my Quantum Entity trilogy. The first book was turned into a movie. Do you want to see what how the director envisioned these personal AIs? Check out this prototype, https://youtu.be/nQbk-dPl4Eg.
The idea is that your personal AI can help you in so many ways and it can work on your stuff even while you sleep… in other words, your personal productivity will soar, and your earnings will too I believe.
I am quite sure the digital economy (and maybe later on, the quantum computing era and economy) will be much larger than the “terrestrial” one, that is, the economy that exists in RL, real life.
How would you like it if your personal AI did your income taxes for you while you slept?
Bruce M Firestone, B Eng (civil), M Eng-Sci, PhD
Real Estate Investment and Business coach
ROYAL LePAGE Performance Realty broker
Ottawa Senators founder
-MAKING IMPOSSIBLE POSSIBLE
-FREEDOM VIA REAL ESTATE INVESTMENT AND PB4L, PERSONAL BUSINESS FOR LIFE
-FEHAJ, FOR EVERY HOME A JOB
-MAKE YOUR HOME WORK FOR YOU, INSTEAD OF YOU WORKING FOR IT
-HIGHER ROI NOT JUST FOR OWNERS AND INVESTORS, BUT FOR TENANTS, GUESTS, VISITORS, NEIGHBORHOODS, COMMUNITIES, TOWNS, VILLAGES, AND CITIES TOO
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