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Culture War Roundup for the week of January 1, 2024

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A year ago, @Highlandclearances made some predictions. I made my own about a month later. I think I did pretty well, though I had an advantage.

@Highlandclearances' predictions are listed first, followed by mine.

Asset Markets will:

  • 50%, 25% (FALSE) at some point in 2023, the SP500 will be 12%+ below its December 31st, 2022 value.
  • 25%, 15% (FALSE) at some point in 2023, the SP500 will be 20%+ below its December 31st, 2022 value.

The Federal Reserve will:

  • 80%, 95% (TRUE) raise interest rates by 50+ basis points.
  • 80%, 85% (TRUE) not cut interest rates before July 1st, 2023.
  • 50%, 50% (TRUE) raise interest rates by 100+ basis points.

The Bank of Canada will:

  • 80%, 90% (TRUE) raise interest rates by 50+ basis points.
  • 50%, 50% (FALSE) raise interest rates by 100+ basis points.

Canada will:

  • 50%, 40% (FALSE) have a “moderate” recession which begins in 2023 defined as either of: (1) a cumulative decline in GDP of 2% across any number of quarters, (2) the unemployment rises to 7% at any point.
  • 80%, 45% (FALSE) see detached house prices decline by 15%+ as measured by the December over December CREA national benchmark.
  • 25%, 15% (FALSE) Canada will have an election in 2023 and … the Liberals will win a minority government.
  • 50%, 20% (FALSE) Canada will have an election in 2023 and … the CPC will increase seats and win the most votes.
  • 25%, 10% (FALSE) Have a constitutional or jurisdictional crisis over provincial / federal issues, probably related to guns, but possibly related to the Alberta Pension Plan, health care funding, or equalization. This is hard to define, but I would take any kind of Meech-Lake style conference, or Supreme Court decision on constitutional questions, the creation of the Alberta Pension Plan, or refusal by local police to enforce federal gun bans as positive evidence.

So, basically, I was correct in not thinking a big economic collapse was so likely. The stock market did very well, and while Canada's economy hasn't really recovered from the pandemic, nothing dramatic happened. The real GDP did not decline, though real GDP per capita did. Maybe the massive surge of immigration has kept the overall economy from shrinking, or maybe it's the reason real GDP per capita is falling.

I still don't know why @Highlandclearances was expecting an election. Something he did get right was the surging popularity of the Conservative Party at the expense of the Liberals, but as long as they continue to get a vote of confidence from the NDP, there doesn't need to be an election for another two years.

Any predictions for 2024?

I'm not sure what was supposed to have happened last year to prompt an election. In mid-2022, the Liberals and NDP had just solidified a not-technically-a-coalition deal. Maybe a collapse there? @Highlandclearances also predicted a higher likelihood of a housing crash and constitutional crisis.

This year, I think the same facts still hold. The Liberals don't have to call one until late 2025. Their polling is terrible right now. My gut feeling is that they stall as long as possible hoping public opinion shifts before then. On the other hand, they're not likely to win the next election anyway. Maybe they try and do damage control by sneaking one in alongside the US election, which is bound to be a shit-show.

My guess: 20% 40% chance of an election this year.

Edit: Doubling this, as there is an additional reason to hold an election early. The Liberals can lose now and leave the Conservatives holding the bag when things get worse in 2025.