What does 2009 hold?

Here is a bit of crystal ball gazing on the year ahead. Something to cogitate as you launch into work. Talking to people over the past couple of weeks has been fascinating as there seems to be two distinct schools of thought: One being total doom and gloom, and the other mildly optimistic. It will be no surprise to many readers that I am in the latter category. My take is that the first part of the year will be tough, but things will improve. (After all, we can’t have two consecutive years like 08 can we?) Perhaps one of the biggest indicators of trouble will be in employment – or should that be unemployment. I have come across a number of people who have been retrenched recently and there is no doubt more to come. This, though, tends to be on the corporate side. On the other side, and this is the adviser market, numbers will hold up and you may even see some former fundies and the like become advisers. Another thought this year is it may be one of significant corporate action. We haven’t seen much happen in this space for a number of years, but a couple of names spring to mind, some of which will either be sold or closed down. In this space I am not thinking finance companies, rather fund managers and life offices. As for punters, well they will have no choice but to look towards shares and property again. Fixed income will be a big under-performer for the year and many of the offers (such as TDs) have barely any real return. Cash, which has looked so damn good, has already lost much of its shine. Property must look attractive, particularly residential, as money is as cheap as it has ever been, the market is down and this government isn’t likely to penalise property investors. Shares also look cheap, but I suspect it will be harder to persuade investors to go down this route as opposed to property. One space which will, I suspect, create a lot of discussion is adviser regulation as we now get down to the details. There will be lots of debate in this area, and some will be fierce. Key things to look out for are the appointment of a Commissioner of Financial Planners and who leads the charge at the IFA. The commissioner appointment may set the tone for the changes. I understand the choices are wide. Many people applied, some bureaucrats (with little first-hand knowledge of the industry), some industry people and some who aren’t necessarily that in love with the current work planners do. No doubt it will be a fascinating year. I’d welcome readers’ thoughts on what they think 2009 holds.