Forecast edition: cautious calls on Canada, the U.S. and China.

• National Post. Happy days are on the way again. “Since 2007, the consensus of the economic establishment-bankers, policymakers, CEOs, stock analysts, pundits-has been catastrophically wrong. They didn’t see the economic storm clouds gathering. When the raindrops began to fall, they failed to forecast the deluge. As a result, throughout 2008, executives, investors, and consumers chased the economy down-cutting back after things unexpectedly got worse; cutting back again when the roof fell in.”
• The Globe and Mail. 2010 markets: What the pundits say. “Four market strategists’ take on what’s ahead for the markets this year.”
• The Globe and Mail. Five reasons to be bullish or bearish on markets. “There’s a lot of uncertainty among investors following the once-in-a-generation rally in the S&P 500 and the S&P/TSX from their panic lows set at the height of the financial crisis. What comes next?”
• CTV News. Recession is over, but the future is still grim: experts. “The great recession of the decade is behind us now, according to top Canadian economists. But Canadians are being warned there’s little relief ahead.”
• Toronto Sun. ‘Lethargic’ economic recovery expected: Scotiabank. “Ever since the economic downturn began in the fall of 2008, consumers have stopped spending, and despite signs the recovery is underway, people might not rush out to the shops in 2010, economists warn.”
• CBC. Eric Sprott’s bearish 2010 outlook. “2009 was a very bad year for the economy – but a very good year for the world’s stock markets.”
• Reuters. Canadians’ economic optimism grows, RBC survey says. “Canadians are entering the new year with a more positive view of the economy and less worry over job security, a survey released on Monday shows.”
• Worthwhile Canadian Initiative. Canadian economic forecasts 2010. Make yours now! “Continuing the ancient (well, one year old) tradition of this blog, I am inviting all readers to make their Canadian economic forecasts for 2010.”
• Toronto Star. Slow growth? Get used to it, economists say. “The real challenge facing Canadians is not that the country will slip back into recession, but getting used to slower growth, economists say.”
• Toronto Star. Daw: Worse losses may lie ahead for U.S. stocks. “The past decade has been brutal for Canadian investors who doggedly held on to the top 500 U.S. stocks.”
• Bloomberg. Feldstein calls lack of 2010 stimulus ‘serious cloud’ on growth. “Harvard University economics professor Martin Feldstein said U.S. economic growth may falter this year because of a waning stimulus from federal spending and tax incentives for purchases of homes and autos.”
• Bloomberg. Krugman sees 30-40% chance of U.S. recession in 2010. “Nobel Prize-winning economist Paul Krugman said he sees about a one-third chance the U.S. economy will slide into a recession during the second half of the year as fiscal and monetary stimulus fade.”
• The New York Times. Contrarian investor predicts economic crash in China. “James S. Chanos built one of the largest fortunes on Wall Street by foreseeing the collapse of Enron and other highflying companies whose stories were too good to be true.”
• The Economist. Ten for the teens. “I find that one-year predictions are too difficult to make (and readers are too likely to remember them at the end of the predicted period), so I’ll offer my predictions for the whole of the next decade. Here goes.”

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