Here are some excerpts from an excellent article in PC Magazine on predictions from Futurist Mark Anderson along with author Jim Louderback's commentary.
Analyst and futurist Mark Anderson, author of the influential Strategic News Service newsletter and blog has made a career out of making correct predictions. He claims a 93.5 percent success ratio over the years he's been doing annual predictions.
Anderson sees virtually everything else in the world as "laying in a bed of lettuce" made out of oil from OPEC, cheap labor from Asia and elsewhere, and global liquidity and real cash, which are controlled by bankers, hedge funds and traders worldwide. Even worse, he went on, "I think that the Fed has lost control of the US economy", and their ability to "measure what we're doing in any meaningful way."
"I would call it Ben's dilemma (after Fed chairman Ben Bernanke)," Anderson said. "The tools don't work any more; he's the deer in the headlights."
He pointed particularly to how interest rate adjustments no longer can control the economy. "Commercial banks aren't playing any more," Anderson said. "For the entire history of the fed, you raise the rates, they raise the rates. You lower the rates, they lower the rates. Not any more. (The Fed) raises the rates, but the banks are going back down. Why? They are so addicted to the money in the Refi[nancing]… You make more money on the fees, add more points... and then three weeks later you've sold the loan. To who? Fannie Mae and Freddie Mac."
He believes that those two government organizations covered up their bad loan exposure to prop up the nation's economy. "Freddie Mac underreported by... 5.5 billion dollars! (The total amount controlled by Fannie Mae and Freddie Mac, with related mortgage-backed securities is 5.2 trillion.) The national debt is 4.9 trillion," Anderson added. "That's a big story; write it up! Where's the money?"
Anderson then talked about how he was surprised that no one really thinks about Microsoft these days, explaining that when Microsoft sneezes, the entire tech industry gets a cold. "That company is driving the year 2007 for everyone in the tech industry," Anderson said.
...Vista will be a success, Anderson insisted, saying that for all the companies and homes running Windows today, that there's "no question that they are going to buy Vista, 100 percent Vista. There's no question they will upgrade."
But when? Although Vista will ship in January, Anderson says the real inflection point for business will be Service Pack 1.1: "That's when everyone jumps in the pool".
But during a crisis, Anderson said, money will flow to Microsoft before Google – which he compared to a television set. When something breaks down, "Do I spend money on the plumber or the TV set first?" he asked. "You pay for the plumber", he replied to his own question.
He then moved on to discuss 2007 in general terms, calling it a real, true year of transition. Anderson said he sees a tipping point in broadband penetration, as we move from an anemic 256 Kbits/s downstream throughput two years ago to much, much more, "thanks to Verizon and the other guys". This will lead to a river of money flowing down those pipes, he said. In 2007, Anderson forecast, more money will be spent online than in magazine advertising, which will change many companies like it changed Google.
Anderson sees an end to the refinancing boom in 2007, as the economy moves from consumer to business spending. "The question is, (business) has it, but will they spend it?" he said. "People don't spend money because they have it; they spend because they think they can get more. What will be required is a healthy economy, and then those companies will use that money."
He then moved on to some areas of hope, focusing on the upcoming education revolution, sparked by low-cost PCs being built by Gateway, among others, some good news on global warming, and a new era of medicine dawning.
"They call it evidence based medicine...If you are a patient, that is an unnerving idea, because it implies that the other medicine was not based on facts. And that's true!"
ePhones Go Mainstream: "Next year will see the first market acceptance of ePhones in the US," Anderson said. "And the ePhone is a phone where you use it to pay people. It's mobile commerce, mobile transactions, what Bill Gates calls the Wallet PC. But it's not a PC, it's a phone.
"Go to a Safeway, swipe, pay. Go to a gas station, swipe, pay… The phone guys are ready this year, now you will see it coming out in this country. One thing – who's the banker? Visa? Mastercard? If I'm AT&T I'll take that 4 percent, thank you very much. There's a lot of money involved, a lot of float involved. The old guys will be very upset. Visa and Mastercard are in their [Verizon, ATT, Sprint, etc] sights.
I say that yes, this will happen. But I don't think next year is when it goes mainstream. And I'm not alone. Even Joseph A O'Neil, who wrote a very bullish newsletter for Mark touting this technology, thinks he's overreaching. "Three to five years", he confided in me, as the event wound down. But yes, you can kiss your wallet good bye soon. Your phone will do it all.
Authentication Everywhere: "We're going to see ever larger amounts spent on authentication, saying 'you are you',"
"You better have a swipe on that phone, something that says there is a live thumb on the phone, and that the guy that bought that phone is the same guy standing in front of me. It's easy to do; the part costs nine dollars."
Electric Cars: Led by Tesla Motors, this will be the first year of the electric car. Elon Musk and the boys from Google are backing it, there is serious money involved. If this actually happens and they ship (the Tesla Roadster) on time, zero to 60 in four seconds, 139 miles to a gallon, I am sold.
"The hell with hybrid, why not just plug it in? Go 250 miles and plug it in [again]. Seventy-three percent of oil imported into this country is used for gas. This is all electric… They will start building cars (like this) in this country and outside."
Tesla is really exciting, I think. Sure the cars cost around $100,000. But if they can make electric cool – and actually ship them in some sort of volume in 2007, this could be a turning point. According to Mark, lithium-ion battery technology is good enough here. And if we really can power most of our cars with our existing electrical infrastructure, then we have a reasonably quick way out of our dependence on foreign oil. Too bad our government isn't leading the way here.
• Energy: Oil prices move up, not down, returning to $70 to $80 a barrel, continuing an unmatched wealth transfer. Solar goes mainstream with multiple subsidy programs, according to Anderson.
• Advertising: Online ad spending will increase between 20 to 30 percent, probably on the high side of that, according to Anderson.
Dollar Woes Continue: The dollar falls further to the euro and the yen. The dollar will be in the 105 to 110 Yen range," predicts Anderson.
"This is a real war, but we don't pay attention to it. The Saudis control a lot of money. They moved about three billion that was being used to buy American dollars into yen and about two billion into euros. That is a small number, but they are just getting going. I think they'll move 10 to 20 billion into foreign currency next year, a major move out of dollars into euro, into yen. Japan is an export country, so they will spend between 500 billion and 1 trillion in 2007 to intervene in the market to maintain dollar/yen ratios where they want it. That will be tough. It will be the largest intervention ever done."
• New Russia:
"This will be the year when the new Russia emerges, dragging a new Cold War right behind it.... Here's how you negotiate in Thugland. I give you five billion dollars, you give me two-thirds of an oil project, and then I say to you "give me a third back". That happened to Shell today. I'm concerned about every level of Russia, and Putin, excuse me, Stalin. ...People are being killed in cold blood – there's no shame in murdering folks.... The thing is just completely out of control. Cutting off the gas supplies of Europe. We are dealing with a guy that we'd like to think is a refined, hopeful, smart internationalist, who is really just a thug, in the best Stalin definition of a thug. He's willing to burn refineries, which he just did, whatever it takes to get the best price. The world is not ready."
• Multicore: "This is the year when XY computing takes off," Anderson predicts. "Put it sideways and run it in parallel. We are going now. Intel is doing quads, AMD has been leading the way. It's been ten years waiting for this. Remember Sequent and Thinking Machines?"
He's right. The day of the single processor is over and the multi-processor age is upon us. But how will programming adapt? The old, linear approach just isn't working. Anderson hinted about a new image-based programming model that he promised he'd delve into another time.
• Flash Chips: "This will be the year of flash wars," Anderson said. "There are seventeen different fabs coming online and they are mostly NAND flash chips. Get ready for flash computers. Anything that is a computer will be a flash computer. Samsung is bragging that you can have a computer without a disk drive now. It'll be more rugged, faster, and I'm looking forward to it. We'll always use disks for certain things, but we're about to see a huge tectonic change between how we use disks and how we use flash."
• Apple Decline: "iPod maintains its dominant position compared to Zune, but by the end of next year, iTunes looks kind of sick," Anderson said. "The licensing terms of iTunes are shortsighted. Microsoft and Sandisk are more open arms, compared to iTunes. They realize that you want to play your thing on whatever it is you have."
Anderson closed up with four bonus predictions:
• The European Union will reject Turkey.
• ChinaPan (China and Japan together) will be recognized as a new integrated manufacturing center.
• Everyone in Europe is going to the right, because of immigration, but Ségolène Royal will be the next premier of France anyway.
• Boeing will do 25% more orders than Airbus
"Resist generalizations, and we'll all be smarter, richer and thinner. 2007 will confuse one-line pundits, and only you know what is really happening."
"The illiterate of the 21st Century will not be those who cannot read or write, but those who cannot learn, unlearn and relearn."
"Future shock is the dizzying disorientation brought on by the premature arrival of the future."
"If you don't develop a strategy of your own, you become a part of someone else's strategy."
"Cultures that promote desire and pursue wealth do not necessarily obtain it. On the other hand, cultures that preach the virtues of poverty usually get precisely what they pray for."
"Many countries today have begun the transition from an industrial wealth system and civilization to a knowledge-based system - without appreciating that a new wealth system is impossible without a corresponding new way of life."
"Are there conspiracies? Yes, at least 10,000 of them at any given time, mostly canceling each other out. In rare cases, conspiracies succeed - and then disappoint the conspirators."
"Idea-assassins rush forward to kill any new suggestion on the grounds of its impracticality, while defending whatever now exists as practical, no matter how absurd."
"The control of knowledge is the crux of tomorrow's worldwide struggle for power in every human institution."
"We will only keep people from fleeing the countryside into urban favelas, villas miseries, shantytowns and squatter villages when the productivity gap is closed between what brute labor on the soil can accomplish and what advanced technology makes possible today - and will make possible tomorrow."
"Perhaps the greatest cost of wave conflict in America will be paid by the millions of children currently compulsorily enrolled in schools that are attempting to prepare them - and not very successfully at that - for jobs that won't exist. Call that stealing the future."
"We cannot say whether the emerging world will be mostly "good" or mostly "evil" because the very definitions of these terms will change, and it is not we, but our children and their children who will do the judging, according to their own values."
"To think that the new economy is over is like somebody in London in 1830 saying the entire industrial revolution is over because some textile manufacturers in Manchester went broke."
"Change is not merely necessary to life, it is life."
"The future always comes too fast and in the wrong order."
"Parenthood remains the greatest single preserve of the amateur"
"Knowledge is the most democratic source of power."
"Knowledge is promiscuous. It mates and gives birth to more knowledge."
Dies slowly he who transforms himself into a slave of habit,
repeating every day the same routines,
who does not change brands,
does not risk wearing a new color, nor talking to those he doesn't know.
Dies slowly he who makes television his guru.
Dies slowly he who avoids a passion,
who prefers black to white
and the dots on the "i" to a whirlpool of emotions,
Dies slowly he who does not overthrow the table when unhappy at work,
who does not risk the certain for the uncertain
to go toward the dream that is keeping him awake.
Who does not, at least once in life, flee from sound thinking.
Dies slowly he who does not travel, does not read,
does not listen to music, who does not find grace in himself.
Dies slowly he who destroys his self love,
who does not accept help from another.
Dies slowly he who passes his days complaining of his bad luck or the incessant rain.
Dies slowly he who abandons a project before starting it,
who does not ask about a subject he does not know
or who does not answer when being asked about something he does know.
Dies slowly he who does not share his emotions, joys and sadness,
who does not trust, who does not even try.
Dies slowly he who does not intend excelling,
who does not learn from the stones on the road of life,
who does not love and let somebody love him.
Let's avoid death in soft quotes,
remembering always that to be alive demands an effort much bigger
that the simple fact of breathing.