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2011: Better or worse?

By Sheyna Steiner ·
Thursday, December 30, 2010
Posted: 8 am ET

Nearly half of Americans, 45 percent, believe the economy will stay the same in 2011, the Harris Poll has found. The Harris Poll is conducted by pollster Harris Interactive.  

Twenty-nine percent of Americans believe the economy will get better while 26 percent say it will get worse.

Despite those somewhat dour sentiments, there seem to be indications that the market believes the economy may pick up speed next year: Treasury prices have been dropping throughout December and the Standard & Poor's 500 index is up 6.6 percent this month as investors bet on a continued economic recovery, reported Wednesday in "U.S. stocks rise, extending biggest December rally since 1991."

Unfortunately unemployment remains high, at 9.8 percent according to the Bureau of Labor Statistics, which likely accounts for the wait-and-see attitude most Americans have regarding economic improvements next year.

Among the other findings, most Americans say they will save more in 2011, 40 percent, and 22 percent say they plan to get rid of credit card debt.

Eight percent said they will invest in less risky investments.

Maybe the small numbers of investors planning to invest in less risky assets next year reflects the more enthusiastic attitude the markets seem to be taking. Plus, the bond market, traditionally the safer place to invest, may be a hazardous place to be in the next couple of years.

What are your predictions for the economy?

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Sheyna Steiner
January 03, 2011 at 9:51 am

I can see why it would be difficult to glean my knowledge of California's finances, or lack thereof, from this particular blog post...

States, cities and towns are hurting, that will likely be a recurring theme this year, my sources tell me. It's not just California, of course.

Police forces across New Jersey are being, or have been, pared down due to budget shortfalls. Bloomberg reported Jan. 3 that Illinois has a $13 billion budget deficit.

In the Bloomberg story, "Illinois Has Days to Plug $13 Billion Deficit That Took Years to Produce," Tim Jones, writes:

"Illinois’s deficit, about half its $26 billion general-fund budget, puts it among the U.S. states confronting $140 billion in shortfalls in the coming fiscal year after closing $160 billion in gaps this year, according to the Center on Budget and Policy Priorities, a Washington research group."

Marge Smith
January 02, 2011 at 10:58 am

The reason some are "dour" is because most states are in the red and will be forced to layoff! I can't believe you don't know that California is even worse off than before with a 25 BILLION deficit looming.