Typically I grade my previous year’s predictions before making a new batch for the new year. But, I’m a little behind the eight ball these days so am sharing my predictions for 2023 while it’s still early January. I’ll follow up in a couple weeks with grades on my 2022 predictions once I have gathered a little more data.
Here are 5 predictions for 2023:
The U.S. Government is going to shut down
While I have some additional insight, writing this first week of January as the House of Representatives is having trouble electing a Speaker, I think this one is clear — with Republicans controlling the house, I expect them to force a government shutdown later this year . The makeup of House Republicans has changed dramatically over the last half decade as anti-establishment candidates have been elected and more mainstream elected have retired; I think a shut down is practically an inevitability given the current political polarization and the fact that different parties control the two chambers.
The Fed achieves the soft landing it is looking for
This is probably the riskiest bet on the list, but I think the Fed is going to be able to bring inflation under control without a recession occurring in 2023. With the economy still stable despite record-setting interest rate increases, the Fed has a little bit more margin for error than it did over the last couple quarters (it also doesn’t need to crush inflation down to its target immediately — trending in the right direction will build confidence in the approach).
More SPAC bankruptcies
The more distance we have from the SPAC boom, the more it looks like a questionable aberration rather than an underutilized mechanism — I expect the lights to go dark on multiple companies that had SPACs in the last couple years, especially in the vehicles space.
Office Fridays are toast
This is more a continuation of a trend from the pandemic reopening rather than something happening uniquely in 2023, but I believe by the end of the year it will be widely common for offices to be empty on Fridays (say, less than 25% occupancy in the loop), forever. Although most employers have not fully returned, even amongst some who have or will, I expect the work-from-home Friday to be an olive branch that employers can offer to employees as a work benefit or in conjunction with something less pleasant.
Growing support for climate adaptation solutions
While there has been a flood of new money into the climate tech space over the last couple years, funding has largely been concentrated in a handful of areas in the mitigation space (batteries, electric cars, meat alternatives, etc…). As the growth in extreme weather events brings home the present-day realities of climate change, I expect there to be significant growth of investments in solutions for climate adaptation and resilience (dealing with the impacts of a warming world, as opposed to solutions that reduce the amount of warming).
Those are my 5 for the year: government shutdown, no recession, SPAC bankruptcies, no more office Fridays, and climate adaptation growth.
