Big-picture predictions for 2009 -- and some closer to home

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Among those offering their looks ahead at 2009 in ‘How to Play the Crisis,’ accompanying today’s Wall Street Journal story ‘The Doomsayers Who Got It Right,’ are Paul Kasriel, economist-researcher at Northern Trust Co. in Chicago, and economist Robert Shiller, co-creator of the Case-Shiller index.

Although not addressing housing per se, Kasriel -- who noted that home prices were too high back in 2004 -- said he thinks lower interest rates and governmental spending could bring improvements by year’s end. ‘Now that everyone’s pessimistic, I think there’s a good chance the economy is going to stage a recovery,’ quotes the WSJ.

Shiller’s summation: Sellers need to accept lower prices to get things moving again, and we could be in for at least a decade of stagnation.

Also in the prediction mode, this from Fortune’s ‘10 Worst Real Estate Markets for 2009’:

Eight California cities make their list. Here are the rankings, cities and 2009 projected price changes: 2) Stockton, -24.7%; 3) Riverside, -23.3%; 5) Sacramento, -22.2%; 6) Santa Ana-Anaheim, -22.0%; 7) Fresno, -21.6%; 8) San Diego, -21.1%; 9) Bakersfield, -20.9%

Double-digit drops in home prices on top of this year’s declines? To quote Mr. T: ‘Prediction? Pain.’

--Lauren Beale

Thoughts? Comments?

Robert Shiller’s Case-Shiller index compares the latest sales of detached houses with previous sales.