THE Biggest Trends in 2010

The economy will continue to be the biggest story in 2010. In a macro context, will countries around the globe continue to grow? Will people make more money? Will people with money continue to save and invest that money? We have seen GDP growth in recession stricken countries like the United States while others like Great Britian have yet to recover. Other countries like the emerging economies never suffered recession, merely a slow down, and are enjoying robust economies.

PREDICTION 1: Emerging markets will require redefinition as countries like China, Brazil, Mexico, Botswana, and Rwanda lead the world in trade and econonic growth while developed countries will continue to remain fragile economically. Emerging markets will no longer be so emerging but become more powerful and have a louder voice in global matters as their economic clout grows. Copenhagen and the formation of the G-24 are prime examples.

Money being at the center of trade and economics is certainly changing but will never disappear. The GBP is giving it the good fight. So much so that the inevitable positive GDP print could spark a rally in sterling across the board. I point to the recent rallies going into the new year that saw both the USD and EUR weaken to key levels into the new year. This first week will be closely watched as markets start to return to normal after the long holiday.

PREDICTION 2: The GBP rallies next year, particularly in the first half of the year as markets react to positive global economies. The improving global economy led by emerging markets increases investors’ appetite for risk benefiting sterling. Also, propping sterling will be the start of tightening measures by the BoE as the central bank is now able to begin tightening measures due to wiggle room given by positive economic developments in the UK. The EUR will rally in the first quarter as the ECB’s inflation focused mandate forces them to also tighten but will then weaken for the rest of the year as sovereign debt issues balloon in the European Union and Eastern Europe. The JPY resumes its rightful role as a funding currency as Japan will continue to fight deflation and looses its title as the 2nd largest economy in the world to China. Commodities, particularly metals (real money), will continue to rally and post record, all-time highs.

Sustainable business innovation becomes a welcome trend in 2010. As households improve their balance sheets, the corporate sector also learns from the recent crisis and begins investing again. And I don’t mean advertising spend. I mean real impactful investments in R&D, infrastructure, product development, and, yes, human capital.

The Internet will continue to prove itself the greatest disruptive technology of this new decade. Its enabling of freeconomics, has forced innovation in business of a new type. All businesses are facing pricing innovation in a marketplace where free is the price ceiling. Companies that can capitalize rather than fight this new paradigm shift will be the real creators of wealth and economic growth.

As economics responds to free and digitization, media becomes ubiquitous. New media, social media, interactive media, old media drop the descriptive and is simply, media. Well designed, legible, high quality content available anywhere (mobile and cloud computing) is KING. Media also becomes richer, more engaging as content creators figure out how to monetize free. Content that scales the best will separate quality content and platforms from the rest.

PREDICTION 3: Twitter’s fail whale rate will improve from 75% to 25% as the platform become more stable as the company invests in infrastructure improvements. Apple will introduce another business model that capitalizes on free with its tablet device. Google will test $1000 share price and become the first company built on the business model of free that does so. Facebook will follow. BlackTree Media maximizes on all these technological and economical developments to be THE media outlet for global young adults and be mentioned by CNBC, CNN, and StockTwits.

2010 has a lot in store. We will be trading, teaching, and doing business in a much different economy and business environment. Companies will have to be leaner and more responsive to survive a more frugal consumer that demands more for less. Companies that can deliver on this expectation consistently will be the next winners of this new decade. Countries that invest in the proper infrastructure plays of energy and hard goods will emerge from recession and secure economic prosperity for its future generations.

PREDICTION 4: Technology will continue to flatten the world, connect us in more ways, and disrupt old models of economics and business. But this really isn’t a prediction is it?

(photo courtesy of Andrea Mazzini)