The year that was 2008

Financially, 2008 is the year most people would quite like to box up, put in the back of the cupboard, and never speak of it again, much like a crappy, bad-taste Christmas gift.

You just have to check out a list of the most search terms on any of the major search engines to find the total shift in our mindsets on the economy in 2008. Suddenly, people cared – deeply – about the state of the world’s finances.

My favourites were the brand new breed of armchair economists. Finance went from serious Nerd-dom in the news room, to an in-demand commodity (unlike most of our Australian commodities, which took a serious dive, thanks to slowing forecasts out of China and India, and the world’s economic downturn).

Everyone from the barista to the hairdresser went from a passing interest in the world of finance, to asking all the serious questions. Would their deposited money be safe in Australian banks? (Yes. In October, the Government pledged to guarantee bank deposits – cue huge sighs of relief for all except those who had parked their money in non bank financial institutions not covered by the guarantee) .

Should they cancel their holiday to the US with the dollar seriously in the doldrums, and only predicted to get worse? (No point cancelling your holiday, all the experts say this dip in the dollar is going to last a while. In November, State Street predicted long term the dollar will fluctuate wildly, and we’ll see a 39c dollar, but I think that’s a little extreme). What about their super? (All OK if you’re planning on leaving your super in the fund for the next few years. If you’re of retirement age – disaster.

Many will be forced to work at least another extra year, with many funds experiencing negative 16% returns this year). What about the value of their investment unit? (Nightmare if you live in outer Sydney, Melbourne or Brisbane. Great in the inner cities. Perth finally stopped rocketing upwards).

Their mum’s Commonwealth Bank shares? (In 2008, the value of CBA shares has dropped from a little over $61 to – at the time of writing, $28.10. The entire Australian sharemarket at its worst dropped an eye watering 40%). And why does all this stuff happening in America have anything to do with our market? (in short – and this isn’t the whole story, because you’d still be reading this during the January sales - a massive housing collapse in the US, including the now infamous US ‘subprime’ market, meant huge stock falls, job losses, and big company collapses in the US.

That spiralled into the UK and Europe, and it wasn’t long before our stockmarket was heavily affected. That really hurt our financial sector and the banks. Our confidence as consumers dropped. That if it continues will really hurt the retail sector, and the housing sector, and all kinds of things).

But we can’t go and exchange the financial woes of 2008 at the department store. Although you should at leats be at the department store, because K-Rudd and the gang have asked us to spend, spend, spend the risk of a recession away.

And if 2008 was the financial equivalent of a crappy Christmas gift, the first half of 2009 is going to be just as bad, if not worse. Anyone got the exchange receipt?!

Joanna Townsend is a reporter at the Nine Network

Is Jo right? What are your thoughts on the year? Have your say by commenting below