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2007 - the year the wheels came off, or did they?
Some commentators are saying that 2008 will be the worst year for Western economies since the oil price hike of the 1970s, which plunged our bit of the world into recession for a decade.

Others are saying we'll all get over it, the first part of next year might be tough but then normal service will be resumed.

In other words, no one's got a clue.

It's undoubtedly true that stock markets are yo-yoing, that bankers have lost lots of our money and that the immediate economic outlook is a nasty combination of slowing growth and rising inflation ('stagflation' as some would have it, although to me this means people in 1920s Germany with wheelbarrows full of useless Deutschmarks).

The facts are that markets are off the dizzy peaks they reached in the summer, when the sub-prime market was just a nasty pong in the corner of the room.

Now it's a big smelly elephant holding centre court in the middle of the living room, and it's not going to go away for a bit.

So money will be more expensive next year, economic growth will slow and the central banks (as they're doing already) will have to bail out our friends at the likes of Citigroup, UBS and dear old Northern Rock by pumping billions of taxpayers' money into the markets to rescue the bankers from their own folly.

Nice work if you can get it (being a banker, I mean).

Economic forecasters rarely go broke by forecasting the end of the world. But somehow or other it never happens (or hasn't yet).

So there'll be a big slowdown in the early part of 2008 and a pick-up in the second half of the year as the slowdown curbs inflation and bottom feeders start buying shares again.

That's this column's prediction anyway.

Unless Messrs Bush and Cheney decide to bomb Iran after all, in which case we're all up a Gulf without a paddle.

• The CBI has downgraded its UK economic growth forecast from 2.2% to 2% for 2008, its third consecutive downgrade. But 2% isn't actually that bad, it suggests that, despite the mayhem in the banking sector, the rest of the economy will keep its head above water.
• Will Smith's new film 'I am a Legend', a cheery tale about the last plague survivor on earth (I suspect he finds another survivor somewhere who might be female), took $76.5m on its opening weekend in the US, a record for December.
  "It's nice to be in the Will Smith business," said studio Warner Brothers' head of distribution Dan Fellman. Historians will note that the great age of Hollywood coincided with the depression of the 1930s.
• Spaniards are tipping six times more than they did before the euro came in, leaving one euro (the equivalent of 166 pesetas) instead of the old 25 peseta coin.
  This is leading to inflation, warns Spain economy minister Pedro Solbes.
  Good news if you're a Spanish waiter, anyway.
• Mind you, the FTSE 100 opened sharply lower today (Monday) following falls in the Far East this morning.Wall Street fell 2% last week (as it often has done recently) but fell on most days (usually it falls one day and goes up the next).
  So the bears (people who think shares will fall) are in the ascendancy.
  And finally..
• Soon it will be the holidays and maybe afterwards dealers and even bankers will regroup and, in the case of the latter, start lending to each other again.We may even get a solution to the Northern Rock fiasco (contender Olivant agreed to put up some more capital over the weekend). A resolution of this depends on the bankers of course, chiefly Sir Fred Goodwin at RBS and the new team of Vikram Pandit and Win Bischoff (an Indian and a European, no less) at US giant Citigroup. Can they (in particular the currently enfeebled Citigroup) drum up around £11bn?

City Republic is taking a break too. We'll be back in the New Year.

Merry Christmas and Happy New Year.

Stephen Foster is a former news editor of ±±¾©Èü³µpk10, former editor of Marketing Week and Evening Standard ad columnist. He is a partner in Editorial Partnership and writes the blog and Politics of the Media for Brand Republic.