What's 2008 going to look like for investors, savers and borrowers?  First, no one knows for sure, but based on the accumulated inputs provided by knowledgeable sources in finance and investing, here is the general picture.
 
For borrowers the picture looks generally good.  Mortgage write offs, credit card losses and increasing write offs on small business loans will pinch banks balance sheets and income statements.  The slowdown in economic activity generally, combined with the banks problems, will keep the pressure on the Federal Reserve to lower interest rates throughout the year.  Borrowing will be cheaper, but credit will be harder to get than in previous periods.  Banks are going to be much more selective and tighter on credit terms. for those with good credit and legitimate need, an optimistic outlook.
 
For savers and for those who rely on fixed returns from certificates of deposit and similar instruments, things are not looking great.  As rates drop, so does the income generated by these financial options. savers need to look at the maturity dates of the assets they own.  They need to aggressively shop the marketplace for the best and safest rates available.  It might also be wise to look at small percentages of holdings invested in high yield bonds and some Canadian Energy Trusts which are still producing yields in the +10% area.
 
The investor has had a rough time in the last part of 2007.  All of the major indexes have dropped from earlier highs, and stocks in financial firms have lost nearly a third of their previous value.  The keyword for 2008 is caution.  Large, international companies offer the best opportunity for growth.  They can benefit from growth overseas, and the weak dollar to offset slower domestic growth.  As always, each portfolio must be diversified, so don't put all of your invested eggs in one basket.  Look for recovery in financials, good profits in energy and technology to remain strong.