The completion of a full year in financial crisis sees America's financial and political leaders declaring that the end of the recession is near, that prosperity is coming, and that the whole financial nightmare will begin to draw to a close in 2010. If only it were true.

The truth is that the economy will appear to pick up in 2010, but it will ultimately prove, once again, to be an illusion. Many newly created jobs will  appear and then ultimately disappear, many within the same year. Large numbers of people who are no longer counted as "unemployed" because they've been without a job so long that they no longer qualify for benefits will spend the year bouncing between joblessness and temp work. This will encourage commentators to claim that the "green shoots" have taken root.

Some real estate prices will temporarily recover in the spring, but overall foreclosure rates, which had seemingly slowed in 2009 will suddenly become a big issue again. The net result for the year is that prices overall will be stagnant at best and quite possibly declining again by year's end.

Meanwhile, the big question that the financial media will focus on is: when will the Fed start to pull back on their "stimulus"? The Fed has shown every indication that they'll be very reluctant to do so, keeping rates relatively low. The further through the year we get, the more dire the situation will become. Parts of the economy (likely health care among them) will show signs of exploding, while other parts of the economy will remain stagnant and depressed. Eventually, the Fed will decide to start raising interest rates by the end of the year, just as mortgage resets reach numbers not seen since 2007 and early 2008.

This action will be widely seen as an attempt to gouge the borrowing public in an attempt to create a bailout for the banks, which are now in serious trouble on their balance sheets. The issue of "too big to fail" will once again dominate the news, only this time public reaction against it will be fiercely negative.

In response to the public's overwhelming sentiment, the Fed will choose to "stay the course" heading into 2011, when mortgage resets hit the same levels as we experienced when the crisis first hit in autumn and winter of 2008. This policy will only last for a short time, however, as a new round of bank failures threatens the powers that be once again. Ultimately, the Fed will have only one choice: monetize more debt in order to cover the losses, which is exactly what they'll do. This will send the commodity markets into a buying frenzy, driving resource prices through the roof.

Meanwhile, President Obama's new war in Afghanistan will prove to become a major drain on money, lives, and resources. It will become more and more unpopular. Attempts to ignore it by focusing on global warming will fail miserably, but global warming advocates won't let that stop them.  Violence will become a staple at all global conferences as a result. Iraq and Iran will both become more problematic as violence and upheaval mark the news coming from both countries.

The mid-term elections of 2010 will prove to be disastrous for incumbents in Congress, comparatively speaking to what they normally expect, with both parties losing more than 40 seats, although unfortunately the vast majority of those who replace them will prove to be no different than the ones they replace.

So will there be any good news in 2010? Yes, but it you'll have to look for it. We'll continue to see small signs that people have had enough of the status quo.