- Although I am by nature a pessimist, I always try to justify my outlook with factual evidence. Similarly, I try to look at the diametrically opposite view. People tend to swing to the extremes at both ends of: optimism, pessimism, fear and greed, myself included. Having said that, the evidence for calamity is overwhelming. The only way I can be optimistic for the future is by being delusional! Paul Farrell lists the potential calamity triggers:
Which trigger will ignite the Great Depression II?
Retire? You can fuggetaboutit if the new Global Debt Time Bomb is detonated by any one of 20 made-in-America trigger mechanisms.
1. Federal Budget Deficit Bomb. The Bush/Cheney wars pushed America deep into a debt hole. Federal debt limit was just raised almost 100% with Obama’s 2010 budget, to $14.3 trillion vs. $7.8 trillion in 2005. The Congressional Budget Office predicts future deficits around 4% through 2020. Get it? America’s debt at 84% of GDP will soon pass that toxic 90% trigger point.
2. U.S. Foreign Trade Bomb. Monthly deficits actually dropped from $50 billion per month to roughly $35 billion. But the total continues climbing as $400 billion is added each year. Foreigners now own $2.5 trillion of America, with China holding over $1.3 trillion in Treasury debt.
3. Weakening U.S. Dollar as Foreign Reserve Currency Bomb. Fear China and other currencies will replace dollar as main foreign reserves. The dollar’s fallen: The main index measuring dollar strength has gone from 120 at the Clinton-to-Bush handoff to below 80 today.
4. Cheap Money Bomb: Credit Ratings Down, Rates Up. Economists at S&P, Fitch and Moody’s were totally co-conspirators of Fat Cat Bankers, misleading investors before meltdown: Soon, debt up, ratings down, interest rates soar.
5. Global Real Estate Bomb. Dubai Tower, new “world’s tallest building” is empty. BusinessWeek warns that China’s housing collapse could be worse than America’s. Plus the U.S. commercial real estate bubble is now $1.7 trillion, a “ticking time bomb” bloating 25% of bank balance sheets.
6. Peak Oil and the Population Bomb. China and India each need 500 new cities. The United Nations estimates world population exploding 50% from 6 billion to 9 billion by 2050: Three billion more humans demanding more automobiles, exhausting more resources to feed their version of the gas-guzzling “America Dream.”
7. Social Security Bomb. We have no choice; eventually we must either cut benefits or raise taxes. Politicians hate both, so they’ll do nothing. Delays worsen solutions. Without action, by 2035 Social Security and Medicare benefits will eat up the entire federal budget other than defense.
8. Medicare: A Nuclear Bomb. Going broke faster than Social Security. Prescription drug benefit added an unfunded $8.1 trillion. In 5 years estimates rose from about $35 trillion to over $60 trillion now.
9. Health-care Insurance Bomb. Burden increasingly shifted to employees. Costs rising faster than inflation. Recent Obamacare plan would have cost $90 billion annually, paid to Big Pharma and insurers.
10. State and Local Government Budget Bombs. Deficits of $110 billion in 2010, $178 billion in 2011on top of more that $450 billion in underfunded state and municipal employee pension funds.
11. Underfunded Corporate Pensions Bomb. From $60 billion surplus in 2007 to $409 billion deficit in 2009. And a whopping 92% of the pension plans of companies are now underfunded. Defaults are guaranteed by taxpayers.
12. Consumer Debt Bomb. Americans are still living beyond their means. Even with a downturn, consumer debt rose from about $2.3 to $2.5 trillion. Fat Cat Bankers love it — yes love making matters worse by gouging cardholders and mortgagees, blocking help in foreclosures and bankruptcies.
13. Personal Savings Bomb. Before the 2008 meltdown savings rate dropped from about 10% in the early 1980s to below zero. Now it’s increasing, slowing retail recovery. Today, government’s the big “unsaver.”
14. War and Military Defense Deficits. Costs of Iraq and Afghanistan wars — $200+ billion annually, $3 trillion minimum, with massive long-term costs for veteran medical care, equipment renewal, recruitment.
15. Homeland Insecurity Bomb. Security at airports, seaports, borders, vulnerable chemical plants all increase budgets.
16. Fed/Treasury Bailout Bombs. Tax credits, loans, cash and purchase of toxic assets from Wall Street banks estimated at $23.7 trillion as new debt was shifted from too-big-to-fail Fat-Cat banks to taxpayers.
17. Insatiable Washington Lobbyists Bombs. Paulson, Goldman, Geithner, Morgan and Wall Street banks, through their lobbyists and former employees working inside now have absolute power over government spending. Democracy and voters are now irrelevant in America’s new corporate-socialism.
18. Shadow Banking: The Derivatives Bomb. Wall Street wants no regulation of this $670 trillion, high-risk, out-of-control casino that’s highly leveraged versus the $50 trillion total GDP of all nations. We forget that derivatives almost destroyed global economies in 2008-09, finally will by 2012.
19. Dysfunctional Two-Party Political Bomb. Polarized partisanship increasing: Every day both parties show zero interest in cooperating for the public good. Instead they fight viciously, resisting everything and anything proposed by opponents. Only goal: Score political points, make the other side look bad.
20. The Coming Populous Rebellion Bombs. Nobody trusts anyone in authority. For good reason. So immediate gratification, short-term betting and a lack of long-term perspective wins for individual investors, consumers and taxpayers as well as Washington, Wall Street and Corporate America CEOs. Today: “Doing what’s right for the common good and country” is just empty political rhetoric.
February 3, 2010 Posted by mosesman | Economics, GeoPolitics, Social Trends | Bailout, Bankruptcy, Collapse, Currency, Devaluation, Fascism, Hyper-inflation, Meltdown, New_World_Order, Unemployment, Unrest, US, War | 13 Comments
Mike Rivero: The Global Tyranny Takeover is Moving into A High Gear Phase! Major False Flag Event To Start The Iran War and Greater Middle East War?
- America is being setup as the ‘Nazi’ war power of the 21st century. Americans need to wake up! You have been lied to on a monumental scale. You will be sacrificed to fulfil the goals of the fascist New World Order for One World Government.
February 3, 2010 Posted by mosesman | EndTimes, GeoPolitics, Social Trends | Bailout, Bankruptcy, Collapse, Fascism, GreatDepression, Illuminati, Iran, Israel, Meltdown, New_World_Order, Riots, Satan, Terrorism, Unemployment, Unrest, US, War | 1 Comment
- We are in the early stages of massive food price inflation. The 3rd world countries will be in serious duress. Most people earn just enough to support themselves and their families. Rising food prices in the coming few years will destabilize many countries including India and China, the 2 most populous nations. In southeast Asia, countries like Philippines and Indonesia will be in deep trouble. Although, the industrialized countries will be affected, the percentage the populace spend on food is much less. For sure no countries will go scot-free. The Economic Times (India) reports:
NEW DELHI/PATNA: Violence erupted against rising food prices in Bihar on Thursday, heaping more political pressure on the government to focus on inflation rather than growth and financial reform.
Mobs stoned trains and jammed roads with burning tyres in Bihar, trying to enforce a day-long shutdown. Shops, offices and schools remained closed on Thursday, when official data showed that food prices in Asia’s third-largest economy rose an annual 17.4 percent in mid-January. At least 12 passengers were injured when angry crowds stoned a train in Hajipur town, while thousands marched in the street in different parts of the state asking shops to shutter.
“Their anger is natural,” said Lalu Prasad, head of the Rashtriya Janata Dal (RJD) party, referring to rising food prices. Food prices have soared because last year’s monsoon rains, which irrigate 60 per cent of farms, were the worst in 37 years. Higher prices paid by government agencies to buy grains from farmers have also helped push the headline inflation rate to 7.31 per cent in December, the highest in a year.
Inflation and a high fiscal deficit are major risks to the country’s ambitious plan to return economic growth back to the 9 per cent a year level seen between 2005-06 and 2007-08. A focus on inflation may also distract the Congress party from pushing reforms such as the liberalisation of the agricultural sector that may help cut the fiscal deficit, which is projected to rise to a 16-year high of 6.8 per cent of GDP in 2009-10.
Food prices have been key to political survival in the past. Onion prices helped push out a state government in 1980. Now, the volatile issue has given opposition parties a handle to attack the government, giving BJP a credible issue against the ruling party, which draws its support from a large chunk of India’s rural poor. “Its the biggest headache for the government right now,” said Saibal Gupta, secretary of Asian Development Research Institute, a private think tank.
Analysts say Prime Minister Manmohan Singh’s government needs to walk a fine line, trying to please farmers, who want higher prices for their produce, and consumers, who want prices to fall. “If (rising prices) not tackled in time … the government may also have to suffer political reverses in states where elections are due.” Local elections are scheduled in Bihar and West Bengal states over the coming year.With public anger focused on high food prices, opposition parties may disrupt parliament proceedings, further delaying debate on bills such as those on land acquisition and entry of private players into the pension sector.
The budget session of parliament starts Feb. 22. The central bank has said that, while food prices are rising because of supply issues monetary policy could not address, it also needed to guard against a break-out of wider inflation pressures. Ahead of a Jan. 29 policy review, Indian authorities seem more focused on whether to tighten monetary policy to rein in inflation at the risk of hurting an incipient recovery.
Societal and economics observer and commentator with an endtimes, future history perspective. Follow me at Twitter: socioecohistory
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