posted on Feb, 28 2007 @ 01:22 PM
I think that the risk of severe economic distress in the U.S. is substantial, something similar to, and maybe even worse than, the Great
I think this is because there are extreme imbalances in the globalized economy that, when they unwind, will hit the U.S. particularly hard. These
factors include the federal deficit, trade imbalances, the loss of manufacturing and manufacturing jobs, extreme debt and financial leveraging, the
slide in the housing market, risks to the value of the dollar, dependence upon oil and oil's dependence on political stability in the Middle East,
etc., etc. So many trends look very bad indeed, and it is possible that many of these things could hit the fan all at once -- a perfect storm. Many
things could be the trigger that would start the dominoes falling -- hedge fund failures, for example, or a U.S. attack on Iran that would send oil
prices through the roof.
I fear it could be worse than the Great Depression because of the technology traps that exist now that did not exist in the 1930s. Also in the 1930s,
the U.S. population was much closer to its roots as an agrarian society, and most people could cope much more independently with economic hardship.
Now we have much longer supply chains that are much more vulnerable to economic shocks and delivery shocks.
We also have an authoritarian regime in power in the U.S. that is just itching to restrict invididual liberty, weaken our democracy, and assert
It's impossible to predict, of course, but my gut feeling is that the chances of an economic breakdown in this country within the next two years is
greater than 50 percent.