Some economists think that the unconstrained spending and borrowing are tipping the world toward a total breakdown in civilization:
Richard Duncan, formerly of the World Bank and chief economist at Blackhorse Asset Mgmt., says America’s $16 trillion federal debt has escalated into a “death spiral, “as he told CNBC.
And it could result in a depression so severe that he doesn’t “think our civilization could survive it.”
And Duncan is not alone in warning that the U.S. economy may go into a “death spiral.”
Since the recession, noted economists including Laurence Kotlikoff, a former member of President Reagan’s Council of Economic Advisers, have come to similar conclusions.
Kotlikoff estimates the true fiscal gap is $211 trillion when unfunded entitlements like Social Security and Medicare are included.
However, while the debt crisis numbers are well known to most Americans, the economy hasn’t suffered a major correction for almost 4 years.
So the questions remain: Is the threat of collapse for real? And if so, when?
A team of scientists, economists, and geopolitical analysts believes they have proof that the threat is indeed real – and the danger imminent.
One member of this team, Chris Martenson, a pathologist and former VP of a Fortune 300 company, explains their findings:
“We found an identical pattern in our debt, total credit market, and money supply that guarantees they’re going to fail. This pattern is nearly the same as in any pyramid scheme, one that escalates exponentially fast before it collapses. Governments around the globe are chiefly responsible.
I found this particularly disturbing in light of the massive infrastructure breakdown in India this past week:
“And what’s really disturbing about these findings is that the pattern isn’t limited to our economy. We found the same catastrophic pattern in our energy, food, and water systems as well.”
The power grid failure in India left over 650 million people without electricity – that’s half of the country. Think about what a prolonged catastrophic failure would do in the US. Sure, India still has weak infrastructure but complex systems, like a power grid, are pretty fragile even in the best economies and because of our “sophistication”, we depend on ours exponentially more than India does.
I’ve been researching failures of complex systems for some things that we are planning at work and I ran across this paper: “How Complex Systems Fail“. It includes these observations:
- Complex systems are intrinsically hazardous systems. All of the interesting systems (e.g. transportation, healthcare, power generation) are inherently and unavoidably hazardous by the own nature. The frequency of hazard exposure can sometimes be changed but the processes involved in the system are themselves intrinsically and irreducibly hazardous. It is the presence of these hazards that drives the creation of defenses against hazard that characterize these systems.
- Catastrophe is always just around the corner. Complex systems possess potential for catastrophic failure. Human practitioners are nearly always in close physical and temporal proximity to these potential failures – disaster can occur at any time and in nearly any place. The potential for catastrophic outcome is a hallmark of complex systems. It is impossible to eliminate the potential for such catastrophic failure; the potential for such failure is always present by the system’s own nature.
How much hard cash do you have in your pockets right now? How many depend on the internet for voice over IP phone service (if you have a cable TV bundle, you do)? How many use debit or credit cards that rely on electronic transactions? How many people don’t have a land line and have all their contact information stored in your mobile phone? Do you even have a phone book?
What would happen to you and your family if only hard cash was accepted as the medium of exchange? How long would you last?
Food for thought.
The Rio Norte Line 
You mean, there are universal laws of economics that can be ignored for just so long before they eventually cause a correction??? Say it isn’t so! Here, my shocked face again:
Those are good questions Utah. We invested in silver bullion and coins…not nearly enough. Plus, we only keep enough money in the bank to cover monthly bills…everything else is kept in cash, albeit a fiat currency. Probably have about 200 bucks worth of pennies and about 300 or 400 bucks worth of ‘silver’ change floating around. We also have stuff to barter with if the need arose.
But most people don’t think about things like a breakdown in society or even a spate of extended bad weather. They don’t realize that most stores work on a three day resupply cycle. What happens if the stores can’t be resupplied for days or even weeks. At the first inkling of bad weather around where we live and all of a sudden people buy bread and milk like there’s no tomorrow.
“At the first inkling of bad weather around where we live and all of a sudden people buy bread and milk like there’s no tomorrow.”
You must live in Atlanta. At the first snowflake, all of the bread and milk magically disappeared from every store in a 100 mile radius, they closed the interstates, and people stayed home from work by the thousands.
Utah, on a serious side, if there is a global collapse such as this, paper currency is not likely to be accepted. People will revert to what has real value: precious metals, gems, weapons, food, etc.
As for what would my family do? Let me just say this: I am one of the “wack-jobs” who believes this is actually going to happen, and we have been planning accordingly for several years. We even have a place to go when it starts — so those who know we planned will not be able to find us.
Oh, vee vill fint you! Vee hahf our vays, mein liebschen….
Kells, seriously, if the world comes to the point where I bug out of my home, should you find me, the first indication you will have that you have stumbled across my AO will be meeting your maker.
I don’t know what your AO is, but now I’m a bit intrigued….Oh, and I’ve already met my maker.
So, tell us about your NDE.
Yeah. But it will be for a while – electronic stuff goes first, then paper money, then coins, then barter. Tangible stuff like gold, silver and precious stones will be the still be accepted. It will be like a time machine regressing us into the past.
On the brighter side: better a global economic melt-down than an EMP over Oklahoma.
The result will be the same…
Not, an EMP would be far more devastating to the US.
To Ponder:
Those of us who have been responsible for a business or have any COMMON SENSE, or,
have actually studied economics, or finance, or
have studied history and the causes of the downfalls of great civiliations,
Actually understand what these “experts” say is TRUE.
The question is, how far can the rubber band be stretched before it breaks, It may be stretched too far now….
And my question to all is this: WHY? Those who are pushing the world in this direction will be blamed and held accountable. Additionally, why do they push the world to DESTRUCTION?
WHY would anyone want to be at the top of a mountain in a junkyard?
Do some people feel fulfilled when they destroy or see things destroyed? Is that THE reality of EVIL?
Do some people feel fulfilled by “enslaving”, controlling, other people?
I find it to be very fulfilling. Now quit your yappin and suck my stillettos!
What an unfaithful two timing Mistress you are! You said that I was the only one allowed to do that!
She is a blonde ….
I met “her” 25 years ago, that how I learned such expertise with stilettos….
When will you boys ever learn? I must have more than one cabana boy….
Texas, quit your filthy lying! I’m only 21!
and “you” always will be in my mind….. 🙂