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Part one of what I hope will be on the coming "perfect storm" of financial and environmental crises that will threaten America's number one status

I find myself forced by necessity to discuss a great number of combined factors here folks, so please bear with me.

We live in a very interesting time in world history. Unfettered capitalism is hitting a wall in both capacity (think resources and people) and of its ability to shape a narrative that people will buy on a large enough scale to swing elections.

In 2008 the entire economy lost it's mind as vast amounts of wealth evaporated overnight. Instead of reigning in the excess and regulating the finance market, our elected leaders decided to double down. Our government saved and rewarded those who should have at least, been punished.

To add insult to injury the ink was scarcely dry on the pay bonuses and salary increases of the very same finance industry and moneyed interests that caused this catastrophic collapse, then the very same people started screaming for "austerity" (read: the destruction of what is left of the social safety net)

Interestingly enough both here in America and abroad the working class has yet to draw a point on a line between massive financial fraud on a level unseen since the beginning of this country and the crushing level of debt that our grandchildren will have to pay.

Hurricane Sandy brought into consciousness the possibility of climate change as a real topic of national debate but I severely doubt that we as a country will be able to make any real sense of what is happening climate wise until we face a serious threat to our way of life on a national scale.

I believe that this has happened because of two major factors.

1. Our government and media have been completely captured.

2. American debt is cheap, the rest of the world sees the United States as a safe haven for money. This, is what ultimately will be our undoing.

American debt is cheap because we are the worlds sole remaining superpower.

The disturbing question I will ask is as follows:

What happens when Europe gets back on it's feet and China starts consuming rather then loaning us their entire manufacturing base on a debt basis?

We no longer produce anything in this country. What production we do have is primarily centered towards the military industrial complex. We have a economy structured on an excess of petroleum and cheap Chinese money.

Our infrastructure is outdated, in a shambles and far over capacity for the number of people we have in this country.

The window we have to borrow money cost free is disappearing. Financial regulation will come too late and by the time we as a country will come to realize the depths to which we have been sold out, we will be a third world nation at best, and consumed by revolution and unrest at worst.

Unrest is what I will talk about because I believe that unrest is coming in this country. This will not be a peaceful time in our history because we are in a perfect storm of circumstances both economic and environmental.

More later.

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Comment Preferences

  •  How do you figure we're number one right now? (4+ / 0-)

    We're number one in debt, prisoners, wars & militarism, cocaine use, depression, percentage of obese citizens, divorce rate, television watching (tied for first), gun ownership, health care expenditures (we don't get what we pay for)...

    What else are we number one in?

    •  re: (1+ / 0-)
      Recommended by:
      mookins

      We are the worlds only remaining superpower as measured in the metrics of being able to project hard and soft power to any area of the globe and our GDP

      As our ability to borrow money decreases the militarism will be the last thing to go, unfortunately.

    •  Der Speigel has a long article on the (1+ / 0-)
      Recommended by:
      mythatsme

      decline of the US (picked this up from Barry Ritholtz).

      The article agrees with you that we are #1 in incarceration and the military, but not much else (the number of adults who believe in angels?).

      The quote that really got me is this:

      The power lines in Brooklyn and Queens, on Long Island and in New Jersey, in one of the world's largest metropolitan areas, are not underground, but are still installed along a fragile and confusing above-ground network supported by utility poles, the way they are in developing countries.
      No lecturing or gloating, simply disbelief.
  •  all very interesting but (4+ / 0-)

    signifying nothing.   You make points that are obvious to all us here.  What is the point you are trying to make?  What invites us to Part two?

    •  Part two (1+ / 0-)
      Recommended by:
      mookins

      Will be about various environmental factors leading to the desertification of our prime farmlands. Canada is going to have all the prime farmland, but I will have to cite a lot of factors to make my case here and that will take time.

      I will also be talking about the media and how Americans are so divided and polarized that when the shit does hit the fan, we won't know who to lash out against.

  •  How is this different or worse (3+ / 0-)
    Recommended by:
    palantir, dmalrajabi, mookins

    than other times of financial crisis (see 1929-1937)

    Just being the "devil's advocate" but it seems to me that every time of crisis forecasts the immanent doom of the US.

    I'm a mushroom. Kept in the dark and fed....you know

    by The Voice from the Cave on Sat Nov 17, 2012 at 09:13:57 PM PST

  •  The notion that we don't produce anything in (5+ / 0-)

    this country is a gross exaggeration. America's manufacturing base has declined relative to the rest of the world, but we are still the #1 manufacturer. It's true that defense related manufacturing is a higher than normal portion of that, but I don't think the non-defense manufacturing amounts to nothing.

    The question of what happens to the dollar when it loses its primacy in the world, however, is quite serious. A great deal of its value is related to the rest of the world using it to store wealth, and a change in that would lead to a very serious crisis. It's unfortunate, because even trying to prepare for an eventuality is probably political poison---there are just too many people who would consider it an affront to America's greatness to even acknowledge the danger.

    Compassion is not weakness, and concern for the unfortunate is not socialism.

    by Zutroy on Sat Nov 17, 2012 at 09:22:03 PM PST

    •  ask yourself this (2+ / 0-)
      Recommended by:
      codairem, buckstop

      When GM and Chrysler were going to go under, do you remember what percentage of the economy was going to be directly affected?

      I am genuinely asking this because I don't remember, but I did hear one fourth of the manufacturing base would be directly affected.

      •  The figures I remember hearing were (1+ / 0-)
        Recommended by:
        buckstop

        3 million jobs that would be lost and $150 billion out of the GDP. It's my understanding that there are about 13 million people working in manufacturing, which would mean a little less than a quarter of them are tied to the auto industry.

        Compassion is not weakness, and concern for the unfortunate is not socialism.

        by Zutroy on Sat Nov 17, 2012 at 11:07:13 PM PST

        [ Parent ]

  •  Loan is a noun. (1+ / 0-)
    Recommended by:
    NewDealer

    Banks (and nations) lend.

    "Life and death, dispensed on a dollar basis. How ridiculous and fatally stupid, in what is still the richest country on earth?" Exmearden

    by burana on Sat Nov 17, 2012 at 09:29:15 PM PST

  •  Foreign Debt will not be our undoing but theirs, (2+ / 0-)
    Recommended by:
    DBunn, tampaedski

    When and if the dollar is no longer the reserve currency of the world, the cost of foreign borrowing will of course go up and the value of the dollar will go down.  This of course does not hurt the US, it removes value from the foreign owners of our debt.  

    Currently I think foreign owned debt is somewhere near a third of our outstanding debt.  If the value of the dollar were to fall by 50%, the domestic owned debt would not be affected but that third of the debt that is held and is subject to foreign exchange would be reduced by 50% relative to the foreign owners currency.  So based on current debt levels about $5.5 trillion is owed to foreign holders, thus a devaluation of the dollar by 50% would reduce our relative debt by $2.75 trillion.  This of course has little to no affect on our domestic economy from a debt standpoint.  The point of this is, we have an independent fiat currency that has relative value to domestic products that would not change while the foreign debt held would be dramatically reduced.

    The positive side of a major devaluation would be the relative value of goods and services offered by US based manufacturers and service providers.  If you reduce the cost of those goods and services relative to foreign currencies our ability to sell to foreign buyers would be a huge positive gain.  The downside is all those cheap foreign goods we get at the big box stores would go up in price by 50%.  This would be a shock to our economy until domestic producers were able to ramp up domestic manufacturing.

    Our foreign debt will never be a major factor in any kind of domestic upheaval or unrest.  The foreign owners of our debt have a rather large incentive to continue to loan us money and help keep our economy growing.

    "If Tyranny and Oppression come to this land, it will be in the guise of fighting a foreign enemy" James Madison 4th US President

    by padeius on Sat Nov 17, 2012 at 10:25:05 PM PST

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