Economist Richard Duncan: Civilization May Not Survive 'Death Spiral'
By Terry Weiss, Money Morning
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?
http://moneymorning.com/ob/economist-richard-duncan-civilization-may-not-survive-death-spiral/ (http://moneymorning.com/ob/economist-richard-duncan-civilization-may-not-survive-death-spiral/)
My understanding we will will be downgraded again if we don't change our ways soon. :scared: :scared:
Quote from: walkstall on September 12, 2012, 06:19:47 PM
My understanding we will will be downgraded again if we don't change our ways soon. :scared: :scared:
I find it interesting how he says you need to protect your assets when and if all Hell breaks loose.
If all Hell breaks loose, there won't be any assets to protect.
I'd suggest stocking up on food, because money won't be worth a damn if it happens.
Quote from: Solar on September 12, 2012, 06:43:27 PM
I find it interesting how he says you need to protect your assets when and if all Hell breaks loose.
If all Hell breaks loose, there won't be any assets to protect.
I'd suggest stocking up on food, because money won't be worth a damn if it happens.
Food and gas will be my assets. :cool:
Quote from: walkstall on September 12, 2012, 07:20:01 PM
Food and gas will be my assets. :cool:
Same here, if money is worthless, considerably less, then why hang onto it, buy now while you can still afford it.
I'm about to buy two more years of freeze dried food, as well as purchase another 1000 gallon diesel tank.
I just can't see how this pyramid scheme can continue, when our govt keeps printing worthless paper, with nothing to back it up.
I know this is a bump, but it's a good topic.
One the main reasons our national debt has not hurt our economy as much as it could is because we're still the 'world currency'. Other countries who have debts as high as ours ( relative to GDP) have to face some hard consequences. There is an artificial need for the U.S dollar world wide because the majority of the world still does business transactions between each other in US dollars.
If this changes, and there is some evidence to support that this may happen in the future, then America will see some real consequences such as inflation and less overseas investment into our economy.
I'll try to post some links later if anyone is interested. I think one example was China and Japan talking about not trading in U.S dollars.
It was reading that article that prompted me to post that collapsing economy post in the other forum. I was sufficiently spoiled to take a good long look at our family resources.
Quote from: redlom xof on September 21, 2012, 06:36:27 AM
I know this is a bump, but it's a good topic.
One the main reasons our national debt has not hurt our economy as much as it could is because we're still the 'world currency'. Other countries who have debts as high as ours ( relative to GDP) have to face some hard consequences. There is an artificial need for the U.S dollar world wide because the majority of the world still does business transactions between each other in US dollars.
If this changes, and there is some evidence to support that this may happen in the future, then America will see some real consequences such as inflation and less overseas investment into our economy.
I'll try to post some links later if anyone is interested. I think one example was China and Japan talking about not trading in U.S dollars.
I agree Fox, our prosperity is precariously perched upon worthless paper, and I agree, at some point in the future, we will lose our standing.
However, as long as we maintain the strongest Military on the planet, our ownership of the world economy will continue.
I believe what we have going on is nothing short of a protectionist racket, we guarantee your safety, as long as you continue to trade in our currency.
It really is that simple...
I could not have said that any better Solar.
The main reason a currency is worth anything ( these days at least) is because of confidence in your currency. As long as we continue to be the main superpower and maintain our strong military, people will have confidence is us. Well, that's the plan anyway.
I have also been told that Saddam Hussein didn't want to trade in U.S dollars at some stage.
Another country which as been talking about changing from the U.S dollar and may have done so now at least to some degree is Iran. Not a coincident that we're talking about invading them these days.
http://www.dailypaul.com/221481/iranian-oil-bourse-will-start-trading-oil-in-currencies-other-than-the-dollar-from-march-20 (http://www.dailypaul.com/221481/iranian-oil-bourse-will-start-trading-oil-in-currencies-other-than-the-dollar-from-march-20)
It has also helped the US dollar that a lot that people have such little faith in the Euro and the European economy in general. So markets gravitate back to the U.S dollar.
Quote from: redlom xof on September 21, 2012, 07:11:54 AM
I could not have said that any better Solar.
The main reason a currency is worth anything ( these days at least) is because of confidence in your currency. As long as we continue to be the main superpower and maintain our strong military, people will have confidence is us. Well, that's the plan anyway.
I have also been told that Saddam Hussein didn't want to trade in U.S dollars at some stage.
Another country which as been talking about changing from the U.S dollar and may have done so now at least to some degree is Iran. Not a coincident that we're talking about invading them these days.
http://www.dailypaul.com/221481/iranian-oil-bourse-will-start-trading-oil-in-currencies-other-than-the-dollar-from-march-20 (http://www.dailypaul.com/221481/iranian-oil-bourse-will-start-trading-oil-in-currencies-other-than-the-dollar-from-march-20)
It has also helped the US dollar that a lot that people have such little faith in the Euro and the European economy in general. So markets gravitate back to the U.S dollar.
Yep, all of OPEC has discussed it at length, the only reason they haven't followed through, is there is not a currency yet attractive enough for them to put faith in.
Then there is still the issue with Saudi Arabia and our agreement for their protection and the fact that they carry the power in controlling the oil mkt, their word dictates and wields a lot of power.
Until China can out build our military, we will have control over the dictates of currency, this is why India plays such an important role strategically, lose them, and we lose a huge mkt of control.
Quote from: walkstall on September 12, 2012, 06:19:47 PM
My understanding we will will be downgraded again if we don't change our ways soon. :scared: :scared:
it was stated that downgrade will be tied to QE3, so when Bernanke starts buying more debt, the debt will climb higher on the ladder to get away :glare:
Quote from: gBob on October 20, 2012, 12:24:56 PM
it was stated that downgrade will be tied to QE3, so when Bernanke starts buying more debt, the debt will climb higher on the ladder to get away :glare:
This is one of the various reasons I soooo fear hyper inflation.
Which I expect to kick in when the economy begins to flourish and the rest of the world comes out of depression and begins to compete on the global mkt, our buying ability will be diminished rapidly due to inflation.
the government in one form or another is artificially propping up the GDP at a current rate of 38+% which is going to cause an immediate crash when the inflation bubble bursts :thumbdown:
Quote from: gBob on October 20, 2012, 12:41:06 PM
the government in one form or another is artificially propping up the GDP at a current rate of 38+% which is going to cause an immediate crash when the inflation bubble bursts :thumbdown:
They rewrote the laws of math in an economy that played by the rules.
Inflation is inevitable when commonsense returns to the mkt, and I agree, a crash is inevitable, but left to mkt forces can be short but painful nonetheless.
Much like GM in it's failure, there was no need for govt intervention, and the same goes for our economy, it wasn't until Govt changed the rules in buying homes, that the mkt immediately headed for bubble status and popped.
Did I mention I hate liberalism? :laugh:
the market is NOT going to correct as long as we have Hedge Funds with derivatives and no oversight - period
Quote from: gBob on October 20, 2012, 01:09:14 PM
the market is NOT going to correct as long as we have Hedge Funds with derivatives and no oversight - period
To a point I agree, but if certain aspects of the mkt are more appealing, the impact of the two aforementioned will not play as big a role in stifling our recovery.
Granted it was the leech on the back of our financial system, but it was a symbiotic relation, one that was tolerated.
It wasn't until Husein and his cohorts messed with the system that it showed it's true destructive nature.
Quote from: Solar on October 20, 2012, 01:26:06 PM
To a point I agree, but if certain aspects of the mkt are more appealing, the impact of the two aforementioned will not play as big a role in stifling our recovery.
Granted it was the leech on the back of our financial system, but it was a symbiotic relation, one that was tolerated.
It wasn't until Husein and his cohorts messed with the system that it showed it's true destructive nature.
we're not together yet Solar - it was the "R"s who prostituted the Glass-Steagall Act in the 80's and 90's, then Dodd-Frank gave complete surrender to the international banking mob in 2009 ...
in my opine, one of the very few things FDR got right was Glass-Steagall, and with that in place it would be more realistic to return to a gold/silver standard - si ?