Capitol Hill Blue Forums Political Issues Finance, the economy & Economics Prediction

Sorry guys, I don't see much in the future that looks quite so rosy. Rick, I cannot really say that you contradicted yourself between sentences three and four but at the very least you illustrated the precise reason WHY the worst isn't actually over.
The worst isn't over simply because both consumer AND business credit IS a monster which has only JUST begun to do the Palin-Putin Thang.

I am not a derivates expert and I neither play one on TV nor have I ever even videotaped a live one in captivity, but from what I understand of the buggers, derivatives represent wagers (Vegas style) that predict an earnings product that just doesn't exist anymore. Further, most of the companies that sold underwriting of any kind on those predictions don't exist anymore either, but the bad paper still does and that paper sooner or later becomes payable on demand.
And the pile over there, that great big one, is estimated to be something on the order of 50 to 70 trillion dollars.
At some point the indebtedness of the government has loomed so large that it cannot even collect enough revenues to pay the interest on the debt.
That's a force of nature working, and nature, be it physical and tangible in an atmosphere or invisible and magnet like, will not tolerate an imbalance.
What's coming is like a chemical reaction or a mechanical event just as sure as a sodium pellet dropped in a beaker of water or a large mainspring snapping under a load.
The equal and opposite reaction causes collateral damage of one kind or another, either physical by acts of war, political-social, economic or all three.
I predict that at some point the Tres Sec has to declare a "Force Majeure" and that steps will be taken to suddenly or gradually demonitize the dollar and even cash currency in general.
Something corporate is going to quietly assume final, total control over our government as we now know it, and there will be a financial reckoning.
Things that will go relatively unnoticed at first, like the quiet move at the county level to privatize the water system in your local municipality.
After being conditioned to believe that the move was unavoidable due to other manufactured reasons the public will be forced to accept these changes but bit by bit the actual physical assets of your town and my town will be turned into items sold to the highest bidder who then resells them to investors who hold current debt instruments.
The attempted selloff of West Coast port operations in Long Beach, CA is just the start of a long chain of sales both large and small. The actual PIECES of America are now under new ownership.
And everything in that basket of municipal owned assets is going to cost a whole lot more than a lot of people can afford.