This update posting sounds very doom and gloom; and it is. The powers that be have intertwined our economies so tightly, causing a economic detonation felt in one region of the world will have rippling impacts in other areas of the globe. The United States of America, and the rest of the world, already has its own severe economic catastrophe waiting to happen. Our government has borrowed nearly 45% of every dollar it spends to pay for its way of life.
Can you borrow that much in your own finances and expect to make it past 6 months? I know some people abuse the mess out of credit cards. The practice bad financial discipline by maxing them out and carrying the balances over to new credit cards who have near zero percent introductory rates for 6 months. What happens when no other cards will let you take advantage of that loop hole? You get stuck paying 15%, or higher, interest rates. The same thing is about to happen to our government.
The United States of America borrows, by way of selling bonds to other countries, to finance America’s government. Those rates are creeping lower right now and this seems like a good direction on the surface. But if you look at the macroeconomic viewpoint on this, that means investors are increasingly more interested in giving their money to America because they are terrified at what they are seeing over in Europe.
The Black Swan event, that should set things into motion will be the financial collapse of Europe, which will push America over the edge economically. Our way of life will change just as it did during the late 1920’s-1930’s.