Friday, January 15, 2010

Is America's financial collapse inevitable?

Greetings, and a belated Happy New Year to all.

Okay. It's 15 days into the month and I'm now doing my first post of the new year. There are a few reasons for that, but in a nutshell, I'll put it like this: I'm working on a few projects in 2010 that will cause me to probably post significantly less articles on this blog this year than I did last year or in previous years.

One of those projects is a separate website that I'm looking to set up, which I'm currently writing content for. I'd like that site to be completed, or at least almost completed, by the end of 2010. Please bear with me during this time, and feel free to check back for updates to this site, as I expect to still post several times a month here, especially with commentary on the major stories of the day.

Thanks to all of you for visiting, and thank you for your continued support.
That being said, my first post of the year is not a particularly cheery one.

Pat Buchanan examines the sobering question that every American should consider: "Is America's financial collapse inevitable?"

Personally I'm 150% sure that such a collapse is not a matter of if, but when. However, let the reader check out Robertson's article and form his/her own opinion:

January 14, 2010
8:10 pm Eastern

© 2010

We were blindsided. We never saw it coming.

So said Goldman Sachs CEO Lloyd Blankfein of the fiancial crisis of 2008. He likened its probability to four hurricanes hitting the East Coast in a single season.

Blankfein was reminded by the chairman of the Financial Crisis Inquiry Committee, Phil Angelides, that hurricanes are "acts of God." Financial crises are manmade. Yet Blankfein was backed up by Jamie Dimon of JPMorgan, who said, "Somehow, we just missed ... that home prices don't go up forever."

The Wall Street titans thus conceded they did not foresee the housing bubble ever bursting and they did not consider the possibility of a collapse in value of the sub-prime mortgage securities piled up on their books.

Backing up Blankfein's plea of ignorance and incomprehension is this: The crisis killed Lehman Brothers and would have killed every one of them had not the Treasury and Fed, neither of which saw it coming, either, intervened with hundreds of billions in bailout cash.

Yet there were those who warned a housing bubble was being created like the dot-com bubble; others who predicted the Empire of Debt was coming down – as, today, there are those warning that the United States, with consecutive deficits running 10 percent of gross domestic product, is risking an eventual default on its national debt.

The warnings come from the Committee on the Fiscal Future of the United States, chaired by Rudolph Penner, former head of the Congressional Budget Office, and David Walker, former head of the Government Accountability Office and author of "Comeback America: Turning the Country Around and Restoring Fiscal Responsibility."

With that share of the U.S. national debt held by individuals, corporations, pension funds and foreign governments having risen in 2009 from 41 percent to 53 percent of GDP, Penner and Walker believe it imperative to get the deficit under control. Unfortunately, it is not possible to see how, politically, this can be done.

Full article here from WorldNetDaily.

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