Here’s What an American Economic Collapse Could Actually Look Like

[tanstaafl72555]

(And How It May Be a Lot Different Than Folks Expect)


Loved THIS ARTICLE by Daisy Luther in Organic Prepper


Long and short of it was that in the USA, we should not expect a climactic whoosh bang collapse of everything so that everyone dies by the millions in a few months. Instead, Luther says we should think of it like a tire going flat, with air slowly escaping and things just looking like they are harder and harder. This is bad, in that it gives statist fools the ammo, and credibility to "fix" things by more of the same stuff, will create incentives to stir up wars to blame the foreign "enemies" and thus distract us (which may in fact lead to a more catastrophic collapse). It is interesting to consider that Venezuela and Zimbabwe did not collapse "overnight" but sank deeper and deeper to state miasma. In Venezuela, it is so desperate that the folks from the cities have begun roaming the countrysides with an agenda born of starvation and desperation. This is tragic, as I remember Venezuela as the gem of South America, with a lifestyle so superior to all the rest of South America (except for Chile). It was where the up and coming Latino professionals went to find careers in engineering, sales, accounting....., and trades.

Hard to think of us that way, but it is a possibility.

Anyway, the collapse may not come with a bang and a clash, but a series of setbacks.

The website is a good one if you like rational, thoughtful cultural and prepper analysis.

 

[Chuckman]

This has been true in just about every country where 'economic collapses' have occurred: slow and steady over time.

 

[Darkhorse]

This has been true in just about every country where 'economic collapses' have occurred: slow and steady over time.

And we are no exception

 

[GymB]

I think it’ll be a little different for a couple reasons.

First the USD is integral to international commerce. Venezuela defaulting on obligations is a modest global problem, the US defaulting will perhaps be the largest economic event in world history.

Second the US is as expert as any, and far more than most, at managing economic & monetary policy. It will apply those skills to delay the inevitable for as long as possible.

Not sure what these mean exactly for someone living in a suburb in NC/SC, but I do think the collapse will be different than what we’ve seen before.

 

[fishgutzy]

Declines are almost always caused by government action. Then they claim the need to more action to fix what they caused. Obamacare is a more recent example.
The Great depression was caused by the government. Instead of a short recession, more government action extended it for a decade. Then WWII happened.

 

[Chuckman]

I think it’ll be a little different for a couple reasons.

First the USD is integral to international commerce. Venezuela defaulting on obligations is a modest global problem, the US defaulting will perhaps be the largest economic event in world history.

Second the US is as expert as any, and far more than most, at managing economic & monetary policy. It will apply those skills to delay the inevitable for as long as possible.

Not sure what these mean exactly for someone living in a suburb in NC/SC, but I do think the collapse will be different than what we’ve seen before.

I 'think' I understand what you are saying, but do you think a collapse inside the US will be swift? I could see a meteoric collapse if Wall Street did a 1929, if something happened to suddenly stifle petroleum production; otherwise, I see gas prices more/less rising, general inflation and rise of COL, and basic goods and services outpacing income.

 

[GymB]

I 'think' I understand what you are saying, but do you think a collapse inside the US will be swift? I could see a meteoric collapse if Wall Street did a 1929, if something happened to suddenly stifle petroleum production; otherwise, I see gas prices more/less rising, general inflation and rise of COL, and basic goods and services outpacing income.

I don’t really know. If we’re forced to devalue the dollar to meet debt obligations I would expect a sudden jump in prices, but as @fishgutzy points out, the issue really starts with what the government does in response.

 

[tanstaafl72555]

I have been following Peter Schiff and Ron Paul and Doug Casey and all the apocalyptics for so long it is now baked into my DNA. In view of the above cited thing about the US being the world's reserve currency, and thus our ability to kick the can down the road, then yes, I think our fall will be characterized by gigantic events in the financial markets. I don't think that things will just sort of go down imperceptibly and we will wake up in 10 years saying "what happened?"

It is true that the longer you push off needed solutions, the worse the problem...., and the more dramatic the (imposed) solutions. I expect a lot of Wall Street lawyers and people whose living consists entirely of moving financial instruments around to come to a sudden and drastic and horrible loss of wealth. No one in their right mind will cheer that, although the thought of Goldman Sachs going under does make me smile .

All that is to say that CERTAIN sectors will be hit suddenly and dramatically, and that others will be hit dramatically and slowly. As in all financial dislocations, some will profit, though if it is severe enough, those people are likely to be lynched if they brag about it.

All I was trying to say is that I don't expect us to have a "Patriots" style implosion where things are relatively stable one week and the next six months brings people eating each other. I could be wrong, but thought the article was worth a look.

Thanks for the interaction.

 

[noway2]

At some point, I think we will see the rest of the world losing its appetite for our nation's debt instruments. As the dollars position as a reserve currency slips, this will become more likely as other countries will have less need for dollars.

Japan, one of the other reserve currencies, saw this happen. Fortunately for them, the effect was short lived.

 

[Chuckman]

At some point, I think we will see the rest of the world losing its appetite for our nation's debt instruments. As the dollars position as a reserve currency slips, this will become more likely as other countries will have less need for dollars.

Japan, one of the other reserve currencies, saw this happen. Fortunately for them, the effect was short lived.

And for a short-lived event, it was pretty devastating to the economy. They bounced back, but my goodness they took a beating there for a while.