digg

Join DiggAbout

Discover the best of the web!
Learn more about Digg by taking the tour.

Warning: The Content in this Article May be Inaccurate

Readers have reported that this story contains information that may not be accurate.
See the original image at firedoglake.com

How This Economy Is Going To Play Out

firedoglake.com — 15 preditions for the future..none of it good.

Bury
show profanity settings
expand all
  • glowgirl, on 03/09/2008, -27/+15What can we do!!
    • cageybee, on 03/09/2008, -33/+14 To prevent an economic collapse and a WWIII, US must... http://www.ronpaulforums.com/showthread.php?t=1273 ...
      • iticu, on 03/09/2008, -5/+11To be fair, one of the replies in that thread said;
        "Fix the Worthless Currency"
        and
        "Stop Illegal Immigration"

        Real experts there.
        • PhantomRogue, on 03/09/2008, -3/+7They arent totally wrong though.
          • haydesigner, on 03/09/2008, -3/+3Impossible to tell, since they offer no real substantive information about the issue or any achievable solutions.
      • xtraa, on 03/10/2008, -2/+22012: Strawberry icecream will be free for everyone.
    • Rotzooi, on 03/09/2008, -11/+43Do what I did, move to a country where the government actually works FOR the people, even in a hospital I don't have to work crazy long hours, the food is better, health care is for everyone, there are no Starbucks in sight ...and get paid in Euros. You'll be glad you did.
      • xOKxWhy, on 03/09/2008, -0/+16What country do you live in, out of curiosity?
        • cageybee, on 03/09/2008, -6/+9probably Switzerland
          • aliengoods, on 03/09/2008, -1/+16I lived in Switzerland for a few months. It did my soul some good. You should give it a try.
          • Spottswood, on 03/09/2008, -0/+20they dont use euros in switzerland
          • Charlotte_Web, on 03/09/2008, -2/+7Then why did you leave?
          • CryRightardCry, on 03/12/2008, -0/+1LOL
            Moron.
            How come people like you never go to countries that fit their personal politics better?
            You missed Stalin, but you might enjoy Russia these days.
            It's just the way you rightards are trying to make America.
        • mightycbu, on 03/10/2008, -2/+7probably the netherlands: his name is rotzooi, dutch for trash
      • cageybee, on 03/09/2008, -10/+22you know, the sad thing is that euro is heavily dependent on US economy, and if US dollar crashes, euro will go right after usd into the same direction. so, you thought you got away, but you didn't.
        • OisinT, on 03/09/2008, -4/+22the USD is crashing and the Euro is going the other way. Explain that? Also the Euro is at an all-time high against GBP also.
          • sanman, on 03/09/2008, -2/+12Umm, the Chairman of Airbus himself recently warned that for every 10 cents the US dollar drops against the Euro, that Airbus will lose $1billion. Airbus is already doing massive job cuts, and relocating factories to the US, creating jobs there. The fact is that a low US dollar is making it very tough for Europe to compete. Europe is now hollering more loudly than the US against the devalued Chinese yuan currency. Europe's Central Bank will soon have to abandon its cherished anti-inflationary policy of high interest rates, in order to stay abreast of the world. And that will lead to a gradual loss of EU centralized policy control over its special economic club.
          • OisinT, on 03/11/2008, -0/+1They're using that as a trick I think. The reasoning they're giving is almost like a magic trick. Say you're doing it to create jobs etc. so that the American public believes it's in their benefit, when realistically it's Airbus's attempt to take key military contracts away from the US company Boeing. Further, by producing in the US and paying workers in USD they save loads of money because of the exchange rate and less tax and health benefits paid out to workers. It's just the EU doing outsourcing to the US as the US does outsourcing to India/Asia.
        • stev31h, on 03/09/2008, -0/+9GBP = highly dependent on the USD

          Euro? I'd say they have become dependent amongst themselves.
          • ashwin100, on 03/09/2008, -1/+8Meh, if USD fails and in turn GBP fails then we (UK) can always adopt the Euro, and if that fails err... the zloty?
        • shrewduser, on 03/10/2008, -0/+2the world needs a nice hegemoney currency, and if the USD is seen as not so viable people will naturally move to the next best thing (the euro is the only other currency that could take over from the USD for international trade....)
        • netant, on 03/10/2008, -2/+2Also, as usual, Americans are utterly clueless, not just in their own country.

          The Europeans are not this bedrock of economic stability either. England has similar subprime problems, France teeters towards bankruptcy, and Germany is marching behind France. They are also doing more gov't spending than they can afford (Socialist welfare state).
      • DaDrake, on 03/09/2008, -0/+8What is more ironic is the latest industry standards for German economy show a slowdown. And yes... that will effect the entire economy of every EU country.
      • roho76, on 03/09/2008, -6/+20Paper money not backed by Gold or Silver is just that, Paper.
        • PaulOwen, on 03/09/2008, -2/+5roho76, you win at Internet.

          The concept of money being based on no commodity or asset is the fundamental flaw in the game. There is such a thing as a money tree - but only if you have the right "government" ink to put on the paper.

          And will be the undoing of the every fiat money-based economy eventually ...
          • sunole, on 03/09/2008, -0/+3I think that on all of earth there is not enough gold to cover the currency now in circulation, or the price of an ounce of gold would be very high. instead your $$$'s is protected by inflation if you hold them in TIPS or I-Bonds, instead of holding them at your banks, but no one dares to promote that instrument as it is against the banks and market interest, please correct me if there is a better answer.
      • glowfood, on 03/09/2008, -15/+5Socialism sounds nice to some.
        • Kerrigore, on 03/10/2008, -4/+9No, socialism (i.e. massive irresponsible government spending) is what got us into this. Responsible capitalism (i.e. limited, sensible government spending) is what will get us out.
      • raytibbitts, on 03/09/2008, -2/+9Europe is having its own, very similar problems, and the Euro floats on top of a very similar economy as the Dollar.
        Spain has increasing unemployment, a general slowdown in construction, and sky-high real estate prices, and problems with the inflation of the Euro, and is suffering from a long-term porous border, and illegal immigrants working for low wages, thus keeping legitimate immigrants salaries artificially low (virtual inflation).
        Now replace "Spain" with "California" or "The U.S." in that sentence, and you'll see there never is any real escape, plus the Socialist party just won the general elections again in Spain, so now four more years of the same.
        (¿Why did I marry a Spaniard? - oh, yeah, she's smoking hot.)
      • KazamaSmokers, on 03/10/2008, -1/+2I get the feeling Ireland is going to crash... badly.
        • OisinT, on 03/11/2008, -0/+1My dad keep saying the same thing, but I'm not so sure. There aren't too many key signs of a crash coming. I think our cost of living is out of control, but people are paying it and getting by.
    • aburd, on 03/09/2008, -4/+14I'm not saying that everything is going to be hunkydory, but this is a worst case scenario peice. I would love to know this guy's qualifications for making a large series of specific predictions. None of this is guaranteed and I would listen less to this sort of thing and more to many many legitimate economists making different predictions and reads on the state of things.
      • aukxsona, on 03/09/2008, -1/+5The guy probably has a couple of spare brain cells.
        • CoolWind, on 03/09/2008, -1/+7Maybe he should use them all. It's easy to be gloomy, but tough to be right.
      • bdbr, on 03/09/2008, -1/+6His qualifications are easy enough to find with Google. Ian Welsh has written a few papers, and written in a few blogs. He's written no books, or even articles in established economics magazines that I can tell. He has no track record of making accurate economic predictions, and provides little to no justification for these.
        • SpaceMonkeyZero, on 03/10/2008, -2/+1Then he's perfect to be a Ron Paul economic adviser. "Look Ronnie boy, I know it's never been done before... but let's tie the value of the dollar to Gold. It couldn't POSSIBLY go down from these historic highs!"
        • Kerrigore, on 03/10/2008, -1/+1It doesn't matter that he has no qualifications, because he's telling all the Randroids and Paultards what they want to hear.
        • card51short, on 03/10/2008, -0/+2"It doesn't matter that he has no qualifications, because he's telling all the Randroids and Paultards what they want to hear."

          Yes. We want to hear our money is devalued. We just LOVE it!
          Maybe you don't like it because it's not what you want to hear?
        • Joscarfas, on 03/16/2008, -0/+1I don't think you need an expert to tell you what how bad the situation is, unless you got brain and sight issues, no disrespect.
      • Locke2053, on 03/10/2008, -0/+2Exactly. He basically sets up a row of financial dominoes. If they all happen exactly according to the worst case, his predictions will be right. But if ONE domino gets moved out of place for some reason, the tumble stops.
    • TheRascalKing, on 03/09/2008, -0/+4Bail.
    • aliengoods, on 03/09/2008, -5/+16Grab your ankles and invest in gold.
      • tracywood, on 03/09/2008, -3/+9Silver is better. Easier to trade, and has far more to go than gold. I am buying $200 silver p/w.
      • Spottswood, on 03/09/2008, -3/+2pull out all your teeth and invest in gold
      • kesam, on 03/09/2008, -0/+1You would have been correct two years ago. It's too late to join the gold rush now, the prices are record high. But listen to Buffett and invest in other raw materials. Silver should work.
        • covertbadger, on 03/09/2008, -1/+1Gold is nowhere near record highs. In fact it's worth less than half of what it was in 1980 (adjusted for inflation), and silver has collapsed even more. This is why gold and silver are such atrocious investments.

          http://goldprice.org/30-year-gold-price-history.ht ...

          I really, really hope all the alarmists aren't really putting all their money in precious metals, otherwise they are going to be horribly stung next time the price caves in. Never, ever, put all your eggs in one basket when investing.
        • ronmac, on 03/09/2008, -1/+0I agree with not all eggs in a basket...but if there ever was a time for gold/commodities, this is it.
      • slezzzter, on 03/10/2008, -2/+1Not according to the article. This guy goes on an FDR tirade, without mentioning that FDR took the US off gold in the first place and even went so far as to confiscate it. Gold's a dangerous investment with a socialist in the White House.
    • sanman, on 03/09/2008, -0/+5Did it say predictions or predations? j/k
      Well, the "commodities bubble" -- the inflation of commodities prices, including oil -- will help to herd people towards greater efficiency, such as alternative energy technologies, and so that would be the best area to invest in, since high energy prices will only make their appeal grow.
      And then the environment will be the winner, as these new technologies come into their own and sustain their own growth and evolution.
    • DesignEx, on 03/09/2008, -2/+6Get rid of your fiat, and pick up some silver and gold, otherwise any savings you have aren't safe.
      • CroMag, on 03/09/2008, -2/+14Oh, but Gold and Silver are? LOL. Believe me, the only commodity that will matter in the doomsday scenarios that diggers have such a hard-on for is WATER.
        • DesignEx, on 03/09/2008, -0/+1I live on a lake, I guess I'll be rich! LOL.

          The current topic is the fall of the USD, the question asked what to do to avoid going down with it, and I answered it. The answer is a little different for doomsday scenarios, yet even then a semi-rare/compact form of currency might still be needed.
        • ronmac, on 03/09/2008, -2/+0OK, yes you must have water, but after that some food, warmth, and the ability to trade for a few other baubles will come in handy. And that will require some trade, and that will require gold, silver, oil or something other than paper.
        • dafragsta, on 03/10/2008, -0/+4He's not talking about doomsday scenarios. Diggers are far too grandiose at times. The reality is not about doomsday. The reality is somewhere between 1929 and the 1970s. This will probably not affect the world quite as much as the great depression, but you CAN marginalize the damage if you have a retirement plan and if you can move it over to silver and gold based funds. Those things will always be in demand after the world gets over itself and realizes the economy is an imaginary thing based on constraints we invented and can control if we decide it needs something resembling a reboot. If every last being on the planet wanted it, we could start back at 0 financially tomorrow, and then what? Would we all of a sudden not have the buildings and houses and resources we've developed? no, it'd still be there, but this psychological shock about the arbitrary nature of oen of the most driving forces in humanity would be disillusioning to the extremely rich who would then have nothing over their fellow human beings, except solid assets. Their cash exists in a state of illusion that we just all accept as a law of the universe.
          • netant, on 03/10/2008, -0/+1The extremely rich would not be disillusioned. The extremely rich do not keep a large percentage of their assets in cash. That means they'll still own all the property (God isn't making more real estate), factories, housing, raw materials, farms, water. They don't need money to exert control.
    • Corman420, on 03/09/2008, -3/+12Pay your dept...
    • Teckla, on 03/09/2008, -18/+26STOP VOTING REPUBLICAN.
      It's not like we didn't warn you this would happen!
      • DigginOnYou, on 03/09/2008, -23/+10YEA VOTE DEMOCRATIC SO THEY CAN RAISE TAXES AND THE RICH GET PISSED AND CUT JOBS AND RAISE UNEMPLOYMENT AND WE DIG OURSELVES A DEEPER HOLE!!!
        • CoolWind, on 03/09/2008, -4/+11geez, calm down. it's not like you're probably right. can't you see what Bush and the other Republican villains have done?
          • DigginOnYou, on 03/09/2008, -7/+1well im not for bush im just saying, dont point the finger at the republicans...we knew this problem was coming well before bush was in office....the baby boomers change in spending habits when they retire....the sub-prime housing that puts millions out of their homes...none of those things were bush's fault ....many things helped...like getting caught up in the ***** over seas. go ahead and vote democratic....but in 4 years when we are on here talking about the crushed economy and how obama ( or clinton but i doubt it) didnt hold to their word to fix it... dont get pissed when i say i told ya so.... neither republicans nor democrats in this race have the ability to stop whats going to happen....
          • nirav72, on 03/09/2008, -1/+7@DigginOnYou - It is partly Bushes fault. He kept pressuring the Fed to keep lowering interest rates instead of worrying about inflation back in 2002. That led to abundant cheap credit available and thus you have the whole sub-prime mortage mess that we're in now.
          • DigginOnYou, on 03/09/2008, -4/+0to nirav72.....so what is you're solution to inflation
          • DigginOnYou, on 03/09/2008, -4/+0it was the banks fault....lower intrest rates would have helped...but the banks feared losing money so they (like countryhome loans) gave adjustable rates...so people got into houses they thought they could afford...but when their rates started to go up they were forced out of their homes....what did bush have to do with that??
          • nirav72, on 03/10/2008, -0/+1"to nirav72.....so what is you're solution to inflation"

            Right now there isn't any. Back in 2002, the fed and Bush admins should've watched it a little closely and kept a happy balance. But its all about the votes and approval ratings. So knee jerk reactions are common.
        • nicktx, on 03/09/2008, -2/+7If you bothered to look at US deficit, debt, and employment numbers in the past 30 years you will realize that the only time the economy was truly good was while having a Democrat in the office.
        • bejayel, on 03/09/2008, -0/+5Higher taxes is exactly what yoru government needs to get some more money in their accounts. If you dont have higher taxes from any party next year, i would be extremely suprised.
        • DigginOnYou, on 03/09/2008, -2/+1http://blog.u4prez.com/2008/03/04/the-pillars-of-t ...

          this is already posted on digg....read up
      • RomeyRome, on 03/09/2008, -8/+3I'm voting republican! I have money tied up in gold & silver. Self serving...I know.
      • d03boy, on 03/09/2008, -4/+1you're kidding right?
        • icole1990, on 03/09/2008, -2/+5Im voting Democrat, but Demos got us in to this mess in the first place. FDR's programs are the root of most of our problems. We cant keep subsidizing all of our programs. We need to get rid of the IRS and other govt organizations that are tying up our funds. We also need to allow competition in the Federal Reserve. We need to have a non interventionist policy, and NO universal health care.
          This is far from Liberal, exactly opposite actually.
      • ronmac, on 03/09/2008, -5/+2Yeah because the Democrats weren't in on any of this. They are all idiots, and don't quote me something about a surplus with Clinton...remember the purse strings are with the Congress. And his Congress was Republican.
    • nastronomical, on 03/09/2008, -2/+7Well you can start by getting educated in the area of economics, yes its that simple. A education can open your eyes to the utter crap spewed by idiots who write blogs!!
    • saintamour, on 03/09/2008, -10/+17I'm going to tell you a secret. There's not a difference between Republicans and Democrats. Gasp
      • CoolWind, on 03/09/2008, -13/+8Wrong. Repubs represent the wealthy and powerful. Dems are more concerned about the middle class.
        • aaoral, on 03/09/2008, -2/+11Wrong again, both parties are controlled by the rich and powerful and big international corporations. American government is hardly about the people anymore. Do some ***** reading and ignore the crap that politians and mainstream media throw in your face and try to read off the main trail. You'll find that alot more things make alot more sense.
          • Antwan718, on 03/09/2008, -1/+5You still need to have SOME input from the mainstream media, just take it with a grain of salt.
        • Akronos, on 03/10/2008, -0/+5Haha, Coolwind's post reminds of something I would say back when I was ignorant and just accepted everything my teachers or the media told me.
          If you think either party represents you, at least on a national level, you are wrong. Republicans represent elitists and corporations. So do the democrats.
        • SpaceMonkeyZero, on 03/10/2008, -0/+3Both parties ***** the middle class. They just do it in their own way. One's rape, and the other is date rape. (I'm not going to speculate which party does which...)
          Either way you're screwed.
      • nicktx, on 03/09/2008, -3/+9If you really think that you need to do some research. Neither party is great but the GOP is mainly led by war mongers, bigoted religious zealots, golden parachute corporate shills, in-the-closed gay bashers, and the list goes on.
      • ronmac, on 03/09/2008, -1/+5That is the most clueless comment I have heard in a while...they are BOTH concerned about themselves and their power...
    • Whippets, on 03/10/2008, -2/+2Die.
    • BESTenemy, on 03/10/2008, -1/+1What can we do? Well... how about honoring the debts and learning from our mistakes in order to prevent similar debts in the future?
  • StingingNettle, on 03/09/2008, -35/+96I predict people having to flee the suburbs in the U.S. because they can't afford (or their isn't any) gas, they don't have a job, or food so they volunteer to go into a Halliburton internment camp for the rest of their lives. The city will have long soup lines and will be in an awful condition to live but it will be deemed "safe" by the government (with their street cams). Those struggling to live outside will be called terrorists and will be forced to learn how to live with nature again (while they trying to avoid being stocked by government satellite). But hey I'm a optimist. Its my Sagittarius nature.
    • clearzen, on 03/09/2008, -2/+38Then Mad Max will rise from the "outlanders" to unite them against the evil city dwellers.
    • Timetheos, on 03/09/2008, -1/+25No, you'll see busses rise in popularity. In fact, I am already seeing that.
      • browwiw, on 03/09/2008, -1/+13I'd love to see a train transit system here in the US like they have in most of Europe. I'm especially fond of the French model. You can get practically anywhere in France is just two or three train stops.
        • stev31h, on 03/09/2008, -0/+23they are 1/20 the size of America, but nonetheless, highly populated areas should have better options.
        • 11b1p, on 03/10/2008, -0/+2The paris train and subway system is ***** magnificent.
      • 15charmaxwtf, on 03/09/2008, -0/+12A victory for public transport!
    • Hoogie7Dowser, on 03/09/2008, -1/+14Awesome! I can't wait! Halliburton Gruel (TM) tastes Mmm mmmm GOOOD!
      • sanman, on 03/09/2008, -0/+7Halliburton Gruel is... PEOPLE!!!
        • mexicanman07, on 03/09/2008, -0/+7 it varies from person to person
      • hamobu, on 03/09/2008, -0/+2Dugg up for obscure Sci-fi reference.
        • sekhui, on 03/09/2008, -0/+3that's obscure?
          • hamobu, on 03/09/2008, -0/+1Are you refering to the movie Soylent Green, or to Futurama?
          • sekhui, on 03/10/2008, -0/+1soylent green. that's where it started, after all.
    • nastronomical, on 03/09/2008, -13/+8So your "prediction" comes about because you read a blog? Hey i read a blog that aliens are gonna invade the earth and they look like lizards...is that valid and true?
    • esteskid, on 03/10/2008, -2/+1I for one can't wait until government satellites start investing in those struggling to live outside
    • mchugh22, on 03/10/2008, -11/+4Who is this fagot and why is he talking about economics.
      1. Yes, the united states is entering a recession
      2. No, if we have stagflation we aren't in a recession we are in a serious depression
      3. WRONG about protectionism, as the American dollar gets weaker American goods get "cheaper" The U.S> will buy more U.S. goods and export more.
      4. OIL will drop- WRONG. demand will continue to increase.

      The United States is going through a minor recession however if the U.S keeps this level of spending for too long (100 or so years) it wont be able to pay the intrest on its loans and provide public resources. Then the U.S will collapse.
      • kickelephant, on 03/10/2008, -1/+7I stopped reading your crass post after you spelled "*****" wrong. Get a clue and join us in the 21st century :)
      • MSweerts, on 03/10/2008, -1/+2How did you discern that this person may be a fagot [sic], and could you provide an updated definition of that term, lest we misunderstand?
      • aeon2012, on 03/10/2008, -1/+7What kind of American goods are you talking about? The ones that are made in China?
      • Cybrwolf, on 03/10/2008, -0/+1What goods??? We don't freaking make anything anymore!!!!
    • xlar54, on 03/10/2008, -2/+6You know what... Im rather proud of the people on here and elsewhere.. people are coming to the realization that credit is a BAD thing. Ive been involved with the Dave Ramsey method of personal finance, and folks...it works. Getting out of debt is the greatest thing you can do for yourself, and your family. Never getting in to begin with is even better. Dave likens going into debt as becoming a slave to a master. And a FICO score is just a score of how good a slave you are. But again, I look around and read various things, and I see more and more people coming to the same realization. Everyone I talk to about this tax "rebate" all say they are going to use it to pay off debt or save. It wont help the economy like Bush thinks...but I think people dont care to help the _economy_... they want to help make their lives better. Stay away from credit, pay cash for everything you can, get an emergency fund up and running, sell some stuff, deliver some pizzas, and get out from being a slave to a master. Before you fill out that credit card application, remember you're really signing on to letting people call and harass you all hours of the day. You're promising to pay when you really have no idea if you'll be able to pay - who here knows what tommorrow will bring? You cant count on your job being there, but you sure as hell can count on them bugging you to no end, and charging you out the ass for late and non payment. Dont buy new cars, save and buy a used car where the depreciation has already occurred. If you've never heard of Dave Ramsey, look him up on the net. The guy *makes sense*. And for parents - start teaching these principals to your kids while they are young - that credit is BAD. Let them understand that credit is synonymous for "I cant afford it". Do them the biggest favor you can as a parent - teach them to avoid the same hell we have all been through.
      • scamper22, on 03/10/2008, -5/+3"You know what... Im rather proud of the people on here and elsewhere.. people are coming to the realization that credit is a BAD thing"

        what are you a muslim now? Only Muslims ban interest and credit. Well the bible does do, but what does christianity have to do with the bible
    • Lanlost, on 03/10/2008, -0/+3This is one of the best comment posts I have read on this topic in a long time. Being in debt (not college loans...) sucks at 23.. try $25,000 and having to drop out of college. I really am too smart to be this stupid, and so are most of us on here. But then again, before I got into debt I really had no idea how bad it would be once I was in it. I have spent the last 2 years reading about economics and personal finance and.... I couldn't have done more things wrong. I suppose it's better to learn now when I'm young and can fix it then never though. You read a bit and you think you know.. and then you continue to read and realize.. like any other subject, it goes 10 times deeper than you ever thought it did.
    • vbullinger, on 03/11/2008, -0/+1Tell us how you really feel.

      You really shouldn't sugar coat things. No one will get what you're implying.

      You didn't mention the North American Union, the Amero or the inevitable invasion of Iran (even after our fixed elections go to Obama or Hitlery. If it goes to McCain, then you KNOW it's completely rigged. And I'm a Republican - who will not vote for McCain... or Obama or Hitlery, for that matter). Lindsey Williams will fill you in on that inevitability: http://video.google.com/videoplay?docid=3340274697 ...
  • EvilAnimator, on 03/09/2008, -84/+19THE SKY IS FALLING! WE'RE ALL DOOMED!!!
    More propaganda from liberals just trying to scare America to win in November.
    • outkaster, on 03/09/2008, -6/+40And another person pointing the finger across the isle when it is everyone who is at fault.
    • fancypantscz, on 03/09/2008, -3/+37I don't think anyone reading this article in their right mind is going to come away thinking that a vote for the democrats this is going to fix this situation. It was decades of collusion between the two parties and big business that got us into this mess and it is partisan hacks like EvilA who will ensure that things get a lot worse before we are able to make any substantial change for the better.
    • CroMag, on 03/09/2008, -9/+12I love how this guy is buried, but a guy saying we will be in Halliburton Concentration Camps has 14 diggs.
      Further proof that when the pendulum swings so far in one direction as it has with this administration and culture surrounding it, it will swing just as far to the opposite. The "right wing kook" has met it's antithesis and it's here in full force (denying all the way that it exists).
      • CoolWind, on 03/09/2008, -2/+4Realistically it could be Blackwater concentration camps, except they'd probably just as soon shoot you as put you to work.
    • LBobRife, on 03/09/2008, -10/+9I consider myself liberal and I find this article a load of BS. Predicting the future of economics is like predicting the weather. You can do it accurately for short periods of time, but the further you go out the more the small errors you made in the start matter. You will never see many of the "predictions" outlined here.
      • CoolWind, on 03/09/2008, -2/+3I agree. But you're getting dugg down. It's easier to think negatively than positively.
      • zigurd, on 03/10/2008, -0/+4You are in denial. Most of these supposedly "dire" predictions are in the "duh" category. Like Fannie and Freddie needing bailouts in a real estate crash when the mainstream financial press has been editorializing about the dangers of these institutions for years now. Duh! It's going to get worse. Maybe a lot worse.
    • nastronomical, on 03/09/2008, -14/+1Thats the best they can do. notice libs stay far from logic and rationale thinking? Just keeping asking for the facts and use logic, they will burst a fuze and crumble like cookies.
      • CoolWind, on 03/09/2008, -0/+8We've all noticed how logical and rational the Repubs have been.
    • enki25, on 03/09/2008, -0/+10What's more realistic, that some homeless fundamentalists in the middle east will invade America and institute sharia law? Or that the economic tricks all of us have been pulling for the last 20 years are about to come back to bite us?

      No, Republicans are the only ones using fear mongering to try to win in November. This article is not the Democratic position, it's just a hard look at the future if no changes are made.
    • kaelyiesta, on 03/10/2008, -2/+2That doesn't make sense. If anything this would be a warning against less fiscally wise candidates. Obama has one of the most unbalanced budget proposals of any candidate so this is no way could be scare tactics from his fans.

      http://www.ntu.org/images/2008pres_total.png
  • MyBookie, on 03/09/2008, -28/+114I sure wouldn't want to be running for president now. Whoever wins will have to fight being blamed for this mess. I don't think a democrat is the answer because the thrive on spending, not saving. I don't think a Republican is the answer, because generally they will want to continue the costly war in Iraq which is really going to bankrupt the U.S. I even think it may be too far gone for even someone with ideas like Ron Paul to save. It's pretty sad.
    • cageybee, on 03/09/2008, -6/+11if we buy gazillions of rubles right now while they are cheap and if we help Russia make Russian Ruble a world currency - we will be a very rich country and will not have to collapse economically
      • SwiftKick34, on 03/09/2008, -14/+13In Soviet Russia, currency buys YOU.
        • sum33t, on 03/09/2008, -7/+15Good lord, let this joke die already
        • jnosanov, on 03/09/2008, -4/+11In Sovient Russia, jokes kill you!
          • Lone1, on 03/09/2008, -1/+3technically, that should be "joke lets you die". If you had been paying attention in Soviet Russia Joke class you would know that. Commander Bob will not be happy with you comrade.
      • jnosanov, on 03/09/2008, -1/+6lol
    • darkane, on 03/09/2008, -15/+3So you're saying that we don't want a Democrat because they'll get us out of the war and spend that money on other (likely domestic) things, that we don't want a Republican because they'll keep spending all that money on the war, and that Ron Paul is the only person that has 'ideas'? If that's how things really were, it sure sounds like we'd be *****. I guess it's a good thing that you're wrong, huh?
      • tracywood, on 03/09/2008, -6/+13Actually I think Ron Paul's right on the money. Pun intended,
        • darkane, on 03/09/2008, -7/+5Congratulations. Do you want a cookie?
        • specialK16, on 03/10/2008, -1/+1@darkane: You don't know what you are saying. I suggest you try reading MyBoonkie comment again and again until you can make some sense.
    • lendrick, on 03/09/2008, -12/+37Democrats thrive on spending, not saving? The Democrats were responsible for the first (and only) budget surplus in ages. And as much as people like to talk about how taxes make a mess out of the economy, all recent evidence points to the exact opposite.
      • xerigen, on 03/09/2008, -2/+12Bill Clinton was a fiscal conservative for the most part.
        • cliffzdude, on 03/09/2008, -1/+3No *****, increasing taxation is the key feature of any fiscal conservative.
          /sarcasm
          In all actuality, clineon was held tight by an opposing House and Senate. Not to give Republicans any credit, no way. Regardless of what "side" you fall on, if you understand our Federal Government you will always hope and pray that the Executive and Legislative branches are not of the same party, otherwise they get drunk on power and spend like drunken sailors.
      • mtekk, on 03/09/2008, -8/+6The surplus during the Clinton era was caused by the tax influx from the introduction of the Roth IRA, where the tax comes out first, and many people were converting their IRAs.

        Take a macro economics class and you'll see how absolutely wrong you are.
        • gak001, on 03/10/2008, -2/+3Wow, we have someone who took one macro course and thinks he's an expert. Economics 101 and 102 can be used to support either side of an argument. When you get into the higher courses, you start to realize that maybe Colbert was right - reality actually does have a liberal bias.
      • cliffzdude, on 03/09/2008, -4/+14I logged in just to reply to this inaccuracy. There never was a surplus. None. Zero. Nada. Not even a projected-someday-would-be-surplus. There was a projected surplus, in the FUTURE, based upon invalid growth rates and invalid (stagnant) spending rates. In other words, the Clinton "surplus" was but a so-called projected surplus, saying that if growth continued (think Dot-Com Bubble Era) and government spending stayed the same, there would someday be a surplus. to lendrick and the (currently) 14 people who dugg his comment up, you really need to learn what's behind the ***** that any politician is spewing. Don't take my comment as anything but a friendly piece of advice, I'm not trying to insult you or flame-bailt. Quite the contrary.

        Ignore me, read the numbers:
        FiscalYear
        ----------Year Ending
        ------------------------------National Debt

        FY1993 09/30/1993 $4.411488 trillion
        FY1994 09/30/1994 $4.692749 trillion
        FY1995 09/29/1995 $4.973982 trillion
        FY1996 09/30/1996 $5.224810 trillion
        FY1997 09/30/1997 $5.413146 trillion
        FY1998 09/30/1998 $5.526193 trillion
        FY1999 09/30/1999 $5.656270 trillion
        FY2000 09/29/2000 $5.674178 trillion
        FY2001 09/28/2001 $5.807463 trillion
        • Lone1, on 03/10/2008, -7/+3look at your chart there from 99 to 00, the debt went up by 18 billion. Clinton was well otw if not actually achieving a balanced budget. What is the deficit now? What is the debt now? Why not extend your chart out into the Bush years?

          you are busted. Bush= Epic Fail.
          • ratpH1nk, on 03/10/2008, -0/+3@ cliffzdude, look at this, the 1trillion surplus was projected, but not the 1998, 1999, 2000 years, that was real surplus.
            "President Clinton announced Wednesday that the federal budget surplus for fiscal year 2000 amounted to at least $230 billion, making it the largest in U.S. history and topping last year's record surplus of $122.7 billion."
            "In June, the administration predicted the surplus would be $211 billion, and would increase by as much as $1 trillion over the next 10 years."
            "It is the third year in a row the federal government has taken in more than it spent, and has paid down the debt. The last time the U.S. government had a third consecutive year of national debt reduction was 1949, said the official.
            The federal budget surplus for fiscal year 1999 was $122.7 billion, and $69.2 billion for fiscal year 1998. Those back-to-back surpluses, the first since 1957, allowed the Treasury to pay down $138 billion in national debt."

            http://archives.cnn.com/2000/ALLPOLITICS/stories/0 ...

      • peestandingup, on 03/09/2008, -0/+2He meant historically. Not that that makes much difference now. Both Demarcates & Republicans have shifted from what they once were.
      • gak001, on 03/10/2008, -2/+2Between Tax & Spend Democrats and Borrow, Borrow, Borrow Some More & Spend Like There's No Tomorrow Republicans - I think I'll take the former any day of the week. Keep in mind, when we borrow, we're selling America to China and Saudi Arabia a little piece at a time.
    • iroc409, on 03/09/2008, -18/+7The war isn't going to bankrupt us, social programs are what is doing us in. Take a look at our budget. 2008, for example, is about $3 trillion. Over half of that is spent on social programs.
      We spend more on just social security than we do our entire defense budget (which includes the war in Iraq) and the "war on terror". Social security is around $600b, and BOTH the WOT and the defense budget is about $550b.
      Our inability to take care of ourselves, our incapacity to take responsibility for ourselves, and our outright demands for the government to pay for our hideously poor financial decision making is what is bankrupting us. Our refusal to pay a few bucks more for something that was made in the USA by hard-working US citizens is going to doom us. At least we're trying to save some of that unemployment check by buying WalMart instead.
      Your kids are your responsibility to raise. Your poor financial decisions are yours to repay. Your health is yours to take care of. The plan to privatize social security probably could have nearly single-handedly saved this country, but now we are promising more and more payments, with fewer and fewer citizens contributing.
      • aukxsona, on 03/09/2008, -13/+4All very true.
      • CoolWind, on 03/09/2008, -1/+4Do you have any idea how much money was stolen from paychecks to fund social security? It's not like it's free or something. All that money could have been used to fund investments. Not many people actually wanted all of that money taken out of their pockets. But now that the damage is done, you want to reverse it and let people take care of themselves. Thanks for your concern.
        • Antwan718, on 03/09/2008, -3/+3So let me get this, you expect a base of 100 people to pay for the retirement of 130 people, he is right the social security industry needs to be stopped now. Welfare alone is a major problem no one wants to intervine with.
          • Lone1, on 03/10/2008, -1/+2I'm sure it will be no problem when the money taken from the SS surplus for all these years will be paid back. If you don't think it will be then maybe you should realize that this was a giant transfer of money from those who pay payroll taxes and those who don't.
      • bluesnowmonkey, on 03/09/2008, -0/+3The social security money was stolen and spent. It's gone now, and there's no getting it back. Continuing the handout system that facilitated the theft will not in any way undo it. Along the same lines, continuing the Iraqi occupation will not help anyone in the long run. The sooner we discontinue both endeavors, the better off our children will be.
      • Lone1, on 03/10/2008, -1/+4SS is paid for by SS taxes, that "social program" is and would have no problem if those taxes would not used to subsidize the rest of the government.
    • ScottMitchell, on 03/09/2008, -2/+4As much as I abhor reckless spending, I'd rather have money recklessly spent on building our nation's infrastructure and feeding our nation's hungry than fighting an injust war halfway around the world.
      • Garbagio, on 03/10/2008, -0/+1Funny how people STILL prefer 'doing without thinking' on one angle and completely abhor 'doing without thinking' elsewhere.
        Git yerself sum edumacation and dont settel for the not so guud.
    • bdbr, on 03/09/2008, -1/+5Actually both parties thrive on spending. There are few economic conservatives left. The Democrat model is tax & spend, the new Republican (neo-con) model is borrow and spend. Huge difference on what they spend on, of course - Democrat focus is domestic, Neo-con focus is imperialism. Ron Paul was the sole economic conservative in the race, and Diggers were forgiving a lot of social conservatism (anti-abortion, etc) because of that.
    • Amnesia10, on 03/10/2008, -1/+5Ron Paul was right that the US economy needs to live within its means. That means tax increases and government spending cuts. Huge spending cuts. That means pull out of Iraq and raise energy taxes to slow energy imports and to encourage investment in renewables and energy effiency. That means people also living within their means, clearing debts not borrowing if possible. This will mean short term pain but am sure that the US economy will recover as long as these property and debt bubbles are lanced.

      Here in the UK we have the same problems, even to a greater extent. Also this was brought on everyone by politicians wanting a growing economy to win elections. We even had the now Prime Minister saying the "end of boom and bust". Only problem was that recessions are necessary to adjust the economy every now and then. The longer that they are put off the worse they are. this one will be a doozy.
      • Garbagio, on 03/10/2008, -0/+1I just hope here in Canada, we don't feel the earthquake as hard as our neighbours.
    • CalamariAce, on 03/10/2008, -0/+3The mess we're in is more than 1 any person could hope to change before we start reaping some of the larger consequences from decades of negligence and incompetence. Even given the most optimistic presidential results, you still have a congress that on the whole will sell your liberties away for a dime, and you have centralized banking controlled by third party interests interested in globalization regardless of whether that means conditions in America improving or deteriorating. It took a long time for conditions to deteriorate to what they have become, and even with optimistic conditions it will take us a long time to restore former conditions.
      • Garbagio, on 03/10/2008, -0/+2I imagine Congress doesn't seem to be left with much choice. Although, their voting on shifting power to the president to declare war was arguably the most boneheaded error in the Senate's recent history. Since the execution of the Patriot Act and the Military Commissions Act, the Executive branch has been usurping power above the Judiciary and the Senate; The Senate has had to fight for viability. In the world of business (and make no mistake, politics is business), if the position you hold isn't necessary, then it's wasting time and money. On a more personal level, if you aren't getting voted back in, you aren't securing your future. Quite the conundrum.
      • Garbagio, on 03/10/2008, -0/+3Also, as another note, the country won't ever make it back to how it was. Due to two aspects; One being the international representation and military alliances. The other being the enforcing of the paper money system that is backed by trading oil in US paper dollars. In essence, what used to be backed by a universally valuable metal has shifted to another precious yet quite limited resource. The US government is forcing a counterfeit currency to be 'valuable' by forcing countries either through sanctions or through muscle to trade oil in US dollars. This way the US gets oil at a large discount to other countries with the controlled fluxuation of the dollar.

        The kicker is that all the prosperity is built upon the ignorant/fear-based illusion that the dollar is able to retain the promised value. The world is wisening up and it truly won't be long now. If Ron Paul is voted in, he may have a way to control the way in which the US dollar falls out of style. If McCain or Obama is voted in, the dollar will continue it's current trend of remaining viable until the rest of the world calls in its debts which will result in a crash that will prove catastrophic for the poor, middle-class, and the rich with high risk ventures in dummy trading stocks.

        What the Senate does with your liberties will most certainly be one of your least concerns should you be unable to leave where you are after an economic collapse. The loss of your civil liberties will go completely hand in hand with the economy if the blow isn't cushioned early.
    • Garbagio, on 03/10/2008, -0/+1While I'm at it, here's another tidbit I forgot to mention.

      Iran wants to trade oil in Euros
      Venezuela want to trade oil in in other currencies, mentioned the Euro

      Venezuela has been attacked by Columbia on the border and the Columbian diplomat expelled (just recently allowed back) after a peace accord was reached. All before Venezuela is scheduled to drop the US Dollar in favour of the Euro for their oil trade.

      These two are both under fire by the US media and the Bush Administration. All under the guise of terrorism. Be willing to believe the unbelievable and use your ability of 'innocent perception' and always ask why.
  • MuletTheGreat, on 03/09/2008, -13/+31Meh.
    • Largent, on 03/10/2008, -1/+2Nothing like random douche bags spreading their infinite wisdom on the complex world of economics and having that digital fecal matter dugg to the front page, well done folks.
  • LarryLacuna, on 03/09/2008, -5/+6It's like an optical illuuuusion.
  • tekhna, on 03/09/2008, -10/+122I'm no optimist, but I feel like perhaps some of these predictions are a touch hyperbolic.
    • SuperWinner, on 03/09/2008, -3/+18a tad pessimistic too, things will be bad in the next 4 years but not quite as bad as this article states.
    • Beveridge89, on 03/09/2008, -0/+8I do notice i've yet to see a link to the economist, which predicts a low growth year for the US. Perhaps its just a bit to optimistic for diggers after seven years of Bush.
    • Corman420, on 03/09/2008, -5/+12Not near as bad. lol. This is a really innacurate article. Some noob wrote it...
      • MSweerts, on 03/10/2008, -0/+0mchugh22 says that this noob is also a fagot [sic]. Please see above post.
    • Thud, on 03/09/2008, -3/+7Isn't a recession defined as two consecutive quarters of negative economic growth? The growth of the economy is slowing, but so far has not experienced negative growth. But the author sees fit to declare that we are already in a recession.

      Wow, it must be an election year. I guess we had better vote for democrats.
      • jim3008, on 03/09/2008, -0/+5technically, we aren't; but in reality we are, that's why many economist wants to redefine the word recession
        • bagelmaster, on 03/10/2008, -4/+2What you said in the beginning of that made no sense... we either are or aren't in a recession. There is no technically about it, it's pretty black and white.
        • kpaphysicist, on 03/10/2008, -0/+5Jim's statement made sense. He's saying that according to data available right now, we aren't in a recession technically. But, many economists are saying that we are in a recession even though the immediately available data does not portray it. So there is a grey area due to the availability of data. We'll know for sure in a year or maybe less...
    • bdbr, on 03/09/2008, -1/+1I looked around to see what Ian Welsh has accurately predicted in the past, and as it turns out he's only been writing papers for a few years now, and doesn't have anything published in any economic journals that I can find. This is just one inexperienced professor's guesswork.
    • eclectro, on 03/09/2008, -3/+3I actually buried this story, because it ignores some ingredients. The fact is that the economies of the states are as large as some other countries. There will be a slowdown and bank failures, but that doesn't stop people from buying/trading/acquiring/needing stuff. Another thing, this article sounds too much like something that came from a Ron Paul fanatic.
    • MutatedNantuko, on 03/10/2008, -2/+2Stock drops 10 points: APOCALYPSE!
    • mGARANDEUR1, on 03/10/2008, -2/+1However it plays out, it is Bush's fault. It was raining this weekend, which I blame on the president. It's all his fault. My car is also having problems. If Bush didn't lie to the American people, it would still be running fine.
    • Lanlost, on 03/10/2008, -1/+0Sorry to sound pessimistic but I really find it hard to believe that 90% of you have actually researched enough to make predictions that are more credible than any of these articles.

      Oh sure.. digg me down. It's still true.
  • CanIGetAWitness, on 03/09/2008, -9/+6Hard hitting.
  • UltramegaOK, on 03/09/2008, -7/+81Now I need some Lolcats to cheer me up.
  • maninblac1, on 03/09/2008, -7/+44These predictions are all, very possible if you're are of the belief that the economy will be crushed under the inflation of the last 7 years. Which is a reasonable point of view. As the average consumer's budget gets tighter with inflation, you'll see more conservative spending, which will bring prices and profits down, which means layoffs and downsizing to keep profit margins and wallstreet happy.

    But just that snowballs, because as people get laid off, they get even more spending conservative, and then the government must come in with unemployment checks to save the people, which begets more inflation which makes prices rise, which exacerbates the problem.

    If we want the economy stable, we have to solve the inflation problem, which means we have to solve the national debt, the budget deficit, and over spending. The dems will win, which is ok, but it's a bad bad time economically for a democrat to be the president.
    • hamobu, on 03/09/2008, -2/+3What would be worse: Inflation or the credit crunch?
      • nirav72, on 03/09/2008, -0/+3Inflation would be worse for the average consumer. Credit crunch would be bad for businesses who need the money to expand. Its a bad situation either way. I'd still pick inflation as being the worse.
        • hamobu, on 03/09/2008, -0/+1I do not know if I agree with that. The great depression of 1930's was a credit crunch. During the credit crunch:

          1. productive assets are unused,
          2. Everybody wants to work, but there are no jobs.
          3. And because there are no jobs, people do not have money to buy stuff,
          4. Because people are not buying stuff, nothing is being manufactured.
          5. And because nothing is being manufactured, there are no jobs and assets are unused.

          It is as if you take all the money out of economy and trade is impossible.
    • darkane, on 03/09/2008, -9/+12Do you know what the real downfall of this country will be? Horrific comma usage.
      • maninblac1, on 03/09/2008, -1/+9The comma splice is my friend, that way i don't have think in complete sentences :-D
    • tdog138, on 03/09/2008, -1/+16Yeah, because that Republican president really did a lot to help the national debt. Wait a minute...
      • maninblac1, on 03/09/2008, -4/+5Democrats are tax and spend. They will not address the national debt, whatever surpluses are gained from not renewing the tax cuts in 2010 will be immediately spent on their pet programs for healthcare and education.
        Republicans, if willing to balance the budget (which they aren't cause they don't want to tax anyone), and with consistent warmongering, not likely to be balanced anytime soon. Otherwise they would be willing to address things like the debt and other unnecessary spending (no child left behind).
        • phr0stbyte, on 03/09/2008, -0/+3So we have a democrat for 4 years who gets us out to the war and then a republican to come in and fix the debt problem since they won't be in a position to keep bush's policies intact.
          • maninblac1, on 03/09/2008, -0/+2The lower middle class doesn't have 4 years to wait.
          • Antwan718, on 03/09/2008, -0/+2You act like there is a difference between democrat & republican, either way they are all in the greater category of POLITICIAN: lie to the people that think they elect you and then do as you please for the real people that elected you.
        • WasabiBomb, on 03/09/2008, -0/+2I'm always vaguely amused by people who describe Democrats as "tax and spend"... as if that's necessarily a bad thing. If there's anything that the last 7-8 years have shown us, it's that Republicans are "spend and spend". That just seems worse, to me.
          • Memitim, on 03/10/2008, -0/+3Eventually we'll need to cut the spending to the bone or jack the taxes up sky high. Any of us who have gone through a period of living beyond their means knows what that's like, and those of us who have fixed the damage done knows how much it sucks to get it fixed. But it has to be done. We owe it to future generations to let this snowball of debt that the baby boomers handed to us hit us square in the faces so that it doesn't get any larger and threaten to take our nation with it. Soldiers aren't the only people required to make sacrifices for freedom, so suck it up kids.
        • pakakapa, on 03/10/2008, -0/+1I fail to see how is taxcut-and-spend-in-wars any good.
    • Corman420, on 03/09/2008, -2/+9You got it. But personal debt played a HUGE role in this as well... Too many Americans rely on credit cards. Your spedning someone else's money, and most likely that money you;re spending was borrwed from somone who invested wiht money they borrwed.. See the problem?
      • maninblac1, on 03/09/2008, -0/+11That's poor consumer choice. My motto is never to spend money i don't have. You pay off your cards in full each month. The only outstanding things you should pay for on a monthly basis are your home and your car. Other recurring debts are simply a waste of money.
        Their wouldn't be credit issues if we didn't have inflation, people could afford their debts.
        • Corman420, on 03/09/2008, -0/+2Someone here actually understands!!!
        • Antwan718, on 03/09/2008, -1/+1Unfortunately you get a better rate for your car/ insurance/ loan if your credit score is better, to better your credit score you must carry SOME credit card debt. The system is designed to make you take it with no KY.
        • GreenGrassyNoel, on 03/10/2008, -0/+1except in special circumstances, I haven't been convinced that you need to borrow money for a car.
      • CoolWind, on 03/09/2008, -2/+1Are you blaming people who borrow or those who lend, or both? And what are you blaming on them? The Bush administration's complete lack of responsible behavior in all areas of administration?
    • mr_wej, on 03/09/2008, -2/+3We had double digit inflation in the eighties and survived just fine. The world wide economy is a complex and remarkably resilient engine, high inflation is always a side effect of long periods of low unemployment - which is what we've enjoyed for many years - no need to get panicky. :-)
      • maninblac1, on 03/10/2008, -0/+1Yes, but there is a very key difference between the 78-82 and now. When inflation hit double digits, the Fed raised interests rates, as it should. In 1980 the prime interest rate was above 20%, right now we're at 3% and thinking about going lower.

        Why do what they did rather than what is being done now. It's better for 2 reasons, as it is now, the Fed makes getting money easier with a lower rate, so if getting it's easier people or banks will take chances they otherwise wouldn't (it's a good time to do it right, rates are low). More money means more inflation, it's a cyclic effect. But if done right, it wards off the recession for a little while longer until another pinch comes along. And everytime the pinch gets harder until it can't be stopped. Like right now. The banks know this is the case, which is why even though rates are low, they are cracking down on credit. In their own way they are raising interest rates, such that only those who can really afford loans get them.

        Reason 2 is that the high interest rates are terrible for the economy, people default on their loans, banks close, the economy takes a nose dive. But with all that interest leaving the economy, inflation is stopped and perhaps we have deflation and after the economy is done tanking, it stabilizes and we start fresh. In other words, you know where the economy is going, down, and you know it's going to hit hard and fast, but it's a done and over with effect rather than a long drawn out "i wonder if the economy is going to go into recession."
    • willynilly, on 03/10/2008, -0/+1"then the government must come in with unemployment checks to save the people, which begets more inflation"

      WHAT? No. That is not true; it doesn't even make sense. And what high inflation? As wej pointed out, inflation was WAY higher than this in the '80s.
      • maninblac1, on 03/10/2008, -0/+1The national debt in 2000 was 5.6 trillion. It is now 9.4 trillion in 2008. 3.8 trillion in 8 years. You'd have to go back to 1985 to get to 1.8 trillion (or the 3.8 trillion difference). 15 years, versus 8 years to increase the debt the same amount? And if you want to get technical you can tack on the 400 billion dollar deficit this year for the full year of 08 with bush's budget which ups it to 4.2 trillion, at which point you'd have to go back to 1982. So an 18 to 8 year difference.

        Every dollar of "debt" is a dollar that didn't exist to begin with, it is an inflationary dollar. Naturally, the economy must expand with the population which holds back inflation a little, regardless, our economic size did not double in those time frames either.

        When are you people going to get it through your heads, what the government measures is core inflation, which has little to do with actual inflation. In a limited value market, doubling the amount of currency you have, halves it's value.

        Or how else can i put it to you, if real inflation was at the level the Fed claimed it to be at, there would be no problems with the economy everything would be normal. How else do you explain the shrinking trade deficit. American goods are now all of a sudden super cheap for foreigners, and their goods are expensive for us, when was your last trip to Europe, the dollar is as record lows against the euro. Wake up, it doesn't take a moron to see what is obvious in front of our eyes.
    • Lanlost, on 03/10/2008, -0/+1Conservative spending is what we should always be doing. Keep in mind that the Government is already in an insane amount of debt and has made many more promises to spend.
  • ScienceDoc, on 03/09/2008, -18/+29This prosperity is courtesy of the Bush Tax Cut. Keep waiting. It will trickle down. Those Exxon and Wallymart execs are gonna have to buy something.
    • hamobu, on 03/09/2008, -10/+7I think there is more to it than Bush's tax cuts:
      1. There is more people in USA now, competing for the same jobs
      2. The rest of the world is more competitive as well
      3. American way of life is not sustainable.
      4. Government is not working (the budget has not been balanced in decades, and many years there has not even been the budget)
      5. Americans have not been making the best decisions in their personal lives (buying crap on credit, not saving money, and not educating their kids)
      etc.
      • mtekk, on 03/09/2008, -2/+1"3. American way of life is not sustainable."
        elaborate.

        Many Americans are living beyond their means, which is more or less not sustainable, but that is not the "American way of life"
        • hamobu, on 03/09/2008, -2/+4American way of life is not sustainable:
          1. Not every family can have a house and two cars
          2. Not everyone can commute 25 miles to work in a 5 ton car to bring his 100-200 lb frame to work
          3. We cannot continue creating one ton of garbage per person per year.
          4. etc.
      • bobcrotch, on 03/09/2008, -0/+2Just as an FYI it's not only Americans that live this way. It's all first world countries.
        • hamobu, on 03/09/2008, -0/+1I was under impression that Americans have the most cars, and the biggest cars, and that people in other countries are more likely to live closer together, or even in high rise apartment buildings. I guess I could be wrong about that.
          • bobcrotch, on 03/10/2008, -0/+2No, I'm pretty sure that you're being presumptuous. Why would anyone live that way if the geography didn't dictate it?
          • hamobu, on 03/10/2008, -0/+2That is right. Places like Japan, Korea, and parts of Europe are more densely populated, and people do live more closely together. Further more, cars in Europe are smaller due to their high gasoline tax.
    • DaDrake, on 03/09/2008, -10/+5What is funny is most people, despite political viewpoint, acknowledge Bush's first tax cut stimulated the economy.
      • hamobu, on 03/09/2008, -1/+11That is true in the short term, but huge government debt is biting us in the ass.
      • mOdQuArK, on 03/09/2008, -1/+10That's because "most people" don't make the connection between a short-term stimulus & a long-term debt drag (i.e., raping the future to make major bucks _right now_). An intelligent leader would have chosen to invest in a way which encouraged long-term growth (i.e., in infrastructure & R&D). Too bad we don't seem to have had any intelligent leaders in the last decade or so.
        • hamobu, on 03/09/2008, -0/+13because our elected leaders are elected to four year terms, they are driving this country like it is a rental car. There is no incentive to sacrifice now for the better future.
          • Antwan718, on 03/09/2008, -0/+2Something similar to this happened in France around the time of 1776, oh yea wait what was that thing again?
    • scamper22, on 03/09/2008, -5/+2The sad fact is the trickle down effect works...up to a point.
      You start cutting the taxes of middle class or even rich people, and you will see a trickle down effect (anything less than $300,000 per year). Thats my guess. Why? These are the people that can actually spend money locally. They can go to expensive restaurants, buy nice cars, clothes, going to clubs... This is where the trickle down effect works.

      Now once you start talking about wealth (say $1 000 000), now the trickle down effect goes down substantially. How much of their money goes to the local economy? Can you really spend 1 000 000 on meals, clothes, waitress tips, drinks, clubs...? probably not. The only way this might work is if they invest in local companies, but with manufacturing being so cheaper overseas...are they going to invest locally? Probably not.

      So if anything, the bush tax cuts should have been for anyone earning UNDER 250k not over :)
      • hamobu, on 03/09/2008, -1/+2trickle down is more than just rich people spending money in restaurants. Rich people actually have very little money in their pockets - most of their money is invested somewhere earning interest. Rich people money gets invested in the economy trough savings, stock market, etc. Additionally, due to lover tax rate, profits go up, which means that it now makes more sense for businesses to hire more people, etc.
        • scamper22, on 03/09/2008, -0/+1yeah, and the question is...are they investing in US jobs?
          Are they going to throw bad money after bad at US manufacturing which is uncompetitive on the global scale?
          They wouldn't be investors if they did now would they?
          • hamobu, on 03/09/2008, -0/+2I am not defending trickle down economics, I am just explaining it. When it comes to economics, there is very little proof that any of these theories actually work.
          • Memitim, on 03/10/2008, -0/+1Even if they do, the purpose is to get more money back in return. That's why trickle-down economics is fail, because the ultimate goal for those who are supposedly trickling down is to end up with more than what they started with. Some trickles down, more pours back up.
          • scamper22, on 03/10/2008, -0/+0@Memitim,

            I'm no fan of trickle down economic, but your argument makes no sense.
            If they invest in the USA and create jobs...thats jobs that were not there before.

            If you have nothing.
            Then some rich guy gives 10, but keeps 90 for himself, you still come out ahead
    • darkciti2, on 03/10/2008, -0/+4Billionaires don't shop in local communities (often). They travel internationally and buy executive quality goods.
  • lkmbrd, on 03/09/2008, -1/+5"Predition" means "before dition."
  • rzxc, on 03/09/2008, -22/+51Yet another "sky is falling" economic article on Digg. While the economy is going to be weak for a while, chances are things are not going to be as bad as the author of this article believes. Here's why. I don't think number 12 is going to happen. The basis of number 12 is that the bond insurers have become insolvent because of the sub-prime meltdown, therefore there is no bond insurance, therefore local governments can't get money. While this is true for the moment, I believe this problem will fix itself shortly. Most likely, the bond insurers are probably going to split themselves into two parts: a municipal bonder insurance company (which should be strong), and a mortgage bond company (which should go bankrupt the moment it is created). The reason why they're going to be split in two is because if they don't, someone else will fill the void. Right now, they can't offer any sort of insurance to anyone. If they split, at least they will have one good business. Actually, I think Warren Buffet had a lot to do with the movement to split the insurance companies. He wants to get into the municipal bond insurance business, and offered to buy out that part of the business from AMBAC and the other insurers. I believe that if the existing insurers do not get their act together quickly, Buffet will just step in and take that business from them. Most of the other predictions are equally debatable, or at least the consequences of them are equally debatable. For example number 8. There's no chance that a free trade bill would pass now, so if that legislation doesn't pass in the future, that situation is no different. As for number 3, economists have been worried that the consumer is going to stop spending for as long as I can remember. It hasn't happened yet and I doubt it will. Obviously, consumer spending does fluctuate somewhat, but I doubt it will really collapse. There are other issues I have with this article, but this comment has run on to long already, and I have other things to do.
    • aukxsona, on 03/09/2008, -0/+3The bond insurers have been down graded to B ratings, THAT alone has touched off 20% interest for Muni bonds.
    • cubicledrone, on 03/09/2008, -4/+9We don't build anything any more. All we have are ***** and ***** jobs paying people less and less so they can buy ***** and ***** products. Pensions? Gone. Health insurance? Gone. Job security? LOL It's all been sold off. We need to start paying people to build things again, or we don't have an economy. We have a shopping mall.
      • ShnowDoggie, on 03/09/2008, -2/+210 years ago I had my house built. I have added a deck and a loft. My neighborhood has grown so much that we built 2 new elementary schools in addition to one that was here when I moved in. We are still building. Maybe not enough roads ...
      • BashiBazouk, on 03/10/2008, -1/+2"We don't build anything any more."

        *****. US manufacturing is about 2 1/2 times that of china...The US accounts for about 21% of WORLD manufacturing. Our two major competitors, Japan (19%) and the EU (26%) have lost a few percentage points over the last decade while the US has remained constant.
    • Sharky35, on 03/10/2008, -0/+3You should write an article so i can digg it! When a economist starts inserting his political, religious, or sexual preference... His credibility takes a -10 on the scale.
  • elebrio, on 03/09/2008, -23/+26Who is this guy making the predictions and why the ***** should i respect his opinion when he writes ***** like this:
    "7) Multiple banks will probably go insolvent. They are simply holding too much crap paper."
    This article is severely lacking supporting evidence. True or not, this is just red meat political venting.
    • aukxsona, on 03/09/2008, -1/+17The FDIC released a statement that at least one large bank will fail this year. The FDIC is also hiring veterans from the Savings and Loan crisis on. It's no BS. If you look at all the data it adds up.
    • hamobu, on 03/09/2008, -2/+7You should not agree with the author! It is a discussion. That is kind of the point.
      • aukxsona, on 03/09/2008, -3/+2LOL
        • sekhui, on 03/09/2008, -2/+2thanks for that intelligent, well-reasoned rebuttal.
          • aukxsona, on 03/10/2008, -0/+2I thought the comment was comedy, not actually intelligent discussion.
    • anarcurt, on 03/09/2008, -0/+9Number 7 is very real. Along with aukxsona's reply, two weeks ago in the Wall Street journal front page was an article on the FDIC hirings. Last year 4 banks went under in the whole country, expectations for this year are well over one hundred.
    • mj1903, on 03/09/2008, -2/+6Warren Buffet: "I don't make predictions about the future as it's an impossible task".

      So the wealthiest man on the planet who probably knows the US economy more intimately than any other person isn't willing to make any predictions because he more than likely will be wrong! So why are we listening to some nobody?
      • hamobu, on 03/09/2008, -0/+5According to your logic average persons should never have any sort of discussion on any topic.
        • PostScience, on 03/10/2008, -2/+3Generally I agree with you, but exceptional claims demand exceptional proof. If you were to tell me that aliens abduct you nightly, you might be correct for all I know. But, I'm not going to believe you without some pretty darn convincing evidence.
          • hamobu, on 03/10/2008, -0/+3You analogy does not really apply because it is clear from the article that the guy is making predictions and not stating facts or making unsupported claims. It is just as acceptable for average people to make economic predictions as it is for them to make sports predictions.
    • dannyhsdad, on 03/10/2008, -0/+2#7) see http://www.fdic.gov/bank/individual/failed/banklis ...

      No bank failures between June 04 and Feb 07. 3 failures in 2007. 2 already in the first 2.5 months of 2008. The trend is ugly...
  • mesmeriffic, on 03/09/2008, -20/+11I'm getting a fat trust fund inheritance in 5 years. Low real estate prices here I come!
    • browwiw, on 03/09/2008, -2/+11I hope you get hit by a bus.
    • mOdQuArK, on 03/09/2008, -0/+10I wonder how much that inheritance's value will fall in 5 years.
    • Cryoniq, on 03/09/2008, -0/+6There probably wont be anything of value left in that trust fund at that time. There is no escape when this crisis hit.
    • jonjo, on 03/09/2008, -1/+2I hope your trust isn't invested in commodities, it will be worthless. I hope your trust isn't wiped out by hyperinflation. I hope you get hit by a bus.
    • Phucked, on 03/09/2008, -1/+1Hey Mesmeriffic lets be friends, or better yet BBF
    • Scaryclouds, on 03/10/2008, -1/+1I think everyone here will agree with me when I say you are a douchebag.
    • sfasu77, on 03/10/2008, -1/+1Ahh..the American dream.... I, for one, welcome our Trust-fund baby overlords.
    • rodgerdodger5, on 03/12/2008, -0/+1Go find a homeless guy and save his life with some of it. How cool would that be? To save someones life and get them completely back on their feet? Like find the person in the worst possible situation, send him through drug rehab, etc..all the way to having a job and an apartment again. I smell a nice documentary that would make you some big bucks while you are doing it.
  • aukxsona, on 03/09/2008, -5/+13This is a good piece, but lacks the additional news stories that Digg readers come to expect as evidence. I personally know everyone of the points to be true, because I have been following this subject extremely close. If you look at all the economic data, the only choice we have is to build a new bubble...no credit to do it...or recess in a stagflation state. If we don't fix it by them it will turn to deflationary or hyper inflationary. Many international bankers etc... hold the same opinion. This isn't BS. The FDIC has been looking at the possibility of one or two LARGE bank failures and it is easy to see why since the amount of reserves held to reserves lent is in the NEGATIVE according to the FED. With the current trend being people who foreclose or default, it is very easy to see a bank or two folding. Also, Municipalities were in the headlines having a hard time selling Muni bonds to keep afloat BECAUSE their insurance has been down graded and some found insolvent. I mean this is a financial tsunami.

    • Lanlost, on 03/10/2008, -0/+0People have this attitude where they honestly believe everything will just balance itself out and we will be alright. It's not like we have personally had to face a huge recession or anything so we are only guilty of not knowing what we don't know but that doesn't give us an excuse. The government treats our money like we do. Spend, spend, spend. We know that someday it will catch up to us but the longer it takes, the less we believe it will ever actually come. Then one day.. ouch. It really sucks.
    • sgglynn, on 03/10/2008, -0/+1"I personally know everyone of the points to be true, because I have been following this subject extremely close."
      Oh, alright then.
  • hamobu, on 03/09/2008, -11/+24The truth about economy is that American way of life is unsustainable. Not every family can have a house and two cars. I think what we are seeing is some necessary belt tightening that will continue in the decades to come. Still, I think that nobody will starve in the US.
    • DaDrake, on 03/09/2008, -7/+10This is not an American thing. Every culture has a great deal of people who live beyond their means. In the end, they get burned (like now... with homeowners using their home mortgage as a giant ATM). Honestly, I have no sympathy for them. Intelligent people who make wise investments (like myself) make money in the long run. In fact, if you can't find a solid investment in "the US economy" .... then you have ***** for brains.
      • hamobu, on 03/09/2008, -2/+2Truth is that finance is beyond most people. Most people could not compound interest, let alone weight the risks vs. returns. maybe we do need the government to protect people from themselves.
        • TimDigg, on 03/09/2008, -4/+1I honestly believe like you do that the majority of society is not that smart, just look at the shows you see on television each night as proof.

          Even someone such as DaDrake or myself who make great financial decisions. If the majority makes incredibly bad decisions, then those decisions affect me as well and it would be silly for me to pretend otherwise.

          For example I lost my job last year at a very large fortune 10 bank. Not because I wasn't doing my job, but because of decisions made elsewhere in the economy that affect my business. Currently I work for the federal govt, which is probably the safest bet as we slide into recession.
    • cubicledrone, on 03/09/2008, -5/+4The "economy" has been in the toilet since the early 1970s. It's just now getting to a point where people are realizing that when there are no decent jobs, you can't expect people to sign up for 30 year mortgages. Business is not willing to train, build or employ long-term, but they all want long-term customers: 2 year phone agreements, 30 year mortgages, 5 years to pay off the TV, 10 years to pay off the car, etc. It doesn't work, and the "economy" is proof.
      • ShnowDoggie, on 03/09/2008, -1/+2What? 38 years in the toilet? And yet we are living longer, our housing has improved, communications can not even be compared to 1970. Thanks to the computer industry there are lots of young millionaires. Yes, the economy is going to get worse. Bush has spent a lot of our future foolishly, and payback will be a bit of bitch. But we have not had 35 years of toilet. Furthermore, people in this country work. The recession will not be that bad. It will not be the best of times, but we will get through it and then the economy will happily grow until the next correction.
        • hamobu, on 03/10/2008, -0/+3You are both right to some degree. We are living longer, but in the 60's a man without completing highschool and with a factor job could provide a nice life for his home maker wife and two kids in the suburbs. Today families are struggling to get by with two incomes provided by college educated maried couple.
          • ShnowDoggie, on 03/10/2008, -0/+1In the 60's people had smaller homes, one car, and worse health care. We also had more natural resources per capita as our population was smaller. Most families today could live on one income if they chose to. They would have to give up that big screen TV. They would have to be smart and not get into dept. Today IS much harder for the uneducated due to the loss of manufacturing jobs. (Perhaps I should say non-higher educated because today employers want a college degree.) But overall the economy has grown over the last 38 years. People are still coming to the United States to work. We have low unemployment. Many people are struggling. But that has always been the case. I have uncles who grew up in the 60's, the sons of a doctor, who were malnourished part of their childhood because they did not have enough money for food.
    • KSUdesigner, on 03/09/2008, -2/+9Every American family can have a house and 2 cars, the problem is that most families go after bigger houses and more expensive cars than they need.
      • hamobu, on 03/09/2008, -0/+5I don't think so. It is not just the gas, and the heating bills. You need to lay down the road, digg up sever, water, gas lines, telephone and cable wire etc. You cannot have effective public transportation in the suburbs.

        In the countries where people are more denser populated, Internet service is faster, public transportation is better and is used by more people, and rising oil prices are less of a problem.
        • Shinobi326, on 03/10/2008, -0/+2Yeah but it smells bad when you have to live on top of one another
          • hamobu, on 03/10/2008, -0/+1I guess it depends on a high-rise. Sometimes when your neighbors would cook some smelly food, the whole hallway would stink. And the shared dumpster would of course reek.
    • stev31h, on 03/09/2008, -3/+1I wish i could digg you up 100 times
    • cespee, on 03/09/2008, -0/+1Every family can't have a house and two cars in a country that wages stupid wars unnecessarily, refuses to balance a budget, refuses to print its own money without help from the Fed that charges debt on money creation, and wants to hand out endless government cheese. If the American family didn't have to support a bunch of crooked bankers or bafoons, it could live in prosperity.
    • BedPost, on 03/10/2008, -0/+3Err. People are already starving in America.
    • mGARANDEUR1, on 03/10/2008, -0/+1Yeah, you should save energy and shut your computer off.
  • Mr.Gone, on 03/09/2008, -21/+12I stopped reading around "China will take it out on the US and Japan". This guy has diarrhea of the mouth. I'm getting so sick of the rampant fear mongering that is so prevalent lately. Ever group seems to think that fear is the only way to effect action. Maybe we need natural predators, something that we should actually be afraid of. Giant ***** roaches that hunt us on a daily basis. I guarantee that after that no one will worry about the economy or their hairline or who wins what primary.
    • dartmanx, on 03/09/2008, -0/+2Okay, what do you think the Chinese oligopoly will do?
      A. Admit they are wrong and possibly lose power?
      B. Scapegoat someone else?

      I'd lean towards B.
  • lougoose, on 03/09/2008, -5/+23[citation needed]
    (some of it is true for sure, but for the rest, we need some evidence)
    • eltolete, on 03/09/2008, -1/+2did you read the part where it said 'predictions'?
      • lougoose, on 03/12/2008, -0/+1Fine. I predict that Microsoft is going to go bankrupt tomorrow. Does that make it right? Do I have any proof? No, and no.
  • cambob76, on 03/09/2008, -7/+14I can't tell if the comments on that page are sarcastic or not. Can people really be that retarded?
  • displaced1, on 03/09/2008, -7/+13I am curious as to what this guys qualifications are. How is he able to predict these things, what has he done in the past for him to be able to predict the future events? Or is he just some random guy with internet access?

    Sorry for my logic.
    • Swampthing, on 03/09/2008, -5/+5probably about the same as yours. what qualifies you to say he's wrong?
      • displaced1, on 03/09/2008, -3/+10If he has the same qualifications as me, then bury this story quickly, because he has no clue.
      • mockupscaledown, on 03/10/2008, -2/+5Sorry, bud. The burden of proof lies with the article writer, not with people wondering if he's qualified enough to be trusted.
    • cubicledrone, on 03/09/2008, -4/+4So if a professor of Economics and someone who writes an article both say the same thing, the economics professor is more right than the author? Why do people need specific "qualifications" to speak? This is part of the problem. We can't have a conversation in this country because nobody ***** listens any more. They need "studies" and "data" and "qualifications" first. It's *****.
      • displaced1, on 03/09/2008, -2/+4Speak all you want, but if you don't have knowledge/facts to back it up, then it means nothing. What the real problem is people believing stories they read that have no factual basis. Hey, lets all vote based on what we see on TV ads and what random people on the internet say. The internet is the best and worst place for information.
      • CoolWind, on 03/09/2008, -1/+3The issue is credibility. If you don't have it, your predictions are meaningless without hard evidence and solid logic. If you have credibility, like Warren Buffet, then you don't need to go into quite as much detail.
      • mockupscaledown, on 03/10/2008, -1/+3I hope you're being sarcastic. I would more likely trust an actual brain surgeon to perform brain surgery on me than a brain surgery enthusiast or guy with an internet connection. Does this make me part of the problem?
    • eclectro, on 03/09/2008, -2/+3What qualifications he has? The answer is obvious - he stayed at a Holiday Inn and voted for Ron Paul.
    • towtow, on 03/10/2008, -0/+0Were all just some random people with internet access?
      Your Logic is ok but you seem a little lacking in seeing things for yourself. Any one can put a doomsday letter together. To bad we don’t see solutions to the problems we are facing instead of how bad things are going to get. Qualifications don’t make you more right than someone that has no qualifications. As far as mister dooms day goes what does it matter if it all goes south were all in the same boat. I think the experts will call it a realignment period.
      For those that are in alignment opportunity will exist. As far as how can he predict
      these things. They are all connected together and if one happens the probability
      Of the other to happen does exist.
  • mrzack, on 03/09/2008, -13/+5I just threw up in my mouf....
  • pjpark, on 03/09/2008, -5/+12Lots of people make lots and lots of varying predictions about the economy all the time. In all probability at least one of those predictions must be right. And if anyone is right, it must be the guy who wrote this article because he numbered his predictions and even used bullets.
  • DaDrake, on 03/09/2008, -9/+10Pick up the walstreet journal and read analysis by established people. People who eat into this ***** oftentimes don't understand basic economics.
  • Defuser, on 03/09/2008, -16/+23Welcome to Digg, where affluent white children that have never had to worry about food, medicine, or housing gather to whine about how horrible it is to be an American. I hope to god that none of you juvenile wankers ever have to experience REAL hardship.
    • hollyberrry, on 03/09/2008, -2/+5Your comment does not encompass me, thank you very much.
    • scamper22, on 03/09/2008, -3/+9and you would be what?
      An American who actually thinks they're in poverty? There is no poverty in America. Having grown up in Africa, I can say, even the most menial welfare existence in America is still living quite well. (Well...meaning roof on your head and food on your table.)
      • manirock, on 03/09/2008, -4/+7Oh yeah?! well I used to walk to school in the SNOW for 15 MILES, up hill, BOTH WAYS. And I had to catch my dinner every night- with only a rubber band and a paper clip...
  • charmaniac, on 03/09/2008, -8/+30Give me a break. We are going to enter a deep recession, but we will survive. It will not be a "great depression" for many reasons. We have the SEC which provides much greater regulation of securities than existed in the 1920's. Sarbanes-Oxley makes it much less likely that company executives will lie about the state of their companies because they will face potential prison time. We have technology that makes our society much more efficient.

    Things will get bad, lenders are going to lose a ***** load of money. You know what? Thats the cost of doing business as a lender. Lenders decided that due diligence just wasn't necessary, so now they will get burned. But, it will not be anything like the great depression.

    And for everyone who thinks Russia, China, or India are going to take our place as the world's largest economy, it just isn't going to happen anytime soon. When we go into recession, the rest of the world will go into recession. Yes, we are that big of a deal. 25-40% of the world's economy in fact.
    • aukxsona, on 03/09/2008, -2/+2Not sure I agree. I know about the SEC, but Clinton took a lot of teeth out of the organization. Furthermore, they seemed to have looked the other way on the exotic new non-transparent CDO's. Also, yes the world will get hurt if we go under, but n