Analysts are now warning the US is on the verge of another recession.
US banks are a mess.
44 million Americans are now reliant upon food stamps.
Since 2008 the US has spent trillions of dollars and yet the US debt has increased by $5 [itrillion.[/i
By the end of the decade the official national debt will pass [i$20 trillion.[/i
The unofficial US debt (including estimates of non-declared exposure) is [i$100 trillion.[/i
The FED has kept the economy alive - but only by printing more money.

In terms of GDP, the official national debt will be 150% of GDP. This is important because it is roughly equivalent to US debt at the end of WWII. But at that time the US economy was just kicking into gear and it went into almost exponential growth right up until the 70s (rightly labelled the wealthiest period in American history).

But where will the money come from now? For a start the US can no longer rely on cheap domestic oil as it has all been sucked out of the ground and it can't lower interest rates below 0%.

Worse still the Euro is on the verge of catastrophe. Technically Greece has defaulted on its debt. For the life of me I can't see how Spain and Italy can do anything other than the same.

When will Germany finally admit defeat and dump the Euro? When will the bigger European economies get fed up of bailing out the poorer ones and pull up the drawbridge?

Actually the US can rely of domestic oil. It is set to become a net producer and probably the world's biggest producer over the next 20 years or so. The fact that so many are of food stamps should provide low-cost labour for the US' manufacturing sector. They may be bust but they are alot, lot, lot better placed than the UK and the countries with the EU.

As to Europe if Britain were at all competent they'd have outflanked France and helped create / be currently promoting a Northern European alliance - with German, Holland, Scandinavia, Poland to set a new path for Europe. France could become champion of the PIIGS if it wished and they could all wallow in their s**t together. The Northern Alliance could then power forward and dismantle the stupid legislation that makes Europe so uncompetitive. They could also cease to maintain the Southern EZ members and create a Nortb South controlled border to avoid huge influxes from the south.

I said it can't rely on [icheap[/i domestic oil. Sure, there is still plenty of oil in the gulf and up in Alaska. But it's not the kind of oil that you needed only a spade to cause it to gush out of the ground.

You mean this manufacturing sector?





or do you mean this?

That last photo is probably the most pertinent in terms of us manufacturing with unpaid prison labour allowing many us corps to remain competitive against the likes of China India etc.

Well, the US has been decreasing the threshold for criminal behavior and opening up more and more prisons for many years now.

What the logical conclusion to this policy might be is the big question. I mean, the US is probably the biggest trumpeter of "Democracy" and "Freedom" since the days of ancient Athens. But only a privileged few were members of the Greek Demos and the Athenian economy was almost wholly based on slave labour. You say prisoners, I say slaves ... ?

To answer the original question, no.

In answer to the original question we must hope not. If they are then they would lurch towards right-wing nationalism. The effects of that would be chilling both economically and in a security sense. China as the US' prime creditor would be destabilised economically and no doubt tensions between the US and China would rise to a catastrophic level.

If we are talking about an individual or a business to the same the level, relatively speaking, I think the answer is unquestionably yes. And for some considerable time.

Right now it looks like the only two things keeping it afloat are the Federal Reserve's printing presses (which are simply exacerbating the problem) and confidence. The entire world's attitude seems to be to hope US (and European) debt will go away magically (which is simply exacerbating the problem). It's like the standoff at the end of a Sergio Leone movie where everyone is eyeing each other - but instead of waiting for a pistol to be drawn it is the first - catastrophic - sign that someone is dumping the dollar. Fast.

And when it goes ...