Economist
Richard Duncan: Civilization May Not Survive 'Death Spiral'
Richard
Duncan, formerly of the World Bank and chief economist at Blackhorse
Asset Mgmt., says America's $16 trillion federal debt has escalated
into a "death spiral, "as he told CNBC.
24
August, 2012
And
it could result in a depression so severe that he doesn't "think
our civilization could survive it."
And
Duncan is not alone in warning that the U.S. economy may go into a
"death spiral."
Since
the recession, noted economists including Laurence Kotlikoff, a
former member of President Reagan's Council of Economic Advisers,
have come to similar conclusions.
Kotlikoff
estimates the true fiscal gap is $211 trillion when unfunded
entitlements like Social Security and Medicare are included.
However,
while the debt crisis numbers are well known to most Americans, the
economy hasn't suffered a major correction for almost 4 years.
So
the questions remain: Is the threat of collapse for real? And if so,
when?
A
team of scientists, economists, and geopolitical analysts believes
they have proof that the threat is indeed real - and the danger
imminent.
One
member of this team, Chris Martenson, a pathologist and former VP of
a Fortune 300 company, explains their findings:
"We
found an identical pattern in our debt, total credit market, and
money supply that guarantees they're going to fail. This pattern is
nearly the same as in any pyramid scheme, one that escalates
exponentially fast before it collapses. Governments around the globe
are chiefly responsible.
This presentation shows how banks are escalating the collapse... "And
what's really disturbing about these findings is that the pattern
isn't limited to our economy. We found the same catastrophic pattern
in our energy, food, and water systems as well."
According
to Martenson: "These systems could all implode at the same time.
Food, water, energy, money. Everything."
Another
member of this team, Keith Fitz-Gerald, the president of The
Fitz-Gerald Group, went on to explain their discoveries.
"What
this pattern represents is a dangerous countdown clock that's quickly
approaching zero. And when it does, the resulting chaos is going to
crush Americans," Fitz-Gerald says.
Dr.
Kent Moors, an adviser to 16 world governments on energy issues as
well as a member of two U.S. State Department task forces on energy
also voiced concerns over what he and his colleagues uncovered.
"Most
frightening of all is how this exact same pattern keeps appearing in
virtually every system critical to our society and way of life,"
Dr. Moors stated.
"It's
a pattern that's hard to see unless you understand the way a
catastrophe like this gains traction," Dr. Moors says. "At
first, it's almost impossible to perceive. Everything looks fine,
just like in every pyramid scheme. Yet the insidious growth of the
virus keeps doubling in size, over and over again - in shorter and
shorter periods of time - until it hits unsustainable levels. And it
collapses the system."
Martenson
points to the U.S. total credit market debt as an example of this
unnerving pattern.
"For
30 years - from the 1940s through the 1970s - our total credit market
debt was moderate and entirely reasonable," he says. "But
then in seven years, from 1970 to 1977, it quickly doubled. And then
it doubled again in seven more years. Then five years to double a
third time. And then it doubled two more times after that.
"Where
we were sitting at a total credit market debt that was 158% larger
than our GDP in the early 1940s... By 2011 that figure was 357%."
Dr.
Moors warns this type of unsustainable road to collapse can be seen
today in our energy, food and water production. All are tightly
connected and contributing to the economic disaster that lies
directly ahead.
Keith
Fiz-Gerald: Germany's military held a secret investigation into this
unsustainable pattern and concluded it could lead to "political
instability and extremism."
According
to polls, the average American is sensing danger. A recent survey
found that 61% of Americans believe a catastrophe is looming - yet
only 15% feel prepared for such a deeply troubling event.
Fitz-Gerald
says people should take steps to protect themselves from what is
happening. "The amount of risky financial derivatives floating
around the globe is as much as 20 times size of the entire GDP of the
world," he says. "It's unsustainable and impossible to
unwind in any kind of orderly way."
Moreover,
he adds: "People can also forget that the FDIC can only cover a
fraction of US bank deposits. It's a false sense of security. Just
like state pensions, which could be suspended at any time. A collapse
could wipe out these programs. Entitlements like Social Security and
Medicare are already bankrupt and simply being propped up."
We
can see the strain on society already.
In
two years, Congress won't have any money for transportation, reports
the Washington Post. Cities like Trenton, NJ have layed off one-third
of their police force due to budget cuts. And other cities like
Colorado Springs, CO removed one-third of streetlights, trashcans,
and bus routes, reports CNN.
Fitz-Gerald
also warns of a period of devastating inflation. A recent survey,
reports USA Today, notes that in the coming years it could take
$150,000 a year in household income for a family to afford basic
living expenses - and maybe go out to a movie.
Right
now, in fact, "52% of Americans feel they barely have enough to
afford the basics."
"If
our research is right," says Fitz-Gerald, "Americans will
have to make some tough choices on how they'll go about surviving
when basic necessities become nearly unaffordable and the economy
becomes dangerously unstable."
"People
need to begin to make preparations with their investments, retirement
savings, and personal finances before it's too late," says
Fitz-Gerald.
For
video GO
HERE
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