Reply #67: In the early 80s

[chervilant]

two of the top ten US banks were so close to insolvency that Paul Volker had to create an emergency paper asset (actually a liability masquerading as an asset) so that these banks could fallaciously maintain their required debt-to-income ratios until they 'stabilized.' That was just the tip of the iceberg.

Others posting herein have correctly identified the Reagan era as THE point in history at which this train wreck began. Our wrecked economy is grinding to a 'halt' soon--a catastrophe unprecedented and virtually unimaginable.

When our nation's GAO chief asserts we are facing a horrific economic crisis, when Paul Volker observes the US has a greater than 75% chance of experiencing a severe economic crisis within the next five years, when Ford Motor Company's PR hacks announce massive layoffs, then grimly admit it may be 2009 before they register in the black again, one has to accept that our economy is in dire straits.

Bear in mind that during this nation's FIRST long depression (the Panic of 1873, lasting 23 years), our nation realized significant increases in productivity FOUR times, and inventive geniuses gave us the electric light, telephones, and cars (a comprehensive list of this era's amazing inventions would require several more pages than I have herein...). In short, economic behavior continued unabated, even while many in our nation suffered serious deprivation.

We are facing something much more dire, and we must acknowledge that our nation has NEVER been in the same economic situation we now face. We've never had an 8.7 trillion dollar national debt while at the same time sustaining an endless massive trade deficit (ponder this the next time you get all excited about the 'great deal'--made in China--you got at the dollar store). We've never had an administration that is SO invested in rewarding Bush's 'base' that their media mouthpieces vomit forth continuous lies about our nation's amazing economic 'recovery.' (Rove's fingerprints are all over these well-placed pronouncements: benign, subtle, barely registering among those of us who find the Big, Bad Economy frighteningly incomprehensible.)

No one can predict what is going to happen. However, any corporate hack can tell you what happens when a company continues to expend ever larger percentages of its total output on past and current indebtedness. It's called bankruptcy. Folks, the company WE call the United States is about to go belly up. God help us all when it blows.