America is heading for a serious conflict in a couple of months. The Debt Ceiling issue will create opposite sentiments between our political parties going forward. The Republicans must create an environment of spending restraint to survive going forward. The Democrats must create an environment of MORE spending to survive. This issue will be explosive later this summer (say July). My sense is the America could DEFAULT on their DEBT as the conflict is at loggerheads. A default means worldwide depression for our economy. America can not repay its debts and this is obvious to anyone with some math wisdom.
www.usdebtclock.org
The other issue of significance is the decision by Putin (Russia) to send tactical nukes to Belarus (their neighbor to the northwest). This decision means that Ukraine can not win this war of territorial control when push comes to shove. Russia has the nukes to counter any Ukraine move to take territory. It's totally foolish for the administration in Ukraine to reject a territorial solution to this conflict (now). Their policy of trying to retake the boundary lands and then retake Crimea is impossible IMO and totally foolish (as a military policy). Russia is holding the ACE as they have tactical nukes.
Ukraine needs to rethink their options and recognize that Russia holds the ACE card (when push comes to shove). Russia will choose tactical nukes if necessary. NATO has moved their arsenals closer to the Russian border (Poland and the Baltic's) and this move is now being countered by Russia as they move their arsenals to Belarus. It's all tick for tack and the eventual conflict is unwinnable for Ukraine IMO. The decision makers in Ukraine need to recognize that continuing provocation of Russia will result in Russia using TACTICAL nukes (if necessary). The evidence is overwhelming. Russia must protect its Sovereignty!
With respect to our economy and the global collapse scenario, I would suggest that events are leading to this outcome in a few months. Nothing solid is being done to reverse this eventual outcome. Inflation is not being solved by our policymakers. The debt situation is not being solved. The real estate value situation is getting worse by the day as commercial real estate is now imploding. Office space has excessive vacancy rates and values are going down as Cap Rates increase. This is ominous for our economy down the road.
My sense is that July/August could be the point of no return for our economy. Sentiment is starting to decline as more investors get educated on our many problems. Ignoring these problems just makes the overall problem much worse over time. But our politicians tend to choose the EASY road when they are in POWER. Biden and his leftists want more spending even as the overall debt problem gets worse and worse. More spending increases the debt as our dollar is a DEBT instrument. More spending leads to more DEBT.
The current cycle reveals that all this spending must come to an END (eventually). When I project current spending trends into the future it leads to IMPOSSIBLE debt issues for America and the World. As investors wake-up to the problems, I perceive that sentiment will go south. The markets are mostly psychological and the general psychology is now turning to the negative. People are waking up...and this is good...even as this means huge problems for the general economy. What is needed is a NEW MODEL for the planet.
Keynesian economics is over (as I wrote in a prior missive). Some 90 years of Keynesian economics (based on credit and debt) is now ending. In 'the long run we are all dead' was the mantra of Keynes back in the 1940's. He died in 1946 (Easter Sunday). His model is still being used by our centralized authorities. They have no other options. But the LONG RUN is now here for Keynesian economics. This means we are DEAD (in the water) as we continue to manipulate this corrupt model going forward. It can not work as our DEBT is now beyond repayment. See the numbers and ask yourself how this debt can be repaid?
We need a NEW MODEL based on the productivity of people. People must come FIRST (not money/debt). A NEW MODEL is now trending toward CBDC's (central bank digital currencies) for those who hold political POWER. This option is hugely detrimental to our freedoms and our future as a productive economy. CBDC's lead to a centralized system which stifles growth and prosperity. It also produces the enslavement of the private person as centrally administrated 'identity codes' control everyone's behavior. It's totally diabolical and corrupt. But our POWER brokers will try to implement this model (it won't work)!
What we really need is to ELIMINATE money from this planet. What is money (in reality)? Is it a object within nature? Is it a 'thing' which exists outside the human mind? Think on this idea and question: What is money (in reality)? I say that money is purely artificial and virtual. A 'dollar' today is a virtual unit of nothing. It does not exist in spacetime. It derives its appearance because of our computer technologies. People assume that this unit of nothing exists as they SEE/OBSERVE an image in their computer screen. But what is a virtual image within a computer screen? It's a cyber unit of nothing!
Is it a 'thing' which exists? Is it a physical 'object' which has matter within it? I don't think so! A virtual dollar is nothing (it's merely an image within the human mind). It's much like Bitcoin or any virtual currency. It has no substance or reality (outside the human mind). We need to ELIMINATE this unit of nothing from our planet. A NEW MODEL could be constructed using smart phone App's and Images but with no CENTRAL monetary authorities. Central Bankers could be eliminated. All banks could CLOSE. PEOPLE could be central to this NEW ECONOMIC MODEL. It's all possible down the road. The key concept going forward is DECENTRALIZATION and then a NEW MODEL for our distribution of productivity. Think on this!
Have a great day! I am: Donald B. Swenson, Economist/Philosopher, donaldswenson.blogspot.com.
http://kingdomecon.wordpress.com
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