New book: Financial Armageddon

I would like to recommend a new book by Michael J. Panzner that was released on March 1. It's "Financial Armageddon: Protecting Your Future From Four Impending Catastrophes".

Panzner foresees a perfect storm brewing in global finance and the American economy. He has a chapter on each of the four threats he sees: debt, the retirement system, government guarantees, and derivatives.

He sees four stages of breakdown: First, economic malaise; second, a system crisis that pushes the economy over the edge; third, a depression worse than the Great Depression; and fourth, hyperinflation. He is not specific about timing, but he sees the process as grinding on for years as the situation gets progressively worse.

Panzner does his best to predict the consequences to society, based on what has happened in other countries during periods of economic breakdown, as well as in the U.S. during the Great Depression. His final chapters are on what can be done now to prepare.

Panzner is no fringy survivalist. He's a financier who has worked for the likes of Soros Funds, JP Morgan Chase, and HSBC. This book provides a good cram course on the global macroeconomic situation -- how to understand what is going on (for example, the unwinding of the yen carry trade, which seems to be happening now) and what to watch for as the situation deteriorates.

60 minutes last night had an interview with the HEAD of the GAO. Yes, a high level govt. official that controls our budget is preaching this scenario also. The main threat he saw, is the bay-boom generation reaching retirement age. We simply don't have the money for it. Many in Washington agree, however, no one wants to acknowledge it.

A shame- our children and grandchildren will pay the bills.

Here's a link to an interview with the author on Financial Sense this past weekend:

www.financialsense.com...
.

Check that. They seem to have their links mixed up.

If you go to the March 3rd broadcast page here:

www.netcastdaily.com...

You can find the correct link.

For example - here's the winamp link: www.netcastdaily.com...
.

[edit on 3/5/2007 by Gools]

When large counties "go bnankrupt", and deep and rterrible depression hits, the same thing always happens.... the best bits try to leave as do ones with a cultural link elese where wwho believe that that will allow others to step in to help them..

If the USA does experience total finiancial collapse, it is likely that several states would try to cede. The most likely would probably be...

- Alaska
- California
- Oregon and Washington
- Texas
- New Mexico and Nevada
- Pueto Rica
- Michigan (as a big part of it used to be Canadian)
- Hawaii

Indeed, I have always wondered why the USA has not a parallel of the French Separatists regarding the hispanics. At some time they will seek a new independant state invlving many of the states in the South West and Siuth of the USA. With many of A,merica hispanics being "Middle Class", aneconomic collapse might well push them into this.

What the GAO guy is trying to do, though, is build political support for reneging on Social Security's commitments. Everyone should study up on the history of Social Security, because the Bush administration and others are trying to distort this history.

In 1983, it became apparent that Social Security would not be able to meet its commitment to the Baby Boomers unless something was done. A commission chaired by no less a personage than Alan Greenspan proposed a "trust fund." This meant that the Boomers, starting in 1983, started paying extra money into the trust fund to pay, IN ADVANCE, for the cost of their retirement benefits. We have been making these advance payments for almost 24 years!

What the government tries to confuse people about, though, is just what has happened with that trust fund. It has been treated as just another source of tax income, and it has been spent. In return, bonds were issued. As of the end of 2004, $1.7 trillion in surplus funds had been collected from wage earners. Today it is probably around, or above, $2 trillion. The money that continues to be paid into the trust fund, even today, is paying for Bush's war and his tax cuts for the rich. The situation has greatly deterioriated since 2000. The Clinton government ran a surplus, because it was the Clinton government's intention to honor its Social Security commitments. In contrast, the Bush administration wants to deny that the trust fund is real, whip up hostility against older workers, and renege on the Social Security commitment. In short, the current administration is using the trust fund and the extra money that is still being collected for the trust fund as just another way to transfer wealth from wage earners to the rich.

No one complained about the decades of hard work of the Baby Boomers and the unprecedented properity the Boomers have created for this country. No one will complain as the Boomers die off and transfer their property to younger generations. No one has complained about the extra tax the Boomers have been paying since 1983 to pay in advance for their retirement. But now that the Boomers' advance payments have been handed over to the rich and used to pay for politicians' irresponsibility, demagogues will try to make this the Boomers' fault and whip up hostility between older and younger workers.

See the Wikipedia article entitled "Social Security Trust Fund."