Economic Collapse in 2013?

Well...we have almost made it through 2012.  Hollywood made a bunch of cash over the past few years by playing off all the rumors about 2012 being the end of the world.

But now that 2013 is just a few days away and the 'fiscal cliff" is getting closer and closer...is it possible that big, destructive things may happen if the 'fiscal cliff' becomes the fuse that lights the collapse?

Of course many people have been saying America is heading downhill for many decades...and they have always been proven wrong.  But at some point in time, one of them will be right.  Could this be that time?

Here is the info on the author of the article below;  Simon Johnson is a professor at the MIT Sloan School of Management and a senior fellow at the Peterson Institute for International Economics. He is co-author of “White House Burning: The Founding Fathers, Our National Debt, and Why It Matters to You.” The opinions expressed are his own

Even so, the U.S. has serious economic, social and political problems. Just look at the current budget debacle. Democrats and Republicans are at each other’s throats, struggling theatrically, rather like Holmes and Moriarty above Reichenbach Falls. If they get a fiscal deal done in the next few weeks, do you really think it will result in a sensible tax system, or bring long-term health-care spending under control? Are we going to invest more in education? Will we really have a frank discussion about what kind of social-insurance programs we want, and how to pay for them?

I’m also well aware that incentives to take excessive risk remain at the heart of Wall Street. The Dodd-Frank financial reforms contain some useful measures but do too little to significantly alter the balance of power between global megabanks and the rest of us. The Federal Reserve seems to be edging in the right direction on regulation but it is moving too slowly to make any difference for the next cycle.

And the U.S. is now entering perhaps the most dangerous phase of its long-standing tax revolt, in which Republicans insist on holding down federal revenue while the population is aging, but they won’t propose specific cuts in social programs, precisely because they know that Medicare and Social Security remain immensely popular.

More Borrowing

As a result, the political logic of the moment leads to continued increases in U.S. government borrowing, about half of which is financed, for now, by international savings at lowinterest rates. Our post-crisis monetary policy is contriving to keep those rates very low for a long time, presumably setting the table for a further round of mismanaged risk taking in the financial sector (just as it did after 2001).

So while no country will rise up to take America’s place as the world’s leading economy, its global position is indeed threatened -- by its own reluctance to have an honest conversation about the federal budget and by the unwillingness of its political leadership to confront powerful interests onWall Street.

Sooner or later, it will be America’s turn to fall out of favor with investors and to see its own interest rates rise. It is hard to know when that day will come, or precisely what pressures the country will face.

Let me only venture one forecast: We will not be ready.

Here:  http://www.bloomberg.com/news/2012-12-23/will-2013-mark-the-beginning-of-american-decline-.html

(sarcasm alert) What??  He doesn't think we will be ready?  How can that be?  We have been watching Oprah and Dr. Phil for years now telling us how to be happy...no matter what.  I even remember a book out called THE POWER OF POSITIVE THINKING which became a best seller.  Or how about that great saying, "If you believe, you can achieve!"

And now this MIT dork is telling us we won't be ready?!?!

What is he suggesting?...that we set aside some canned goods and water just in case some financial collapse overtakes us?  Well that's just 'stinkin-thinkin'".  If we just believe ONLY GOOD THINGS and keep repeating in our brains, "GOOD THINGS FOR GOOD PEOPLE"....then nothing bad can EVER happen...because we have the power to shape our own destiny.

Ummm...just for the record...I agree with Professor Johnson from MIT....we will NOT be ready.

"The prudent man sees danger coming and makes preparations."